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Dip in Lord & Taylor same store sales not enough to keep HBC's Q1 in the cold

TORONTO — A same-store sales decline at Lord & Taylor was not enough to keep Hudson's Bay Company's first quarter results for the period ended May 4 in the cold, thanks to strong same-store sales growth at Hudson's Bay.

The company's retail sales were $884 million for quarter, a 4% increase from $848 million for the first quarter a year ago. Consolidated same-store sales grew 4% in the first quarter. Hudson's Bay same-store sales grew nearly 8%, and were partially offset by a same-store sales decline of 1.4% at Lord & Taylor.

"We are pleased with our first quarter performance," stated HBC governor and CEO Richard Baker. "Our strong sales growth can be attributed to several factors, including improvements in store productivity, increased e-commerce sales and our partnership with Topshop/Topman. These strategic initiatives drove gains at Hudson's Bay, which continues to outperform its competitors. At Lord & Taylor, our sales performance was impacted by unfavorable year over year weather patterns."

Sales at Hudson's Bay were driven by strong performance of men's apparel, ladies' shoes, cosmetics, handbags, accessories and certain home categories, the continued growth of e-commerce sales and the company's five Topshop/Topman stores.

Meanwhile, sales at Lord & Taylor were impacted by lower customer traffic due to unfavorable weather trends compared to the first quarter of 2012, with strength in men's apparel, handbags, accessories and cosmetics offset by underperformance of ladies' apparel and shoes. Reflecting the company's strategic focus on growing its e-commerce channel, online sales contributed strongly to sales growth in the quarter, rising 33% to $31 million.

The company's gross profit was $356 million for the quarter compared to $341 million for the first quarter a year ago. Gross profit increased primarily thanks to sales growth at Hudson's Bay.