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Wet Seal reports Q3 loss per diluted share of $0.04

29 Nov '07

3 min read

The Wet Seal Inc announced results for its third fiscal quarter ended November 3, 2007, and provided guidance for its fourth fiscal quarter.

• Reports third quarter loss per diluted share of $0.04
• Introduces fourth quarter earnings per diluted share guidance of $0.03 to $0.06

Third Quarter Financial Results:
As previously announced, net sales for the 13-week period ended November 3, 2007, were $150.3 million compared to net sales of $143.3 million for the 13-week period ended October 28, 2006. Comparable store sales for the 13-week period ended November 3, 2007 decreased 3.4%. The Company reported a 7.3% comparable store sales increase for the 13-week period ended October 28, 2006.

Net loss for the quarter was $3.3 million, or $0.04 per diluted share. Results include an asset impairment charge of $1.6 million, or $0.02 per share. This compares to prior year third quarter net income of $2.4 million, or $0.02 per diluted share.

The prior year results include non-cash stock compensation charges of $4.4 million related to performance shares granted to a merchandise consultant formerly used by the Company and a non-cash interest charge of $0.1 million associated with conversions of the Company's Convertible Notes.

The Company ended the third quarter with $80.1 million of cash and marketable securities and $3.4 million of long-term debt, comprised of Convertible Notes, net of discount.

Ed Thomas, chief executive officer, commented, "While we were within our comparable stores sales expectation as updated in early October, earnings were below plan as we took aggressive markdowns on inventories to ensure we entered the holiday season with a fresh and clean merchandise assortment.

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