Women's wear retailer AnnTaylor Stores Corporation has swung to a third quarter loss after a "dramatic deterioration" in consumer spending and warned of a weak holiday season.

For the three months to 1 November the company, which operates 966 stores, reported a net loss of $13.4m, or $0.24 per share, compared with a profit of $40.8m, or $0.66 per share, a year earlier.

Excluding restructuring charges related to "organisational streamlining" announced earlier this month and it decision in January to close 117 stores, it said earnings per share were break-even.

Ann Taylor president and chief executive officer Kay Krill anticipates a "very weak consumer environment" in the months ahead.

Net sales fell 12.3% to $527.2m from $600.9m, dropping 25.3% to $159.5m at the Ann Taylor division, and down by 11.4% to $263.0m at Loft.

Same-store sales for the quarter declined 19.4%, with Ann Taylor down 24.8% and Loft down 15.4%.

Aggressive promotional activity to move inventory meant that gross margin, as a percentage of sales, fell 7.3 margin points to 48.8%, compared with a gross margin of 56.1% in the year-ago period.

Total inventory per square foot at the end of the quarter was down 10% versus year-ago.

In its outlook, the company said it expects weak consumer spending to persist through the fourth quarter, which is also likely to remain "highly promotional."

It added that because of this uncertainty it is not providing earnings per share guidance for the fourth quarter or the full year - and has significantly scaled back capital spending for next year.