Zale Corp Earnings: Revenue Increase Helps Margin, Net Income Climbs

The Cheat Sheet

Zale Corporation reported its results for the second quarter. Zale is a specialty retailer of fine jewelry. It operates specialty retail jewelry stores and kiosks located mainly in shopping malls throughout the United States, Canada and Puerto Rico.

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Zale Earnings Cheat Sheet for the Second Quarter

Results: Net income for Zale Corporation rose to $28.8 million (77 cents per share) vs. $27.2 million (73 cents per share) in the same quarter a year earlier. This marks a rise of 6% from the year-earlier quarter.

Revenue: Rose 6% to $663.8 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Zale Corporation fell in line with the mean analyst estimate of 77 cents per share. Analysts were expecting revenue of $657.4 million.

Quoting Management: “Because of the importance of the holiday selling period to our business, the positive same store sales we’ve achieved over the past two years is significant,” commented Theo Killion, Chief Executive Officer. “Our consistent top line growth is a result of the work we’re doing to return the Company to profitability.”

Key Stats:

Revenue has risen the past four quarters. Revenue increased 7.3% to $351 million in the first quarter. The figure rose 9.4% in the fourth quarter of the last fiscal year from the year earlier and climbed 14.5% in the third quarter of the last fiscal year from the year-ago quarter.

The company met estimates last quarter after toppling them in the two previous quarters. In the first quarter, it topped the mark by 25 cents, and in the fourth quarter of the last fiscal year, it was ahead by 10 cents.

ZLC’s profit in the latest quarter snaps a three-quarter streak of losses. The company reported a net loss of $31.9 million in the first quarter, a loss of $32.6 million in the fourth quarter of the last fiscal year and a loss of $9 million in the third of the last fiscal year.

Looking Forward: Expectations for the company’s next-quarter performance are higher than they were ninety days ago. The average estimate for the third quarter is now at a loss of 18 cents per share, up from a loss of 30 cents. For the fiscal year, the average estimate has moved from a loss of 47 cents a share to a loss of 99 cents over the last sixty days.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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