(RTTNews) - Thursday, specialty retailer Wet Seal Inc. (WTSLA: News ), reported a decline in profit for the third quarter, reflecting a drop in revenues. Earnings for the quarter were inline with estimates, while revenues came in ahead of Street view. Wet Seal also initiated guidance for the fourth quarter, below the analysts current expectations.

The Foothill Ranch, California-based company's third quarter net income dropped to $4.51 million or $0.04 per share from $6.79 million or $0.07 per share for the year-ago quarter.

Net sales for the third quarter declined to $141.55 million from $146.64 million for the prior year quarter.

On average, seven analysts polled Thomson Reuters expected the company to earn $0.04 per share on revenues of $140.58 million for the third quarter.

Third quarter consolidated same-store sales declined by 6.2% year-over-year. Same-store sales for Wet Seal decreased by 7.6% from last year and for Arden B's same-store sales increased by 1.3% from same period last year.

Commenting on the third quarter results, Ed Thomas, chief executive officer said, "Although we are pleased with our progress in the third quarter, we have seen a notable decline in comparable store sales trends during the first half of November, versus October results, in both of our operating divisions. We believe, at a minimum, that the consumer is taking a pause after Halloween and before the start of the holiday shopping season. With this ongoing situation, we will continue to manage our business very conservatively."
During the third quarter, the company opened 6 Wet Seal stores and closed one, and closed 1 Arden B store. At October 31, the company operated 500 stores which includes 420 Wet Seal stores and 80 Arden B stores. At the end of the same period last year, the company had 500 stores in operation, same compared with the end of the recent third quarter.

Gross margin for the third quarter came down to $41.03 million from $45.91 million for the year earlier period. Selling, general and administrative expenses dropped to $36.00 million from $38.33 million a year-ago.

For the nine-month period, net income plunged to $12.65 million or $0.12 per share from $25.86 million $0.26 per share for the same period last year and net sales came down to $409.92 million from $438.09 million last year.

Looking forward for the fourth quarter, the company expects earnings per share in the range of $0.03 to $0.07 and net sales in the range of $149 million to $155 million. Analysts currently expect the company to earn $0.08 per share on revenues of $156.02 million for the fourth quarter.

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