Talbots Reports Net Loss in Q2

by MR Magazine Staff

HINGHAM, Mass. – Talbots, Inc. is reporting a net loss of $13.3 million (25 cents per share) in the second quarter, compared to a net loss of $3.9 million (seven cents per share) in the second quarter last year. As in last year’s second quarter, the company points to acquisition and financing costs as part of the problem – 10 cents per share this quarter and 14 cents per share last year.

Sales were down in the Talbots stores: $392 million for this quarter versus $404 million last year. Sales were up for J. Jill stores, though: $80 million this quarter versus $73 million last year. Direct marketing sales, which include catalog and Internet, were up slightly: $100 million versus $95 million last year. Consolidated total sales were $572 million.

However, total same store sales across the company fell 4.8 percent this quarter, the company reported.

“We are clearly disappointed in our second quarter performance, which reflected in part a weak customer response to our spring and summer assortments at both brands,” said Talbots CEO Arnold B. Zetcher. “Although we experienced a modest increase in transactions in the quarter, the increase was more than offset by a decline in average transaction value, resulting in negative comparable store sales. We also believe that our business was affected by a shift in consumer sentiment, given the significant uncertainty in the macro environment, which led to lower levels of regular price selling.”