Shares of Zale Corp. tanked today after the company posted worse-than-expected losses in its fiscal first quarter, which nonetheless marked an improvement over the year-ago period.
Shares of the jeweler were down 28.9 percent to $5.29 at 1:00 p.m. in New York, when the markets were generally up ahead of the Thanksgiving holiday.
Net losses narrowed to $28.3 million, or 88 cents a share, from $31.9 million, or 99 cents, a year earlier. The losses per share were 20 cents worse than projected by analysts, who were looking for red ink of just 68 cents a share.
Revenues for the three months ended Oct. 31 rose 1.8 percent to $357.5 million from $351 million as comparable-store sales gained 3.9 percent — the eight consecutive quarter of comp gains.
The remnants of Hurricane Sandy cost Zale about $1 million in revenue in the quarter, plus another $2 million in early November.
First-quarter results were also impacted by selling, general and administrative, which increased to $206 million from $200 million due to increase costs for employee health care benefits.
On a conference call with analysts late Tuesday, chief executive officer Theo Killion, said, “We focused our efforts on setting the foundation for the important holiday selling season. First and foremost, we continued to improve our merchandise assortment. This includes fine-tuning our core products, while expanding exclusive and proprietary collections in both bridal and fashion.”