Zale reports smaller quarterly loss

Jewelry retailer Zale Corp (ZLC.N) reported a smaller quarterly loss on Monday as same-store sales improved.

KEY POINTS

Q1 2011 Q1 2010

Revenue $351 mln $327 mln

Net loss $32 mln $98 mln

Loss per share 99 cents $3.05

* The loss of 99 cents per share from continuing operations compared with the average analyst forecast of a loss of $1.42 per share, according to Thomson Reuters I/B/E/S.

* Same-store sales rose 5.8 percent from a year earlier in the fiscal first quarter ended Oct. 31, compared with a decline of 1.1 percent in the same quarter of 2010.

MARKET REACTION

Zale shares were up 9 percent at $3.90 in after-hours trading.

BACKGROUND

* In late 2009, Zale faced a serious liquidity problem and lost shoppers to rival Signet Jewelers Ltd (SIG.N)

* Earlier this year, Zale said it would pass a portion of higher diamond, gold and silver costs, that have pressured margins, on to customers.

(Reporting by Alistair Barr; Editing by Ted Kerr)

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