RAPAPORT... Zale's second-quarter revenue rose 6 percent year on year to $663.8 million while cost of sales rose by 5.4 percent to $328.3 million for the three months that ended on January 31. Revenue included $12.6 million resulting from the previously disclosed change in warranty revenue recognition.
Same-store sales rose 6 percent. Gross margin as a percentage of revenue improved to 50.5 percent from 50.3 percent. Profit for the period, which included the important Christmas season, rose 6 percent to $28.8 million. Inventory on January 31, stood at $815 million compared with $777 million one year ago.
''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 are significant,'' said Theo Killion, Zale's chief executive. ''Our consistent top line growth is a result of the work we’re doing to return the company to profitability.''