Apparel retailer Charming Shoppes reported a net loss before extraordinary gain of $87.7m for the 2007 fiscal year, due to one-time charges, a decline in gross margins and negative expense leverage on lower than planned sales.

This compares to net income of $108.9m during the last fiscal year.

The 2007 fiscal year results included non-cash asset impairment charges and non-cash write downs primarily of store assets in the amount of $105.7m, the company said.

Net sales for the fifty-two weeks decreased 2% to $3.01bn, compared to net sales of $3.07bn last year

The company reported a net loss before extraordinary gain of $128.7m in the fourth quarter, compared to net income of $24.9m in the prior year period. This included non-cash asset impairment charges and non-cash write downs, primarily of store assets, in the amount of $105.7m after-tax, the company said.

Net sales for Q4 decreased 10% to $784.9m.

Dorrit J Bern, chairman, chief executive officer and president of Charming Shoppes, said: "Clearly, our performance during the fourth quarter was extremely disappointing, and was impacted by downward traffic trends and response rates to our stores and catalogues, which we continue to experience."

The company reported plans to relocate a decrease of approximately $40m, or 30%, in the capital budget for fiscal year 2009, primarily through a 50% reduction in the number of planned store openings as compared to fiscal year 2008.

The company's store openings in fiscal year 2009 will be mainly focused on its largest core brand, Lane Bryant, it said, opening approximately 45-55 new stores, relocating approximately 48-62 stores, and closing approximately 150-170 stores in fiscal year 2009.

For the three month period ending 3 May, the company has projected a diluted loss per share in the range of $0.06 to $0.08, compared to diluted earnings per share of $0.20 for the corresponding period last year.

Bern added: "Given the current uncertain economic climate and our expectations for continuing weak traffic trends, we have taken a conservative stance in our planning for fiscal year 2009. We believe difficult retail apparel trends will continue at least through the first half of the year. In response, we will continue to reduce operating expenses and manage inventory tightly, in an effort to protect our gross margin and operating margin through this difficult period, to ensure profitability for fiscal year 2009."