Fine jewelry specialty retailer Zale Corp. said Wednesday that its adjusted net earnings of totaled $88.1 million for the second quarter ended Jan. 31, compared with $87.8 million during the same quarter of the prior year.
The Dallas-based company said it would have earned $94.8 after excluding expenses of a change in accounting and the way it counts revenue from selling product-guaranty plans.
Revenue grew 1 percent to $1 billion from $993.7 billion a year ago, which excludes results of the Bailey Banks & Biddle stores that were closed during the second quarter of 2006.
Same-store sales grew 1.4 percent during the quarter.
“While not reaching our original expectations for the quarter, I’m pleased with the progress we’ve made,” said Betsy Burton, Zale Corp. chief executive officer. “At the Zales brand, we had our first comparable store increase in three years and our first increase in operating earnings in four years. Customers reacted favorably to our expanded assortment in our core diamond fashion and bridal categories as well as our marketing repositioning.”
Burton continued, “While we gave back margins due to aggressive pricing and increased promotional activity at Holiday, in January we changed our focus to maximizing gross profit dollars. In the second half, we will continue maximizing gross profit dollars as well as focus on expense reduction, particularly those investments in payroll and marketing that did not generate sufficient sales gains to justify.”