Leon's Q1 profit falls to $5.4 million
TORONTO - Lower same-store sales, store opening costs and expenses related to the acquisition of The Brick Ltd. all contributed to a smaller first-quarter profit, Leon's Furniture Ltd (TSX:LNF) said Tuesday.
The retailer said net earnings in the three months ended March 31 totalled $5.4 million or seven cents per diluted share, down from $8.6 million or 12 cents per share in the same 2012 period.
The seller of home furnishings, electronics and appliances reported revenue of $162.5 million, up from $157.4 million.
Total sales of its 309 stores under various banners were $203.6 million, including $41.1 million of franchise sales and $11.8 million of The Brick sales in the final few days of March after the acquisition closed on March 28.
That compared with sales in the first quarter of 2012 were $200.7 million, including $43.2 million of franchise sales.
Same-store sales fell by 5.8 per cent compared with a year ago.
"2013 is proving to be another challenging year where we continue to see a soft economy with no clear signs of any major turnaround," Leon's said in a statement accompanying its earnings report.
"Having said that, we are pleased that we have completed the purchase of The Brick at the end of the first quarter 2013 and had successful grand openings of three new stores so far this year."
Although the branding of both the Leon's and Brick divisions will remain separate, the company said it had already "begun the process to integrate the best practices of each for the benefit of both."
"We expect the results will help improve the performance of Leon's Furniture Limited as a whole going forward," it said.