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Reeds Losses Cut to $1.5M

NEW YORK — Deteriorating sales caused Reeds Jewelers Inc. to continue bleeding red, albeit less severely, in the second quarter.<br><br>For the three months ended Aug. 31, the Wilmington, N.C.-based jewelry retailer reported a net loss of $1.5...

NEW YORK — Deteriorating sales caused Reeds Jewelers Inc. to continue bleeding red, albeit less severely, in the second quarter.

For the three months ended Aug. 31, the Wilmington, N.C.-based jewelry retailer reported a net loss of $1.5 million, or 18 cents a diluted share. That was, however, an improvement over last year when the company posted a net loss of $2.4 million, or 28 cents.

Restructuring expenses of $270,000 ate into the bottom line. In the quarter, Reeds took the final restructuring charges from the reorganization it began in the third quarter of last year. Included in the plan was the shuttering of 24 under-performing stores.

Sales for the quarter regressed 13.9 percent to $19.2 million from $22.3 million a year ago, and comparable-store sales slipped 3.7 percent during the period.

Other performance indicators were more positive, though, as gross margin improved 400 basis points to 49.5 percent from 45.5 percent a year ago, and selling, general and administrative expenses dropped to 55.6 percent of net sales from 57 percent of net sales last year.

Overall, for the first half of the year, the company reported a net loss of $2.4 million, or 29 cents a diluted share. That compares with last year’s net loss of $4.1 million, or 49 cents.

Also during the quarter Reeds closed two stores.