Joe’s Jeans Inc.’s first quarter as the owner of Hudson Jeans exceeded expectations as strength in wholesale channels helped it overcome expansion costs and promotional pressures in its retail operations.

In the fourth quarter ended Nov. 30, the Los Angeles-based jeans firm registered a net loss of $1.8 million, or 3 cents a share, versus net income of $2 million, or 3 cents, in the 2012 period.

Eliminating expenses related to the acquisition and integration of Hudson and other special items, earnings per share were 3 cents, better than the 2-cent loss expected, on average, by analysts. Joe’s closed on its acquisition of its denim rival on Sept. 30.

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Sales were up 49.7 percent to $50.5 million from $33.7 million in the year-ago quarter and exceeded the analysts’ consensus estimate for revenues of $48.1 million. Eliminating $15.6 million in Hudson sales during its two months as part of Joe’s, revenues were up 3.4 percent to $34.9 million.

Wholesale volume and operating income improved 59.7 and 62.6 percent, respectively, to $42.8 million and $11.9 million, but gross margin contracted to 39 percent of sales from 41 percent in the 2012 period. Marc Crossman, president and chief executive officer, noted that margin suffered from a charge taken on Hudson inventory without which margins would have increased to 44 percent and to 42 percent for the Joe’s and Else brands.

Retail sales were up 11.2 percent to $7.7 million, but gross margin in the segment fell to 64 percent from 68 percent and Joe’s experienced an operating loss of $421,000, compared to operating income of $526,000. Joe’s store count grew to 34 stores from 28 in the 2012 quarter.

“We faced tough comparisons from strong holiday sales in the year-ago period,” Crossman said. “In addition, we were more promotional this quarter than the comparable quarter in order to keep pace with our competitors.”

He added that same-store sales had improved in the first quarter of 2014. Comparable sales for 2013 declined 5 percent.

For the full year, Joe’s had a net loss of $7.3 million, or 11 cents a diluted share, compared with net income of $5.6 million, or 8 cents, in the prior-year period. Revenues were up 18.2 percent to $140.2 million from $118.6 million.

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