Jewelry retailer chain Zale Corp. said Monday that fourth quarter sales fell 3.4 percent, year-over-year, to $345 million. Same store sales for the period ended July 31, dropped 2.1 percent, compared to a decrease of 21.2 percent during the comparable period in the prior year.
The Dallas-based company reported a net loss for the quarter of $28.5 million, compared to a net loss of $89.8 million during the fourth quarter of the prior year. The overall loss was not as drastic than the prior year period due to cost cutting and a reduction in discounted merchandise.
"Earlier this year, we began executing our multi-year turnaround strategy," said Theo Killion, Zale CEO. "Our results, which show significant progress year over year, also serve as an objective reminder of how far we need to go to reach our ultimate goal; profitable revenue growth."
Killion was named CEO September 23. He replaced Richard C. Breeden, whose holding company, Breeden Capital Management, holds a majority stake in Zale. Breeden announced his resignation from the company the same day. Also resigning was James Cotter. Both joined the company in January 2008, when Breeden purchased a majority stake in the company.
Killion joined Zale Corp. in January 2008 as executive vice president and was appointed president in August 2008. Previously, he held senior management positions at Tommy Hilfiger, Limited Brands, Macy's East and the Home Shopping Network.
In addition, Kenneth B. Gilman, a retail industry veteran, joined the company's board as an independent director. His experience includes 25 years at Limited Brands, Inc., serving in numerous capacities.
In other Zale Corp. news:
* It has selected Citibank (South Dakota), N.A. to continue to provide private label credit for the retailer's Zales, Zales Outlet and Gordon's brands, effective October 1, 2010.
* It has amended its credit agreement with Golden Gate Capital to eliminate the minimum covenant on its term loan. In return, Zale will pay $25 million, including $11.3 million on its outstanding balance, $1.25 million as a prepayment and $12.5 million as an amendment fee.
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