NEW YORK — Sales slumped in the third quarter, but comparisons to year-ago charges allowed Reeds Jewelers Inc. to narrow its loss.
For the three months ended Nov. 30, the Wilmington, N.C.-based jewelry retailer reported a net loss of $692,000, or 8 cents a diluted share. That compares favorably with last year’s loss of $9.1 million, or $1.07.
The prior-year loss was compounded by asset impairment and restructuring charges totalling $10.8 million. Excluding those items, last year’s loss would have been a more moderate $1.7 million, or 20 cents.
The shuttering of 19 stores to 96 from 115 last year caused quarterly sales to fall 11.7 percent to $21.8 million from $24.7 million. In a bright spot, comparable-stores grew 5.2 percent.
Other positive indicators included a gross margin gain of 100 basis points to 49.4 percent of sales from 47.1 percent a year ago, and lower costs as selling, general and administrative expenses dropped 210 basis points to 49.7 percent of sales from 51.8 percent a year ago.
Overall, for the first nine months of the year, Reeds lost $3.1 million, or 37 cents a diluted share. That compares with a year-ago loss of $13.2 million, or $1.56.
Excluding restructuring and asset impairment charges in the year-over-year periods, the firm would have recorded net losses of $3 million, or 35 cents, versus $6.8 million, or 80 cents, a year ago. Sales for the first three quarters decreased 9 percent to $62.1 million from $68.3 million, as same-store sales rose 3.1 percent.