Net sales for the first quarter of fiscal 2013 were $117.1 million, decreased 7.3% from $126.3 million reported for the first quarter a year ago. As previously reported, comparable store sales for the quarter ended September 29, 2012 decreased 8.7% compared to an increase of 7.0% in the comparable period of the prior year driven by the deceleration in store traffic.
Gross margin as a percentage of net sales decreased to 36.1% in the first quarter of fiscal 2013, compared to 40.0% in the first quarter of fiscal 2012. The decrease in gross margin as a percentage of net sales was primarily due to increase in markdowns coupled with unfavorable occupancy leverage.
SG&A expenses were $46.2 million, or 39.4% of net sales, compared to $47.0 million, or 37.3% of net sales for the same period in the prior year. The dollar decrease in SG&A expenses was primarily driven by decrease in compensation expense.
The effective tax rate for the first quarter of fiscal 2013 was 30.0% compared to 37.2% in the first quarter of fiscal 2012. The lower tax benefit in the current first quarter compared to the tax expense in the prior year period was due to various discrete items including a valuation allowance against a foreign NOL incurred during the quarter.
Net loss for the first quarter of fiscal 2013 was $2.6 million or $0.03 per share on 84 million shares outstanding compared to net income of $2.4 million or $0.03 per diluted share on 84 million shares outstanding for the same period of the prior year.
During the quarter ended September 29, 2012, the Company opened 5 2b stores and closed 7 bebe stores.
For the current quarter the Company’s capital expenditures were approximately $8.2 million and depreciation expense was approximately $5.1 million.
For the second quarter of fiscal 2013, we currently anticipate comparable store sales in the negative low to mid-single digit range. Depending on actual sales and markdowns, results are expected be in the range of a net loss of $0.01 to net income of $0.03 per diluted share based on 84 million weighted average shares outstanding versus net income of $0.08 per diluted share based on 84 million weighted average shares outstanding in the second quarter of fiscal 2012. In the current quarter, we will continue to see lower gross margin rate and an increase in SG&A as a percent of sales. The Company is currently anticipating an effective tax rate of approximately 41% for fiscal 2013.
Finished goods inventories per square foot as of the end of the second quarter of fiscal year 2013 are anticipated to increase in the mid-teen range given the increase in average unit cost for elevated product offerings, additional spring receipts, localization strategy, and inventory in the prior year comparable period was below projection.
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