Zale Reports $28.4 Million Loss

Zale reported a net loss of $28.4 million for the fiscal first quarter ended October 31, 2007. Net loss from continuing operations was $26.7 million and the loss from discontinued operations related to the Bailey Banks & Biddle brand was $1.7 million.

For the first quarter last year, the company reported a net loss of $26.4 million and a net loss from continuing operations of $24.7 million.

Total revenues for the quarter were $377 million compared to $382 million last year, a decrease of 1.3 percent. Comparable store sales decreased 0.4 percent. Revenues including Bailey Banks & Biddle for the first quarter were $428 million compared to last year's revenue of $432 million, a decrease of 1.0 percent.

“Earnings performance met expectations for the quarter as we offset slightly lower sales with gross margin rate improvement across all brands after adjusting for the warranty change,” commented president and CEO Betsy Burton.

Zale expects comparable store sales to be “flat to slightly negative” in the second quarter, which includes the November - December holiday season.