Zale Comparable Sales Up in Q1, Posts $28 Million Loss

(IDEX Online News) – American jewelry retailer Zale reported a modest increase in sales and a decrease in the net loss for the first quarter ended October 31.

Total revenue increased 1.8 percent to $357 million, Zale reported Tuesday night.

Comparable store sales increased 3.9 percent. At constant exchange rates, which exclude the effect of translating Canadian dollars into U.S. dollars, comparable store sales increased 3.7 percent.

The company's Canadian operations witnessed the largest increase in comparable store sales. Peoples Jewellers and Mappins Jewellers posted an increase of 5.5 percent. At constant exchange rates, comparable store sales increased 4.0 percent in the first quarter of fiscal 2013.

In the U.S., Zales Jewelers, Zales Outlet and Gordon’s Jewelers posted a comparable store sales increase of 3.9 percent.

The improved sales have only marginally suppressed the 2 percent U.S. inflation rate.

Zale's gross margin was $190 million, or 53.2 percent.

Zale posted a net loss of $28 million for the quarter, compared to a net loss of $32 million in the first quarter of fiscal 2012.

“We are pleased to report our eighth consecutive quarter of positive same store sales and continued progress towards our goal of returning Zale to profitability,” commented CEO Theo Killion. “As we enter the holiday period, we are confident our foundation is in place for this important selling season.”

In its outlook, the company said it expects to return to profitability in fiscal 2013.