At Home swings to Q1 loss; early results of reopened stores ‘encouraging’

At Home Group swung to a first-quarter loss as its stores went dark during the pandemic. But it is seeing double-digit sales gains at reopened stores. 

The value home goods superstore retailer reported a net loss of $358.9  million for the quarter ended April 25. compared to net income of $13.9 million in the year-ago period. The adjusted loss was $39.2 million  compared to adjusted income of $1.9 million last year. 

Net sales decreased 38.0% to $189.8 million from $306.3 million as a result of temporary store closures due to the COVID-19 pandemic, which was partially offset by a net increase in the number of stores. Comparable store sales decreased 46.5%  

In a statement, chairman and CEO Lee Bird said with the pandemic, the company has focused on preserving liquidity and enhancing financial flexibility.  As previously announced, At Home has slashed capital expenditures and does not plan to open additional stores this year (beyond the six it opened in the first quarter). But on the company’s earnings call with analysts, Bird said he still envisions At Home as a 600-store fleet in the future.

“We love the power of the stores,” Bird said. “And we look forward to adding more stores … next year, we plan to open up a few stores that were in the pipeline and then get back to our long-term targets after that.”

At Home beginning reopening its stores in early May. Currently, nearly all its 219 stores are fully open to customer traffic.   

“As stores have reopened, we are pleased that early results are encouraging across all markets and initial sales in reopened stores are up solid double digits versus the same period last year,”  Bird told analysts. “While it is too early to know how sustainable this is, we know our customers have been spending more time at home and refreshing their indoor and outdoor spaces.”

At Home, whose stores average 105,000-sq.-ft., has added enhanced cleaning, sanitization and social distancing measures across its  stores and distribution centers. 

“Our largely stand-alone locations, low labor model and large square footage, combined with these sanitization protocols enable our associates to safely work and our customers to safely shop, Peter S. G. Corsa, president and COO, said on the call. “We believe that as customers are defining their new shopping norms, these unique aspects of our business give At Home a distinct advantage versus competitors."