Texas based chain of upscale ladies' and men's specialty apparel stores, Harold's Stores Inc announced operating results for the second quarter and year-to-date period ended July 30, 2005.
For the second quarter, the Company reported a net loss of $2.9 million, or $0.53 per share, compared to a net loss of $1.2 million, or $0.23 per share, in the same period of the previous year. During the year-to-date period ending July 30, 2005, the net loss was $2.1 million, or $0.46 per share, as compared to a net loss of $422,000, or $0.19 per share, in the same period of the prior year.
"Company second quarter loss was primarily a result of incremental markdowns taken during the quarter on ladies' spring and summer merchandise," said Leonard Snyder, Interim Chief Executive Officer. "Based on prior season successes, the Company increased purchases of ladies' apparel during spring season, but sales in ladies' apparel did not meet expectations. As a result, they marked down the merchandise and have been aggressive in their clearance activities. Fortunately, sales of this merchandise have been exceptionally strong during August and they anticipate that this merchandise will sell without significant additional markdowns." Snyder continued, "Customers' initial reactions to fall merchandise have been encouraging, and we continue to experience growth in the internet area of their business."
Net sales for the quarter were $20.3 million, compared to $19.3 million for the same period in the previous year, an increase of 5.2 percent. For the quarter, total Company comparable store sales were flat. Comparable store sales decreased 1.2 percent in the full-line retail stores during the quarter, while comparable store sales in the outlets increased 33.6 percent. The Company's direct sales (internet and catalog) were $670,000 during the quarter, five times last year's sales of $134,000. Additionally, the Company conducted a warehouse sale in July this year that was not held last year, resulting in $475,000 of additional sales.
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