Trendy fashion retailer The Wet Seal Inc announced a net loss from continuing operations of $11.7 million for the 13-week period ended July 30, 2005. Included in the net loss was a $16.1 million charge associated with its previously announced agreement with Michael Gold. The charge for Michael Gold included $2.1 million in cash compensation and $14.0 million in non-cash stock compensation.
In addition, the current quarter net loss included $0.6 million in director and employee non-cash stock compensation charges and $0.9 million in non-cash interest charges. The current quarter net loss from continuing operations of $11.7 million compares to a net loss from continuing operations of $106.2 million for the same period last year.
The prior year's net loss for the 13-week period ended July 31, 2004 included a non-cash impairment charge of $40.4 million for certain long-lived assets and the establishment of a non-cash tax valuation allowance against the Company's deferred tax assets of $38.9 million.
The Company ceased recognizing tax benefits related to its operating losses beginning with its second quarter last year. Results for the 13-week period ended July 31, 2004 have been restated in connection with the Company's previous review of lease accounting transactions.
Mr. Joel Waller, Chief Executive Officer, stated, "Company accelerated sales growth and operating margin improvements have led to a significant improvement in operating results.Before non-cash compensation charges, delivered operating income of $4.2 million. The additional funds from our previously announced May 2005 financing, the continued growth in same-store sales and improving operating margins have significantly improved our liquidity position."
marketing@alchempro.com
