HomeBase Loses $1.1 Million in Quarter

Home improvement store chain HomeBase Inc., facing increasing competitive pressures, posted a net loss of $1.1 million, or 3 cents a share, for the first fiscal quarter, contrasted with net income of $653,000, or 2 cents a share, for the first quarter last year.

The Irvine company recorded charges of $4.4 million during the recent quarter, stemming in part from its development of five House 2 Home test stores that will focus on home furnishings, garden supplies and outdoor furniture. HomeBase plans to convert four of its regular stores to House 2 Home stores.

HomeBase also recorded a $4 million gain, freeing up reserves that had been set aside for two closed stores. The company plans to reopen one of the stores as a House 2 Home store and negotiated a lease termination at the other site.

Sales for the three months ended April 29 rose slightly to $365.8 million from $365.3 million. HomeBase has 88 stores in operation this year, up from 85 in the first quarter last year.