Zale Q2 Net Earnings Plummet to $52.7 Million

Zale’s second quarter net earnings dropped sharply to $52.7 million, from $77.1 million in the second quarter of fiscal 2007. Zale President and CEO Neal Goldberg said the results are disappointing.

The North American jewelry chain previously announced a 7.3 percent fall in comparable store sales and revenues of $827 million compared to $892 million last year.

The second quarter ended January 31, 2007 included a $2.5 million “positive impact related to derivative accounting treatment for the Company’s gold and silver contracts,” Zale said in a release.

Unrecognized revenues related to warranty sales increased $33 million for the quarter, while year-to-date, unrecognized revenues increased $47 million.

According to Goldberg, “We intend to make Zale into a more nimble and efficient organization.”