Zale Q3 Loss Widens as Sales Fall 20.5%
May 27, 09
North American jewelry chain Zale Corporation posted a net loss of $23.2 million in the third quarter, compared to a loss of $17.4 million in the third quarter of 2008. Zale suffered from a growing decline in sales, falling to $379 million from $477 million a year ago.
The 20.5 percent fall in revenues coincides with a 20 percent decrease in comparable store sales compared to an increase of 5.8 percent for the 2008 period.
At the end of April, the company had outstanding debt of $333 million, a reduction of $57 million from the second quarter of fiscal 2009.
“Our key goals coming into the quarter were to strengthen and stabilize the foundation of the business while recapturing the gross margin we lost from our promotional stance during Holiday,” commented CEO Neal Goldberg.
“We accomplished these goals as we generated positive free cash flow for the period with debt levels being reduced approximately $57 million from the second quarter and gross margins returning to above 50 percent.”
In other news, the company announced that Matthew W. Appel has been named executive vice president. Appel will become chief financial officer on June 15.