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Bon-Ton Losses Mount

YORK, PA-Although third-quarter sales rose, operating costs eroded earnings during the Bon-Ton/Carson's integration.

By Marita Thomas | Updated on November 29, 2006

YORK, PA-The Bon-Ton Stores Inc. reported a net loss of $10.9 million for the third quarter, compared with a loss of $6.3 million in the same quarter a year ago. Yet, the locally based company, which acquired Carson’s Pirie Scott units from Saks Inc. this March, realized a 181%-gain in total sales, which climbed to $804.1 million for the quarter, aided by a $537.5-million contribution from the Carson’s stores.

Bon-Ton comp-store sales decreased 4.8% for the quarter. By contrast, Carson’s comp-store sales were up 7.8%, compared with its previous third quarter, and up 4.3% for the period ranging from the time of its acquisition by Bon-Ton from March 5 through Oct. 28. Combined comp-store sales of the Bon-Ton and Carson’s nameplates rose 3.3% for the 13 weeks ended Oct. 28.

Gross margins rose significantly during the quarter, up 2.8% to represent 36.6% of net sales, compared with 33.8% for the prior-year period. During a conference call, management attributed the margin increase to fewer markdowns on regular price merchandise.

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