Caché Inc. swung to a loss in the third quarter as consumers tightened spending on discretionary items.
For the quarter ended Sept. 27, the New Yorkbased 295-unit specialty chain had a net loss of $1.6 million, or 12 cents a diluted share, compared with net income of $161,000, or 1 cent a share, for the same period last year. The loss in the 2008 quarter included store closing costs of 2 cents a share. Net sales fell 4 percent to $58.1 million, from $60.6 million in the 2007 period, and same-store sales declined 4 percent.
The revenue results were in line with analysts’ expectations and the loss slightly smaller than the 13-cent consensus provided by Yahoo Finance.
Gross margin declined to 44.1 percent of sales from 45.7 percent in the year-ago period, and average inventory per store was down 16 percent, the company said.
“As we anticipated, our third-quarter results were negatively affected by the challenging economy, which heightened in severity in September,” said Thomas Reinckens, chairman and chief executive officer.
Piper Jaffray retail analyst Neely Tamminga said in this tough environment, she was “encouraged” that Caché is “focused on lower-price-point items,” which could “help to stabilize same-store sales.”
For the nine months, the retailer registered a loss of $1.6 million, or 12 cents a diluted share, compared with net income of $1.6 million, or 10 cents a share, in the year-ago period. The year-to-date figure includes store closing costs of 13 cents a share and expenses of 3 cents relating to a management change. Brian Woolf resigned as ceo in January and was named president of Charming Shoppes Inc.’s Lane Bryant division in July.
Net sales grew 2 percent to $199.8 million from $196 million. Same-store sales increased 1 percent.
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