HBC initiates quarterly dividend; loss from continuing operations widens

TORONTO – Hudson’s Bay Co. (TSX: HBC) plans to initiate a quarterly dividend of just over nine cents per share despite a wider a loss from continuing operations.

The dividend will be paid Dec. 27 to shareholders of record on Dec. 19.

HBC said its loss from continuing operations was $8.5 million or eight cents per share in the third quarter. That compared with a loss from continuing operations of $7.5 million or seven cents per share in the same year-earlier period.

Revenues in the three months ended Oct. 27 were $930.4 million, up from $896.7 million in the 2011 period.

The company’s net loss, which included a $6.5-million gain from discontinued operations, was $2 million or two cents per share.

That compared with net income of almost $1.24 billion or $11.83 per share a year ago when the company enjoyed an unusual gain of almost $1.25 billion from discontinued operations.

HBC said consolidated same store sales increased 3.5 per cent in the third quarter, with an increase of 4.5 per cent at Hudson’s Bay and 5.2 cent on a U.S. dollar basis at Lord & Taylor.

The improvement in same store sales was primarily driven by stronger storewide promotional events including Bay Days at Hudson’s Bay and Friends and Family at Lord & Taylor.

However, foreign exchange rate movements, related to the translation of Lord & Taylor results, and lower sales at Home Outfitters, negatively impacted consolidated same store sales results, it said.

“Hudson’s Bay and Lord & Taylor continued to deliver solid, mid-single digit same store sales increases for the third quarter of 2012, including an eight per cent same store sales increase in October at both banners,” CEO Richard Baker said in remarks accompanying the results.

“This continued strong performance has allowed the company to approve an initial quarterly dividend of 9.375 cents per share.”