Restoration Hardware sees losses in the third quarter
On the heels of a takeover bid by Sears Holdings, Restoration Hardware released third quarter results today showing revenue rose 10.6 percent to $173.7 million, compared with $157.1 million in the same period last year. The company reported a net loss of $15.2 million, deeper than the $5.7 million in losses the retailer recorded last year.
Of those losses, $1.4 million came from costs associated with a merger agreement between Restoration Hardware and affiliates of investment company Catterton Partners, a plan that the retailer announced on Nov. 8. That merger agreement was challenged later in November by Sears Holdings, which offered to acquire Restoration Hardware for a slightly higher per-share price than Catterton.
Afurther $400,000 in losses was related to headcount reductions at the company’s Corta Madera, Calif.-based headquarters.
"Weakening consumer spending and traffic levels continued to affect our business in the third quarter, particularly higher ticket durable categories,” said Gary Friedman, president and CEO of Restoration Hardware. “While we are encouraged by some of the early holiday trends in our business, we remain cautious due to the macro economic environment, which has proven highly challenging for the home furnishings sector this year."
Restoration Hardware opted not to hold a third quarter conference call because of “pending merger agreement activities.” The company said it would update investors through press releases and filings with the Securities and Exchange Commission.
Restoration Hardware sells high-end home furnishings, decorative hardware, fashion plumbing fixtures and bathware through more than 100 stores nationwide.