Finlay Holiday Same-Store Sales Down 6%

Finlay Enterprises, Inc. said Thursday that same-store sales for Finlay Fine Jewelry Corp., its wholly owned subsidiary, dropped 5.9 percent for the November-December holiday period. Sales for the two-month period increased 26.9 percent to $349.1 million, year-over-year.
The sales results are on a continuing operations basis, which excludes sales from discontinued Macy’s, Belk’s, and Parisian stores. Specialty jewelry stores consisting of Carlyle, Congress, and Bailey Banks & Biddle, which were acquired in November 2007, contributed sales of $130.4 million for the two-month period, as compared to $43.7 million for the same period last year.
On a continuing operations basis, sales for the 11-month period ended Jan. 5, increased 13.7 percent to $801.9 million, year-over-year. Specialty jewelry stores contributed sales of $208.3 million for the 11-month period, as compared to $100.2 million in 2006. Same-store sales for the 11-month period decreased 1 percent on a continuing operations basis. Including discontinued stores, same-store sales for the 11-month period decreased 0.6%.
“We are disappointed with our results for the holiday period, which were negatively impacted by weak consumer confidence and a difficult retail environment,” said Arthur E. Reiner, Finlay Enterprises, Inc. chairman and chief executive officer. “Despite these challenges, we continue to conservatively manage our expense structure and our inventory. Having completed our recent financing of our revolving credit facility, we are highly focused on integrating the recently acquired Bailey Banks & Biddle business, which we expect will be a significant contributor to our profitability in the future.”
In related news, Standard & Poor’s Ratings Services said it has cut its corporate credit rating on Finlay Enterprises Inc. and its wholly owned unit Finlay Fine Jewelry Corp to ‘B-‘ from ‘B’, Thompson Financial reports.
S&P said the downgrade reflects the New York-based company’s weak operating performance and concerns regarding the renewal of department store leases and its limited history in operating free-standing retail stores.
The ratings agency said it has also lowered the company’s senior unsecured rating to ‘CCC+’ from ‘B-‘ and removed all ratings from negative watch, where they were placed on Sept 27 last year after Finlay executed an asset purchase agreement with Zale Corp. for Bailey Banks & Biddle.
The rating outlook is negative.
Finlay Enterprises, Inc. is a retailer of fine jewelry operating luxury stand-alone specialty jewelry stores and licensed fine jewelry departments in department stores throughout the United States.