Sales rise but profits fall at Charlotte-based Belk
04/09/2014 6:26 PM
04/09/2014 6:27 PM
Profits at Charlotte-based Belk Inc. fell 16 percent for the retailer’s most recent fiscal year, Belk said Wednesday, as higher costs from its new information technology systems ate into earnings.
Sales rose 2.1 percent, to just over $4 billion for the year ending Feb. 1. But profits slipped to $159 million, down from $188 million a year ago.
Sales from Belk.com surged 43 percent, the department store company said. That contributed a relatively small amount, however – 1.5 percent – to the company’s comparable store sales, a measure of the retailer’s performance.
“Compared to recent years, fiscal 2014 was a challenging year with a shorter holiday selling season, and our earnings were impacted by additional expense associated with key strategic initiatives, such as expanded Omnichannel and eCommerce capabilities,” chief executive Tim Belk said in a statement.
Belk suffered a major site outage during Black Friday weekend, when the company’s website went down during the year’s busiest time for online shopping. The company blamed heavy customer traffic for the outages. November was the planned “go-live” month for its new information-technology platform.
The company operates 300 stores in 16 states, mainly throughout the Southeast. Belk is the largest privately held department store company, with most of the company’s stock still controlled by members of the Belk family.
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