99 Cents Only Stores posts Q3 loss

City of Commerce, Calif. - 99 Cents Only Stores reported a loss loss and a decline in same store sales in the third quarter.



The company reported a loss of $3.8 million in the third quarter, ended Oct. 31, compared to income of $1 million in the prior year quarter.



Net sales increased by 5.0% to $478.3 million. Same store sales decreased 0.7% compared with the prior year quarter.



During the third quarter, the company completed ther roll out of its "Go Taller" initiative, which consisted of raising the height of shelving across the chain to create an enhanced canvas for visual merchandising. The transformation was accelerated in August and September 2014 in order to complete the conversion of the entire chain before the holiday season.



In addition, 99 Cents deployed in the third quarter a new centralized forecasting and merchandise replenishment system, replacing its legacy system and longstanding decentralized methodology. The company said the operation disruption caused by these two initiatives negatively impacted same store sales during the first two months of the quarter.



"One of our top priorities is to further establish 99 Cents Only as the preferred destination for seasonal merchandise," said Stephane Gonthier, CEO of 99 Cents Only. "By completing the implementations of our ‘Go Taller’ program and replenishment system ahead of schedule in September, we were able to focus attention on our important seasonal programs. We have been pleased with the results, with Halloween sales growing more than 50 percent over last year, leading to an increase in same-store sales of 2.9 percent for the month of October."



During the third quarter, the company opened 12 stores. The company now operates 362 stores, an increase of 8.7% in store count over the end of the same period last year.