House of Fabrics Reports Sharp Decline in Profits

House of Fabrics Inc., a Sherman Oaks-based chain of fabric stores, said its fiscal fourth-quarter profit fell sharply from a year earlier, partly because of $1 million in expenses due to the Northridge earthquake.

For the quarter ended Jan. 31, the company earned $212,000, down from $2.21 million in the same period a year earlier. Revenue in the latest quarter declined 6%, to $147.6 million from $157.7 million a year earlier.

The company’s operating profit in the latest quarter was $4.12 million, but it incurred $3.1 million in interest expenses. Plus, the company was hurt by the earthquake, which damaged corporate headquarters and a number of its retail stores.

For its fiscal year ended Jan. 31, House of Fabrics reported a loss of $29.5 million, contrasted with a profit of $5.2 million in its previous fiscal year. The loss included a charge of $12.9 million for restructuring. Revenue in the latest fiscal year totaled $546.7 million, down slightly from $557.5 million a year earlier. The company said its bank debt and inventory were down and that it would continue to close unproductive stores.