Hudson’s Bay Co. had a big increase in profit in its latest quarter as it continued to integrate the Saks luxury business into its retail operations.
HBC’s net income jumped to $111 million in the quarter ended Jan. 31, nearly four times higher than a year earlier when the company had a number of unusual expenses related to its purchase of Saks in mid-2013.
The stronger U.S. dollar also helped bump up HBC’s profit, which is reported in Canadian dollars.
The Toronto-based company had $29 million of net income in the quarter ended Feb. 1, 2014, which was down from $86.8 million in the comparable quarter of 2013 before it acquired Saks for US$2.9 billion.
Sales were up about 9%, rising to $2.6 billion from $2.4 billion in the fourth quarter of fiscal 2014.
HBC said its digital sales were up 35% from a year earlier, rising to $304 million — about 11.5% of the total.
“It was a strong conclusion to a successful year for our company,” said Richard Baker, HBC’s governor and executive chairman.
“Sales growth, further progress with the Saks integration and continued strength at HBC Digital has us well-positioned to deliver on our fiscal 2015 strategic priorities and initiatives.”
The company is one of Canada’s biggest retailers and has a significant presence in the United States.
It operates a total of 322 stores under the Hudson’s Bay, Lord & Taylor and Saks Fifth Avenue, OFF 5th and Home Outfitters brands.
One of the fastest-growing parts of the business was OFF 5th, a secondary brand acquired when HBC bought Saks. Same-store sales at OFF 5th was up 12.1%, compared with a 2.6% increase at Saks Fifth Avenue and 2.3% at the Department Store Group that includes the Hudson’s Bay and Lord & Taylor stores.
