Off-price footwear retailer Shoe Pavilion Inc has returned to profit in the second quarter, helped by fewer markdowns.

Net income was $694,000 for the three months ended3 July 2004 compared to a net loss of $231,000 in the same period last year.

Net income for the six months was $1.0 million versus a net loss of $1.5 million in 2003.

Comparable store net sales increased 1.6 per cent for the second quarter. Net sales dropped 2.0 per cent to $20.7 million from $21.2 million.

Comparable store net sales for the six months ended July 3, 2004 increased 3.7 per cent from the same period last year. Net sales for the six months were up 1.4 per cent to $40.3 million.

The Californian company operates 85 stores in California, Washington, Oregon and Arizona.