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Wet Seal net sales drop in Q3

Foothill Ranch, Calif. – The Wet Seal reported net sales of $127.7 million during the third quarter of fiscal 2013, down 5.8% from the same quarter in the prior year. In a partial release of third quarter figures, the company also reported a 0.8% increase in same-store sales.

E-commerce sales, which are not a component of same-store sales, declined approximately 19% for the quarter. Through more disciplined management of promotional pricing, the company generated an improved e-commerce merchandise margin rate compared to the same quarter of last year. However, Wet Seal said the focus on transitioning to a new Demandware e-commerce platform during the quarter impacted sales results. The re-platform was completed in late October and is now enabling customers to execute transactions more efficiently from their mobile devices.

“We were able to deliver positive comp store sales and significantly improved merchandise margins versus a year ago despite the extremely tough retail environment,” stated John D. Goodman, CEO. “As we prepare for the upcoming holiday season, we are maintaining an appropriate mix of regular and promotional pricing and remaining sharply focused on inventory management. At quarter-end, inventory dollars per square foot were down approximately 3% compared to the prior year at Wet Seal and approximately 20% versus the prior year at Arden B. We are also continuing to exercise strict control over costs, resulting in a decrease in SG&A expenses versus the prior year period.”

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