MERRIMACK, N.H.–Retailer Brookstone posted a net loss of $16.7 million in its fiscal second quarter, compared to a net loss of $8.7 million in its second quarter of last year.
The deeper red ink occurred primarily because of a 25.1 percent decrease in its net sales, which were $73 million in the quarter. The decline in sales (which included an 18.6 percent falloff in same-store sales) offset a reduction in selling, general and administrative expenses of 27 percent, and a drop of 18 percent in its cost of sales. Brookstone’s loss from operations rose from $7.7 million in last year’s second quarter to $10.5 million this year, and its gross margin plummeted 700 basis points to 20 percent.
Philip Roizin, chief executive officer, said the sales decrease was in line with Brookstone’s internal financial plans. The company expects same-store sales to remain negative in the third quarter, although at a lower rate than in the second quarter, and to turn positive in the fourth quarter, Roizin said.