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DELIA’S SEES PROFITABLE QUARTER

NEW YORK -- It was a profitable first quarter for multichannel teen-oriented retailer Delia's Corp., thanks to a change in its accounting practices.<P>The New York-based company, which sells apparel, accessories and home furnishings through its...

NEW YORK — It was a profitable first quarter for multichannel teen-oriented retailer Delia’s Corp., thanks to a change in its accounting practices.

The New York-based company, which sells apparel, accessories and home furnishings through its catalog and 54 stores, reported income of $11.1 million, or 25 cents a diluted share, for the three months ended May 4, reversing a loss of $8.3 million, or 23 cents, in the same period last year. Excluding the beneficial effect of the accounting change, Delia’s in the most recent quarter had a loss of $4.3 million, or 9 cents, matching consensus estimates.

Total sales slipped 20.6 percent to $28.8 million from $36.2 million. Delia’s core sales, which consist of the catalog, its Web site and its retail locations, decreased 6.4 percent to $28.8 million from $30.7 million, reflecting planned reductions in catalog circulation.

Andrea Weiss, president, said in a statement, “Our performance benefited from a return to profitability in the direct business as well as continued strong new store openings.” Strengths in the quarter came from denim, peasant and bohemian-inspired tops, shoes and swimwear.

In addition, based on current trends, she said, “We look forward to achieving full-year profitability” and reaffirmed previously stated guidance regarding the second quarter and back half of 2002. For the second quarter, Delia’s expects a loss of 9 cents, but black ink in the third and fourth quarter, as it forecast earnings per share of 6 cents and 16 cents, respectively, bringing EPS for the year of 6 cents.

“Our progress on the merchandise front continues to gain momentum, and we are focused on building upon the positive customer response to our fashion assortment as we prepare for the key back-to-school season,” Weiss said.