Stage Stores selling Steele's unit, charge hits 4Q

Published on NewsOK Modified: March 6, 2014 at 7:30 am •  Published: March 6, 2014
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HOUSTON (AP) — Stage Stores' fiscal fourth-quarter net income fell 30 percent, stung by a charge tied to the sale of its Steele's discount store division and softer revenue. Its adjusted earnings topped analysts' estimates.

Stage Stores said Thursday that it is selling its off-price retail division Steele's to Hilco Global Retail Group in an equity deal whose value could not immediately be determined.

Stage Stores Inc. launched Steele's in 2011. The chain sells clothing, accessories, shoes and home decor items at discounted prices. Stage Stores currently runs 35 Steele's stores in seven states. Stage Stores also has 848 stores in 40 states under brands including Bealls, Goody's, Palais Royal, Peebles and Stage.

The companies said that Stage Stores will provide certain support services through its operating subsidiary Specialty Retailers Inc. for an undisclosed time period after the transaction is complete. The deal is expected to close in the current quarter.

For the period ended Feb. 1, Stage Stores earned $24.9 million, or 78 cents per share. A year earlier it earned $35.8 million, or $1.09 per share.

Removing an impairment charge related to Steele's and items tied to the consolidation of its South Hill, Va. operations into its Houston headquarters, earnings were $1.01 per share.

Analysts surveyed by FactSet expected earnings of 99 cents per share.

Revenue dropped 5 percent to $499.4 million from $527.9 million. Taking out Steele's, revenue for the current quarter totaled $493 million. Wall Street predicted revenue of $510.3 million.