Zale Corp. Sales Up, Losses Decline

Zale Corp. on Wednesday said year-over-year third quarter revenues increased 14.5 percent to $412 million. Same store sales for the period ended April 30, increased 15.2 percent, compared to a decrease of 2.2 percent during the same period last year. At constant exchange rates, which exclude the effect of translating Canadian currency denominated sales into U.S. dollars, same store sales increased 14.2 percent for the quarter.

The specialty jewelry retailer with operates jewelry chains in the U.S., Canada and Puerto Rico reported a net loss from continuing operations of $10 million in the third quarter, compared to a net loss from continuing operations of $15 million in the comparable quarter last year.

For the quarter, gross margin on sales was $206 million, an increase of 13 percent compared to $183 million in the same period last year. The company achieved gross margin on sales of 50.1 percent, compared to 50.8 percent in the comparable quarter last year.

“We continue to make progress in our multi-year initiatives to return the company to profitability,” said Theo Killion, Zale Corp. CEO. “Our results validate that the work we’ve done to improve our marketing, our product and our guest experience is beginning to take hold.”

Zale Corp. operates approximately 1,845 retail locations throughout the U.S., Canada and Puerto Rico, as well as online. The company’s brands include Zales Jewelers, Zales Outlet, Gordon's Jewelers, Peoples Jewellers, Mappins Jewellers and Piercing Pagoda.

Signet, Zale Post Strong Holiday Sales Gains

Kay, the largest specialty retail jewelry brand in the US based on sales, is owned by Signet Jewelers.

The two largest jewelry chains in the U.S. both posted year-over-year gains for the nine-week holiday season, ended January 1.

Signet Jewelers Ltd., the world’s largest specialty retail jeweler, said Tuesday that U.S. sales increased by 11.7 percent for the period. The Bermuda-based company also has jewelry retail chains in the U.K. and that part of the business posted a 4.2 percent decline for the period, due to the negative impact of adverse winter weather (originally reported as a 4.2 percent increase, we regret the error).

Total holiday sales increased 8.1 percent with same store sales for the period up by 11.7 percent, following a 7.5 percent rise during the 2009 holiday season.

Signet operates 1,874 specialty retail jewelry stores including 1,330 stores in the U.S., where it owns stores under the Kay Jewelers, Jared The Galleria Of Jewelry and a number of regional names. The company also operated 544 stores in the UK, where it operates as H.Samuel, Ernest Jones and Leslie Davis.

Meanwhile, Zale Corp. said Tuesday that same store sales increased 8.5 percent for the holiday period of November and December 2010. At constant exchange rates (which excludes the effect of translating Canadian currency denominated sales into U.S. dollars), same store sales increased 7.6 period for the holiday selling period. Total revenues for the two-month period increased 8 percent to $533.1.

U.S. Fine Jewelry brands (which operate as Zales Jewelers, Zales Outlet and Gordon's Jewelers) had an increase in same store sales of 7.5 percent.

Canadian Fine Jewelry brands (consisting of Peoples Jewellers and Mappins Jewellers) had an increase in same store sales of 15.6 percent (up 10.2 percent at constant exchange rates).

Kiosk jewelry same store sales from its Piercing Pagoda business increased 4.2 percent.

“The Holiday sales results represent progress as we continue to stabilize the business and return to profitability,” said Theo Killion, Zale Corp. CEO. “The investments we've made in our field teams, the clarity of our marketing message and our back to basics merchandising strategy were validated by our guests during the most critical selling period of the year.”