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WOOLWORTH REPORTS NET LOSS FOR FOURTH QUARTER AND YEAR AFTER SPECIAL CHARGES

 WOOLWORTH REPORTS NET LOSS FOR FOURTH QUARTER
 AND YEAR AFTER SPECIAL CHARGES
 NEW YORK, Feb. 27 /PRNewswire/ -- Woolworth Corporation (NYSE: Z) today reported a net loss for the thirteen-week period ended Jan. 25, 1992, of $128 million, or 98 cents per share, compared to net income of $149 million, or $1.15 per share, for the thirteen weeks ended January 26, 1991. The loss for the period ended January 25, 1992, reflected an after-tax restructuring charge of $250 million, or $1.92 per share, as a result of a previously announced accelerated store redeployment program. In addition, the company changed its application of accounting for domestic specialty inventories under the last-in, first-out (LIFO) method of determining cost, which increased net income $35 million, or 27 cents per share.
 For the fifty-two weeks ended January 25, 1992, the company reported a net loss of $166 million, or $1.28 per share, compared to net income of $317 million, or $2.45 per share, for the fifty-two weeks ended January 26, 1991. In addition to the fourth quarter restructuring charge and the effect of the change in accounting for LIFO inventories, results for the period ended January 25, 1992, included an after-tax charge of $113 million, or 87 cents per share, reflecting the cumulative effect of a change in accounting for retiree benefits.
 Harold E. Sells, chairman and chief executive officer, said, "While 1991 proved to be a difficult year, we believe that our decision to accelerate the redeployment of approximately 900 underperforming stores in the United States will strengthen the company's long-term prospects."
 Accounting Changes
 The company adopted Financial Accounting Standard No. 106, "Employers' Accounting for Postretirement Benefits Other than Pensions" (FAS 106), effective retroactively to the first day of the company's 1991 financial year. FAS 106 requires accrual for postretirement benefits, other than pensions, over an employee's career, rather than charging these costs on a cash basis, as incurred. The company has recorded a one-time, after-tax, non-cash charge of $113 million, or 87 cents per share, to recognize the accumulated obligation for retirees and active employees as of January 27, 1991. The company also adopted Financial Accounting Standard No. 109, "Accounting for Income Taxes" (FAS 109), which did not significantly affect the company's reported results.
 During 1991, the company also changed its application of accounting for LIFO inventories in substantially all of its domestic specialty operations by using internally developed price indices to measure inflation in the retail prices of inventories. Previously, the company used the U.S. Department of Labor's Department Store Price Index to measure inflation. The company believes the use of internal indices better measures inflation's impact in the prices of merchandise sold in its domestic specialty stores. If the company had continued to use the Department Store Price Index, net income would have been $35 million lower for the fourth quarter and full year. The cumulative effect of the change on prior years is not determinable.
 Except for the cumulative effect of FAS 106, the accounting changes discussed above did not have a material effect on previously reported quarterly results.
 Revenues
 Revenues for the thirteen weeks ended January 25, 1992, increased 2.3 percent to $3,136 million from $3,064 million in the year-earlier period. Specialty store revenues increased 12 percent while general merchandise revenues decreased 4.0 percent.
 Domestic revenues increased 4.3 percent and foreign revenues, expressed in U.S. dollars, were essentially flat compared with the prior-year period. Included in fourth quarter domestic results are revenues of $167 million in 1991 and $197 million in 1990 that were generated by stores targeted for redeployment.
 For the 52 weeks ended January 25, 1992, revenues increased 1.3 percent to $9,914 million from $9,89 million in the prior year. Specialty store revenues increased 8.9 percent, while general merchandise revenues decreased 4.6 percent. Domestic revenues rose 3.2 percent, while foreign revenues, expressed in U.S. dollars, decreased 1.3 percent. Included in the full year domestic results are revenues of $510 million in 1991 and $600 million in 1990 that were generated by stores targeted for redeployment.
 The declines in general merchandise and foreign revenues were mainly attributable to the company's Canadian general merchandise operations which showed a comparable-store sales decline of 12 percent in 1991. This decline was largely the result of recessionary economic conditions in Canada, accompanied by unemployment rates nearing their highest level in 50 years. In addition, the goods and service tax imposed in that country on January 1, 1991, and the required Sunday closings in the province of Ontario, where the company has some 40 percent of its Canadian stores, also had a significant negative impact on sales.
 Fourth Quarter Operating Results
 For the 13-week period ended January 25, 1992, the company reported an operating loss (before corporate expenses, interest and taxes) of $163 million compared to operating income of $256 million in the comparable prior-year period.
