Zale Corp comp-store Q4 sales rise 0.3%

31 Aug '05

4 min read

The Company also provided its forecast for its fiscal year ending July 31, 2006. For the full year, it currently expects revenue growth of 5.0 percent to 7.0 percent. These revenue expectations do not reflect the impact of the Bailey Banks & Biddle store closings discussed above, as the timing of the planned closings has not been finalized. Included in the revenue projections are a comparable store sales increase of 2.5 percent to 3.5 percent and square footage and other growth of 2.5 percent to 3.5 percent. The Company plans to open 65 stores and 40 kiosks during the year.

Earnings per diluted share is expected to grow 5 percent to 7 percent including the impact of the $13 million charge for the Bailey Banks & Biddle store closings, an estimated $5 million stock compensation expense outlined above, each net of tax, and a potential income tax benefit of up to $10 million based on the estimated range of earnings per diluted share to increase 12 percent to 14 percent. Free operating cash flow is expected to reach $100 million for fiscal year 2006.

Separately, as part of its ongoing strategy to return value to its shareholders, the Company announced that its Board of Directors has approved a stock repurchase program pursuant to which the Company, from time to time and at management's discretion, may purchase up to an aggregate of $100 million of Zale common stock on the open market.

The Company also announced that it will be presenting at the Goldman Sachs Retailing Conference on Wednesday, September 7, 2005, at 2:00 p.m. Eastern Time. Ms. Forte and Sue E. Gove, the Company's Chief Operating Officer, will discuss Zale's strategic plan.

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