Zale Corp., a leading specialty retailer of fine jewelry in North America, reported Thursday that same-store sales decreased 0.4 percent for the first quarter ended Oct. 31. Revenues fell 1.2 percent to $378 million.

These results exclude revenues from the Bailey Banks & Biddle stores. Zale entered into a definitive agreement to sell the high-end jewelry chain to Finlay Fine Jewelry Corp. and expects to complete the transaction “in the near future.” Including Bailey Banks & Biddle, comparable store sales decreased 0.3 percent and revenues for the first quarter fell 1 percent to $428 million.

Cash from warranty sales, which exclude Bailey Banks & Biddle, increased $9.5 million over the first quarter last year and revenues recognized were $6.1 million less than the prior year as a result of the change made in the jewelry protection plan offering during the second quarter of fiscal 2007 from a two-year to a lifetime agreement, the Dallas-based specialty retail jeweler said.

“We continue to execute our strategy of maximizing gross margin dollars and maintaining good expense control in the current challenging macro environment,” said Betsy Burton, Zale chief executive officer. “This is demonstrated by the fact that even with relatively flat sales this quarter, we expect to achieve our earnings objectives.”

Zale Corp. is a leading specialty retailer of fine jewelry in North America operating over 2,250 retail locations throughout the United States, Canada, and Puerto Rico, as well as online. Its brands include Zales Jewelers, Zales Outlet, Gordon’s Jewelers, Peoples Jewellers, Mappins Jewellers, and Piercing Pagoda. Zale also operates online at www.zales.com, www.baileybanksandbiddle.com and www.gordonsjewelers.com.

JCK