Harold's Stores Inc, a chain of upscale ladies' and men's specialty apparel stores, announced results of its first fiscal quarter ended April 29th 2006.
For the first quarter, the company reported a net loss of $931,000 or $0.21 per diluted and basic share, compared to net income of $782,000, or $0.04 per diluted share ($0.07 per basic share) in the previous year.
"We are disappointed in our first quarter financial performance," said Leonard Snyder, Interim CEO.
"Sales for the quarter were significantly below the levels of last year, which negatively impacted gross margin and expenses as a percentage of sales due to lack of leverage, leading to a loss for the quarter. Fortunately, sales improved as the quarter progressed, with a decline of 22.4 percent to last year during the first seven weeks of the quarter to a decline of only 0.8 percent in the final six weeks of the quarter. This is a result of improved customer acceptance to the late spring and early summer merchandise deliveries," he added.
Snyder continued, "At the end of the quarter, our merchandise inventories were 9 percent lower than the levels of last year, principally due to the reduced ownership of prior season inventory."
Further, Snyder said, "The company has addressed the issues it experienced with its merchandise offerings and flow for the remainder of the year. In addition to ensuring regular monthly merchandise flow, much more emphasis has been placed on classically-inspired, coordinated outfits for both ladies and men, merchandise that the company's customers have historically preferred."