House of Fabrics Loses $73.2 Million in Quarter

House of Fabrics Inc., which is in Chapter 11 bankruptcy reorganization, reported a $73.2-million loss for its fiscal third quarter that ended Oct. 31.

The loss came on a 36% plunge in sales for the quarter, to $90.6 million. A year before, the Sherman Oaks fabric retailer lost $25 million on $141.8 million in sales.

The company blamed the sales decline mostly on store closings. Included in the loss for the recent quarter was a one-time pretax restructuring charge of $49.6 million for the store closures, and a $19-million provision for marking down certain products that no longer fit the company’s new merchandising program emphasizing crafts and home decorating.

During the quarter, House of Fabrics said, its same-store sales declined 19% because its financial problems led to a lack of some inventory, and it continued to face sharp price competition in the industry.

As of Oct. 31, the company had closed 62 mall stores, and 10 of its “super stores” were also closed in the third quarter. Another 38 mall stores and 170 super stores are scheduled to close by April 30.

In the nine months that ended Oct. 31, House of Fabrics lost $86.3 million, compared to a year-earlier loss of $29.8 million. Its sales fell 21%, to $315.4 million from $399 million.