Charlotte Russe 3Q profit slips on charges

SAN DIEGO — Teen clothing chain Charlotte Russe Holding Inc. said Tuesday its fiscal third-quarter profit fell 5 percent, as some one-time charges offset improving sales.

The company earned $6.3 million, or 29 cents per share, compared with $6.6 million, or 31 cents per share a year earlier. Charlotte Russe said it took $1.3 million in costs related to putting itself up for sale, management transition and severance.

Revenue rose 5 percent to $202.7 million, compared with $193.2 million in the same period last year.

Analysts surveyed by Thomson Reuters, on average, expected a profit of 24 cents per share on $207.6 million in sales. The estimates usually exclude one-time charges.

Same store sales, or sales at stores open at least a year, fell 3.6 percent in the period. These are considered a key measure of a retailer’s performance since they measure sales at existing, rather than newly opened, stores.

The company said sales were helped because it had to make fewer markdowns on merchandise.

“Although the environment remains extremely challenging, we believe there is a tremendous opportunity for Charlotte Russe to improve its leadership position in the fast fashion category,” CEO John D. Goodman said. “We’re continuing to manage the business conservatively by controlling inventories, conserving costs and prudently investing in the resources, talent and systems necessary to help take the Charlotte Russe brand to the next level.”

Charlotte Russe, which had been working on turnaround efforts for about a year, opposed a takeover offer by investment firms KarpReilly and H.I.G. Capital in November, saying it wanted to stick to its plan. Some shareholders complained about that decision, and the company decided to put itself up for sale.

Shares rose 18 cents to $12.25 in after-hours trading. The stock closed down 43 cents, or 3.4 percent, at $12.07 in the regular session.