 Domestic operations, which included the restructuring charge, had an operating loss of $260 million for the thirteen-week period compared to
operating profit of $93 million in the comparable year-earlier period. After giving effect to the change in accounting for LIFO inventories, discussed earlier, domestic results included a $40 million LIFO credit compared to a $32 million LIFO charge in the 1990 fourth quarter. Stores scheduled to close under the redeployment program incurred a $14 million operating loss in the 1991 fourth quarter.
 Foreign operating profit declined to $97 million from $163 million. Nearly 90 percent of the decline in foreign operating profit was attributable to the Canadian general merchandise operations, which took extensive promotional and clearance markdowns to reduce inventories in the fourth quarter.
 Worldwide specialty store operations had a loss for the 13-week period of $152 million, compared to a profit of $86 million in the comparable prior-year period. Specialty store results included $313 million of the domestic restructuring charge and, after giving effect to the change in accounting for LIFO inventories, included a $40 million LIFO credit compared to a $25 million LIFO charge in the prior-year period.
 Reflecting $77 million of the domestic restructuring charge and the high level of markdown activity in Canada, worldwide general merchandise operations had a loss of $11 million, compared to a profit of $170 million in the 1990 fourth quarter. There was no LIFO adjustment for general merchandise operations in the 1991 fourth quarter, and a LIFO charge of $7 million in the comparable 1990 period.
 1991 Operating Results
 For the fifty-two weeks ended January 25, 1992, operating profit declined to $53 million from $639 million in the comparable period of the year before.
 Reflecting the $390 million restructuring charge and the change in accounting for LIFO inventories, domestic operations had a loss of $92 million compared to a profit of $333 million for the year before. Domestic results included a $25 million LIFO credit compared to a $49 million LIFO charge in the prior year. Stores included in the accelerated redeployment program incurred a $64 million operating loss for 1991.
 Foreign operating profit for 1991 declined to $145 million from $306 million in the prior year.
 A comparison of year-to-year operating profit follows:
 WOOLWORTH CORPORATION
 (In millions)
 Fifty-two-weeks ended Jan. 25, Jan. 26,
 1992 1991
 Specialty
 Kinney U.S. $ 311 $ 260
 Kinney Canada 14 34
 Kinney Australia 6 10
 Richman/Susie's (35) (10)
 Little Folk and other specialty 11 12
 Restructuring charge (313)
 (6) 306
 General Merchandise
 Woolworth U.S. 34 90
 Woolworth Canada (22) 95
 Woolworth Germany 121 148
 Woolworth Mexico 3 -
 Restructuring charge (77)
 59 333
 Total Operating Profit $ 53 $ 639
 After giving effect to the change in accounting for LIFO inventories, the results of worldwide specialty operations included a $32 million LIFO credit, compared to a $35 million LIFO charge in 1990. General merchandise operations included a $7 million LIFO charge in 1991 compared to a $14 million LIFO charge in 1990.
 Changes in foreign currency translation rates did not have a significant effect on year-to-year revenue or operating-profit comparisons for the thirteen- or fifty-two-week periods ended January 25, 1992.
 WOOLWORTH CORPORATION
 Consolidated Statement of Operations
 (Unaudited, in millions except per share amounts)
 Periods ended: Thirteen weeks Fifty-two weeks
 Jan. 25, Jan. 26, Jan. 25, Jan. 26,
 1992 1991 1992 1991
 Revenues $3,136 $3,064 $9,914 $9,789
 Costs and expenses
 Costs of sales 2,129 2,122 6,684 6,534
 Selling, general, and
 administrative expenses 727 632 2,575 2,433
 Depreciation and amortization
 Total 72 66 261 234
 Interest expense 20 19 87 95
 Restructuring charge 390 390
 Total 3,338 2,839 9,997 9,296
 (Loss) income before
 income taxes (202) 225 (83) 493
 Income taxes (74) 76 (30) 176
 (Loss) income before
 cumulative effect of change
 in accounting principle (128) 149 (53) 317
 Cumulative effect on prior years
 of adopting FAS 106 (113)
 Net (loss) income $ (128) $ 149 $ (166) $ 317
 AMOUNTS PER COMMON SHARE
 (Loss) income before cumulative
 effect of change in
 accounting principle $(0.98) $ 1.15 $(0.41) $ 2.45
 Cumulative effect on prior years
 of adopting FAS 106 (0.87)
 Net (loss) income $(0.98) $ 1.15 $(1.28) $ 2.45
 Dividends declared $ .27 $ .26 $ 1.08 $ 1.04
 Weighted-average number of
 common shares outstdg. 130.2 129.5 130.2 129.5
 NOTE: See comments on the restructuring charge and accounting changes above.
 -0- 2/27/92
 /CONTACT: Frances E. Trachter of Woolworth Corporation, 212-553-2394/
 (Z) CO: Woolworth Corporation ST: New York IN: REA SU: ERN


TS -- NY017 -- 3132 02/27/92 09:36 EST
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