By  on April 20, 2009

KarpReilly LLC’s quest for representation on the board of Charlotte Russe Holding Inc. ended quietly Thursday, and in advance of the annual meeting.

Earlier rejected in its bid to acquire the company, KarpReilly, citing critical reports from two proxy advisory firms, withdrew its slate of nominees to the retailer’s board.

The San Diego-based women’s retailer also reported a net loss of 4 cents a diluted share during its second quarter. Excluding impairment charges and costs related to the now-ended proxy battle, it turned a profit of 4 cents a share, 6 cents above analysts’ consensus estimates of a 2 cent loss.

KarpReilly, which had sought to put three individuals on the board, withdrew its proposal after reports issued by RiskMetrics Group, formerly ISS, and Glass Lewis & Co. recommended stockholders support all seven of Charlotte Russe’s incumbent nominees.

In November, Russe rejected KarpReilly and shareholder H.I.G. Capital Partners LLC’s buyout offer of $9 to $9.50 a share, or $188 million to $199 million. Since then, with a new management team and a turnaround plan in place, the retailer had been urging its shareholders to stick by its side. But some investors were critical of the spurning of the bid, and Russe opted to put itself up for sale last month.

KarpReilly owns 8.9 percent of Charlotte Russe, according to the most recent filings with the Securities and Exchange Commission.

Quarterly revenue grew 3.3 percent to $191.2 million, from $185.1 million, as comparable-store sales fell 8.6 percent.

In the first half, the net loss came to $3.7 million, or 18 cents a share, versus net income of $18.2 million, or 73 cents, a year ago. Sales were up 2 percent to $431.9 million from $423.3 million.

In the third quarter, Russe said it expects comps to be down low-single digits and earnings, exclusive of charges from the proxy contest, to be between 17 and 27 cents, in line with analysts’ estimates of earnings per share of 19 cents.

Charlotte Russe’s annual meeting is scheduled for April 28.

Russe said it incurred $1.5 million in charges related to the proxy contest, in addition to unrelated costs totaling $1.6 million, giving the company an $820,000 net loss, or 4 cents a diluted share. Stripping out charges, the retailer said it had EPS of 4 cents. Last year, Russe had a profit of $4.2 million, or 17 cents.

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