Dive Brief:

• HBC on Wednesday reported that fourth quarter revenue fell to 2.9 billion Canadian dollars ($2.18 billion), a decrease of CA$167 million from the same quarter a year ago, which included an extra selling week garnering CA$120 million. Excluding that, fourth quarter revenue declined CA$47 million or 1.6% in 2018, according to a company press release. The company boosted net income from CA$84 million a year ago to CA$286 million.

• The Canadian department store retailer's comparable sales in the quarter fell 1.4%, with comparable digital sales up 8.7%. By banner in the quarter, Saks Fifth Avenue comps grew 3.9%, its seventh consecutive quarter of comp growth. On a two-year stack, Saks Fifth Avenue comp was 7%. Comps at DSG (Hudson's Bay, Lord & Taylor and now-shuttered Home Outfitters) fell 5.2%, and at Saks Off 5th comps fell 2.1%, but "a substantial year-over-year increase in digital sales" is moderating that decline, the company said.

• For the year, HBC revenue reached $9.4 billion for the year as comparable sales declined 0.2%, consistent with 2017, the company also said. Net loss narrowed to $542 million from the $581 million loss the previous year. During the fourth quarter, HBC's store count declined to 342 from 350.

Dive Insight:

HBC's cost-cutting measures are "not a one-year event," CEO Helena Foulkes declared on a conference call with analysts on Wednesday morning. Most recently the company announced it was shuttering its 37 Home Outfitters furniture stores in Canada, after earlier selling its Lord & Taylor flagship and its Gilt online site and streamlining its European operations.

Those netted cash that helped off-set the disappointment in the company's top-line results. The company is banking on its best-performing retailer, Saks, and has invested in a renovation of its Manhattan flagship that is performing well despite disruptions to holiday sales the construction caused, the company said. HBC also sees strength in its Saks Off 5th off-price fleet, although as many as 20 underperforming stores will be shuttered after a comprehensive review, executives reiterated Wednesday.

Indeed, while the company has made strides in merchandising, its real estate strategy will continue to play a pivotal role in righting its operations. In a statement Wednesday, Richard Baker, HBC's governor and executive chairman and a real estate mogul in his own right, called the company's "ability to identify undervalued real estate with great potential ... a key long-term differentiator."