Zale Q1 Revenues Decrease to $378 Million

Zale’s first quarter comparable store sales decreased 0.4; revenues of $378 million meant a decrease of 1.2 percent compared to last year, the company said Thursday morning.

The results exclude revenues from the Bailey Banks & Biddle (BBB) stores, which are being sold to Finlay Fine Jewelry. Including BBB, comparable store sales decreased 0.3 percent and revenues were $428 million compared to last year's revenues of $432 million, a decrease of 1.0 percent.

Zale, a specialty retailer of fine jewelry in North America, reported that, due to a change in its jewelry protection plan – from a two-year to a lifetime agreement –cash from warranty sales, excluding BBB, increased $9.5 million over the first quarter last year, and revenues recognized were $6.1 million less than the prior year.

The company indicated that it is comfortable with the more favorable end of its previously issued earnings per share guidance of a $0.59 to $0.63 loss for the first quarter.

"We continue to execute our strategy of maximizing gross margin dollars and maintaining good expense control in the current challenging macro environment,” CEO Betsy Burton commented. “This is demonstrated by the fact that even with relatively flat sales this quarter, we expect to achieve our earnings objectives."

Zale will announce its first quarter earnings results on November 20.