Finlay First Quarter Sales Up, Profits Down

Finlay Enterprises, Inc. reported Thursday that its sales increased 11.4 percent to $166.4 million for the first quarter ended May 5. Specialty jewelry stores consisting of Carlyle and Congress contributed sales of $27.2 million in the quarter, as compared to $17.5 million in the same period last year.

Same-store sales for the first quarter increased 8.1 percent. The company estimates the calendar shift associated with Mother’s Day coming a week earlier this year had an approximate 3 percent to 4 percent positive impact on first quarter same-store sales and will negatively impact second quarter sales by a similar amount.

Finlay, a leading retailer of fine jewelry and the largest operator of licensed fine jewelry departments in department stores throughout the United States, reported a loss for the quarter from continuing operations of $7.6 million, compared to a loss of $6.3 million in the first quarter of fiscal 2006. Results from operations before depreciation and amortization expenses for the first quarter improved to a loss of $1 million, compared to a loss of $1.5 million in the prior year period.

“While we were pleased with our comparable store sales increase for the quarter, our overall results reflect lower volume than anticipated at doors open less than a year, including our Congress stores,” said Arthur E. Reiner, Chairman and Chief Executive Officer of Finlay Enterprises, Inc. “We continue to view this year as a transitional period for our company, as we absorb the impact of store closures and expand our presence in the specialty jewelry store sector. We remain focused on our disciplined approach to managing our operating expenses and inventory levels. Further, the steps we have taken to diversify our revenue streams are generating results and we continue to be encouraged by the performance in the luxury sector, including our Carlyle stores and our Bloomingdale’s departments.”

The company projects that total sales for the second quarter to be in the range of $145 to $155 million. Sales for the fiscal year are projected to range from $770 million to $790 million, excluding the company’s Parisian store group.

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