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alstry (35.87)

Giving Away the Store???

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May 08, 2008 – Comments (2)

From MarketWatch in February:

 Zale Corp. plans actions to save about $65 million a year, including eliminating 20% of its headquarters staff, or 140 filled and 85 open positions. The Dallas jewelry company said it plans to close 23 stores in fiscal 2008, bring the total to 105 closed stores for the fiscal year ending July 31.

 

From MarketWatch this morning:

Zale Corp.'s fiscal third-quarter same-store sales, or sales at stores open at least one year, rose 5.8% from a year earlier. Revenue for the Dallas fine jewelry retailer grew 6.3% to $477 million in the quarter ended April 30 from $449 million a year ago, helped by an "aggressive" clearance strategy. Zale expects a third-quarter loss from continuing operations of 40 cents to 45 cents a share. The company results of Bailey Banks & Biddle, which was sold in November, have been excluded from the results for both the current and comparable periods.

 

Think!!!

You close 15% of your underperforming stores and "aggressively" price merchendise at the remaining stronger performing stores and what do you think same store sales will do?  Now profits is another matter, and the results show it.

Yippeee, sales are up giving away merchendise....who cares about profits.

2 Comments – Post Your Own

#1) On May 08, 2008 at 8:12 AM, Gemini846 (65.29) wrote:

That's what happens when you are over-leveraged and cash poor. You have to get money somewhere. I learned this the hard way first hand, and vowed never to do something stupid like that again.

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#2) On May 08, 2008 at 8:42 AM, abitare (94.84) wrote:

Nothing says "I love you" like a superficial and overvalued rock, clawed from the guts of the earth by slave labor.

http://www.the7thdimension.com/2008/02/nothing-says-i-love-you-like-diamonds.html 

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