• Swings to Q1 loss of $2.6m 
  • Sales fell 7.3% to $117.1m 
  • Gross margin down to 36.1% 

US fashion retailer Bebe Stores has swung to a first-quarter net loss on the back of increased markdowns and lower sales.

Net loss reached US$2.6m during the quarter ended 29 September, compared to a net income of $2.4m in the same period last year. It also fell to an operating loss of $3.9m, compared to an income of $3.4m a year ago.

Net sales slipped 7.3% to $117.1m, while comparable store sales fell 8.7%, compared to a 7% increase last year.

Gross margin as a percentage of sales slumped to 36.1%, compared to 40% last time. Bebe Stores said the decline was primarily due to increased markdowns and unfavourable occupancy leverage.

The company closed seven Bebe stores and closed five 2b stores during its first quarter.