A double-digit drop in sales fuelled a first quarter loss of US$1.3m for Tandy Brands Accessories.

The US accessories specialist saw net sales in the three months to 30 September fall 12.4% to $34.6m, although it did narrow its loss to $1.3m from $1.7m for the same period last year.

Tandy said it had added a new ladies' belt line with a major retail customer, and pledged to continue to expand distribution of its Totes gift products at mass merchants and department stores.

"The decline in net sales is a direct result of the current difficult retail environment as several customers continue to be very cautious in expanding inventories going into the holiday season," said JSB Jenkins, chairman of the company.

"In addition, first quarter 2009 net sales were impacted by the timing of product shipments to certain customers that moved from the first quarter last year to the second quarter this year."

Jenkins said the company remained "cautious and conservative" in its approach to the market, but added that it felt it had the financial strength and flexibility to continue to support its customers.