Fashion retailer Charlotte Russe declares Q2 results

20 Apr '06

3 min read

San Diego based growing mall-based fashion retailer Charlotte Russe Holding Inc reported financial results for the second quarter of fiscal 2006 ended March 25, 2006. In addition, management announced that it is evaluating strategic alternatives for the Rampage chain, which has been undergoing a brand repositioning for the past two years.

As has been the Company's policy, this guidance does not include the potential of any business risks, opportunities or developments that may occur after April 20, 2006. Management does not expect to report on its third quarter financial performance, or to comment on it to the investment community, until after the financial results for the third quarter have been released on or about July 20, 2006.

Financial Results:
Net sales for the second quarter increased 34.7 percent to $171.1 million from $127.0 million for the second quarter last year. Comparable store sales increased 16.6 percent during the quarter, compared to a decrease of 3.1 percent for the second quarter of fiscal 2005.

Net sales for the first 26 weeks of fiscal 2006 were $372.5 million, an increase of 34.5 percent from $277.0 million for the same period last year. Comparable store sales increased 16.1 percent during the 26-week period, compared to a decrease of 6.8 percent that was reported for the same period last year.

The operating loss for the second quarter was $19.7 million as compared to a loss of $1.4 million for the same quarter last year. These results reflect a $22.5 million pre-tax and non-cash write down of the Rampage chain's long- lived assets pursuant to management's analysis of estimated future cash flows for related store locations. In addition, the second quarter results reflected a cumulative pre-tax adjustment for gift card income of $2.0 million. Excluding these two adjustments, operating income for the second quarter was $0.8 million as compared to a loss of $1.4 million for the same quarter last year.

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