Gordmans joins e-commerce era as performance improves

It is a case of better late than never at value priced department store retailer Gordmans Stores where the company has the distinction of being one of the last major retailers to sell merchandise on the Internet.

Omaha, NE-based Gordmans has grown to 101 stores in 22 states and in the company’s second quarter it achieved the somewhat belated milestone of selling online.

“Now guests from across the country may access Gordmans extraordinary value proposition anytime, anywhere,” Gordmans President and CEO Andy Hall said in conjunction with the release of second quarter results.

The addition of online sales could help bolster Gordman’s top line growth which has improved of late, but is still in negative territory. Net sales increased 1.7% to $143.4 million, thanks to the addition of two new stores, but same store sales declined 1.6%. The comp decline was viewed as victory of sorts because the negative number was less worse than prior periods and the shifting of sales tax holidays into August from July last year had a 1% negative impact.

The company also viewed its net loss in a positive light. When the heavily indebted company excludes a charge related to refinancing its debt, the net loss for the second quarter was $1.8 million, or nine cents a share, compared to a net loss of $3.2 million, or 16 cents a share, the prior year.

"We are pleased with the continued improvement in our bottom line performance. The second quarter net loss, excluding costs related to the extinguishment of high rate term debt, improved 43% and was driven by higher sales and better gross margin performance,” Hall said. “It was good to see that our comp store sales trend improvement continued in the second quarter.”

Heading into the back half of the year, Hall said the company is pleased with its inventory content as the receipt of back-to-school merchandise was accelerated to be better positioned to capture August sales. Accordingly, the company is eyeing third quarter same store sales growth of flat to low single digits and further gross margin improvement.