Upscale apparel retailer Harold's Stores Inc has posted a third quarter net income of $1 million after a loss of $2.1m in the same period last year.

The Dallas-based company, which last reported profitability in the first quarter of 2000, attributed the upturn to strong regular price selling in its full-line retail outlets.

This factor also led to a same-store sales increase of 27.2 per cent year-on-year for the quarter.

Net sales, meanwhile, were up 11.7 per cent to $23.9m for the three-month period, compared to $21.4m in the same quarter a year earlier.

CEO Clark Hinkley said the company was "very pleased" with its third quarter performance.

"To achieve meaningful profitability for the first time in four years is a tribute to the hard work that all our associates have invested in this great brand, producing strong comparable store sales increases of 25.6 per cent," he said.

"Selling, general and administrative expenses were well controlled and declined significantly over the prior year.

"Our efforts to restructure and turn Harold's business are clearly visible at this juncture."

Harold's Stores operates 39 retail outlets across the United States.