Claire's Q3 consolidated same store sales decline

15 Dec '07

4 min read

Claire's Stores Inc a leading specialty retailer offering value-priced jewelry and accessories, reported its financial results for the third quarter of Fiscal 2008, which ended November 3, 2007.

The Company reported net sales of $357.4 million for the quarter, a 2.8% increase over the third quarter of Fiscal 2007, which ended October 28, 2006.

The increase was primarily attributable to the growth in our new store base, particularly in Europe, and foreign currency translation gains, offset by a slight decrease in same store sales.

A 0.5% increase in our average sale per transaction was insufficient to offset a 3.5% decline in the average number of transactions per store.

Third quarter consolidated same store sales declined 0.7%. In North America, same store sales decreased 1.0% versus last year's third fiscal quarter.

European same store sales were essentially flat with last year's third fiscal quarter, at negative 0.1%. Please note that we compute same store sales on a local currency basis, and as such they are not impacted by changes in foreign exchange.

Commenting on third quarter results, Chief Executive Officer Gene Kahn said, "This quarter concludes my first full quarter as Claire's CEO. Our third quarter results are reflective of a softening retail environment.

In response to consumer demand, we began to shift our product mix from jewelry to accessory classifications in order to capitalize on the strength of handbags, fashion accessories and cosmetics as we completed Back to School and transitioned into Fall.

Jewelry sales are currently challenging, except among our younger customers. Our repositioning of Icing is still in its early stages as we work to refine and improve the concept and content.

Our merchandise margins improved and through disciplined buying and markdown activity, inventory levels remained low and fresh."

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