The rally that swept over Wall Street on the first day of the month passed over Charming Shoppes Inc., which saw its shares sink 12.2 percent to $2.96 as it fell to an unexpected second-quarter loss and acknowledged a “significant decline” in its customer base.

The Bensalem, Pa.-based plus-size retailer cited fashion missteps that eroded margins and acknowledged it was cutting back on orders for the remainder of the year. The net loss for the three months ended July 31 totaled $8.6 million, or 7 cents a diluted share, compared with a profit of $5 million, or 4 cents, in the year-ago quarter. Analysts surveyed by Yahoo Finance had anticipated earnings of 6 cents.

Net sales contracted 1.8 percent to $517.6 million from $527.2 million in the prior year while same-store sales increased 3 percent and gross margin fell to 48.1 percent of sales versus year-ago margin of 50 percent.

After losing about 1.4 million customers, or 10 percent of its base, in 2009 because it didn’t adequately understand them, according to president and chief executive officer Jim Fogarty, marketing and promotion efforts added about 700,000 clients during the first half of 2010.

Shares established a new 52-week low of $2.84 in intraday trading Wednesday.

A tax benefit and better sales helped specialty retailer Express Inc. rebound into the black for the second quarter in its second earnings report as a public company.

The Columbus, Ohio-based firm posted profits of $22.1 million, or 25 cents a share, compared with a loss of $6.8 million, or 9 cents, a year earlier. Sales for the quarter ended July 31 rose 8.9 percent to $407.3 million from $373.8 million. Comparable-store sales increased 6 percent.

The firm’s e-commerce sales rose 60 percent in the quarter to 6.7 percent of total sales, or $27.3 million. Michael Weiss, president and ceo, said on the company conference call that it could increase to 10 to 15 percent of the total business.

Shares closed at $13.09, down 52 cents, or 3.8 percent.

Collective Brands Inc.’s second-quarter profits grew 17 percent but trailed Wall Street’s expectations as sales lagged at its Payless ShoeSource domestic chain.

For the quarter ended July 31, the Topeka, Kan.-based retailer said net income totaled $22 million, or 32 cents a diluted share, compared with profit of $18.8 million, or 29 cents a share, in the year-ago period. Net sales crept up 0.6 percent to $841.3 million from $836.3 million, a year earlier. Analysts were looking for earnings per share of 46 cents on sales of $863.3 million, Yahoo said.

Sales at its Payless domestic business fell 7.1 percent to $508 million, but rose at Payless International and the wholesale and retail components of the performance and lifestyle group.

Matthew Rubel, chairman and ceo, said on the company call that the Payless division aims to improve the “breadth and depth” of its accessories business, which accounted for 9 percent of global sales at Payless in the second quarter, a figure the company expects will rise to 12 percent within two years.

Shares rose 6.4 percent to $13.76 during the day, but fell more than 3 percent in after-hours trading following the earnings report.

Among manufacturers reporting Wednesday, an unexpected second-quarter profit and elevated guidance helped propel G-III Apparel Group Ltd. to the second largest gain of the firms tracked by WWD. Shares shot up $3.87, or 16 percent, to $28.01.

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