Save E-mail

Send this URL to a friend:

* - Denotes a required field.
Your Name*
Your Email Address*
Friend's Name*
Friend's Email Address*
Subject*
Message*

Print

Dallas--Same-store sales increased 6 percent in the first quarter of fiscal 2012 for Zale Corp., marking the retailer’s fourth straight quarter of positive comps.

Total revenues for the quarter ended Oct. 31 were $351.0 million, up 7 percent from $327.0 million in the same period last year, the retailer reported Monday. Net loss from continuing operations was $32.0 million, compared to a net loss of $97.9 million in the first quarter of fiscal 2011.

Gross margin was 54 percent, up from 51 percent in the comparable quarter last year, with the company attributing the improvement to a combination of price increases implemented in July and October and less discounting, partially offset by rising commodity costs.

“Our performance this quarter demonstrates the progress we are making towards returning the company to profitability,” Zale CEO Theo Killion said. “We’ve now achieved top-line growth in four consecutive quarters, and our efforts to expand operating margins are gaining traction.”

Zale recently introduced a number of new lines, including bridal by wedding dress maven Vera Wang, fashion jewelry by designer and singer Jessica Simpson, and Persona, a line of personalized jewelry.

On a conference call held Monday evening, Killion said early results for these lines have been “encouraging” and have improved as Zale has rolled out its holiday marketing campaign. During the quarter, Zale also introduced new financing that allows “even greater accessibility” to its brands, created for guests who do not qualify for financing through the retailer’s primary credit program, he said.

While Zale has been able to string together several quarters of positive comps, the size of the retail chain continues to shrink.

Zale executives said during Monday’s call that the company closed seven jewelry stores and two kiosks in the first quarter, while opening one new kiosk.

The company ended the first quarter with 1,821 retail locations, 1,156 jewelry stores and 665 kiosks, down from 1,891 locations, 1,218 stores and 673 kiosks, at the end of the first quarter 2011.

The company plans to close another 20 jewelry stores and five kiosks during the course of the fiscal year.

“Our expectation continues that we will selectively close a small number of stores that are underperforming if the economics makes sense and, over time, we will open new stores where the opportunity is compelling,” Zale Chief Financial Officer Thomas Haubenstricker said.

Zale ranks No. 3 on National Jeweler’s 2011 list of $100 Million Supersellers.