(By Balachander) Zale Corp. (NYSE: ZLC) said holiday sales rose 2.3 percent and the jewelry retailer still forecasts positive net income for fiscal 2013.
At constant exchange rates, the company said comparable store sales grew 1.6 percent for the holiday selling period, versus a rise of 6.2 percent in the same period last year.
Revenue for the combined months of November and December rose $3 million to $567 million, with revenue related to the net decrease of 50 stores offsetting comps growth.
Zales branded stores comps grew 3.1 percent and Canadian Fine Jewelry brands posted comps gain of 2.7 percent.
Zale's Kiosk Jewelry business Piercing Pagoda registered comps growth of 1.7 percent.
For the second quarter ending Jan. 31, the company forecasts gross margin to be in line with 50.5 percent posted a year ago and operating margin to improve 100 basis points to 7.5 percent.
"This holiday season, we focused on driving bottom line improvement," said Zale CEO Theo Killion. "Our comp performance, combined with an expected 100 basis point operating margin improvement, brings us closer to our goal of achieving positive net income for the fiscal year."
Earlier today, bigger peer Tiffany & Co. (NYSE: TIF) forecast full-year profit at the lower-end of its guidance, saying holiday period sales growth was at the low-end of its expectations. For the two-month period ended December, the jeweler said worldwide net sales grew 4 percent to $992 million. Comparable store sales were unchanged from the prior-year period on a constant-exchange-rate basis.
The stock, which has been trading in the 52-week range of $2.18 to $7.66, closed at $4.19 on Wednesday.