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RAPAPORT... DGSE Companies Inc. reported a loss of $798,000 in the first quarter that ended on March 31. Revenue fell 29 percent year on year to $12.9 million, which DGSE attributed to continued sales declines from its bullion and scrap businesses, coupled with "an unusually challenging quarter" for jewelry sales. Nonetheless, DGSE improved gross profit as a percent of revenue to 18.1 percent compared with 17.8 percent one year earlier.
Dusty Clem, DGSE's chairman of the board and CEO, said, “The first quarter of 2015 was an extremely challenging quarter. In 2014, we successfully focused our marketing, merchandising and operating efforts on growing our jewelry, watch and diamond businesses and were rewarded with double-digit growth in those areas. In the first quarter of 2015, for the first time in several quarters, we were not able to grow these lines, and in fact saw declines.”
He added that while the first quarter represented "a setback" to create a consistently profitable environment, DGSE believes that growing the jewelry business and closely managing expenses provides the best avenue to offset the industry-wide slowdown in the bullion and scrap businesses.
“We clearly are not satisfied with our current results and are continuing to make adjustments to the business, in order to regain profitability in a very difficult environment for our industry. We continue to contemplate a wide range of options that we believe will increase the company’s value,” Clem said.
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