Teen retailer swings to profit

Teen retailer Wet Seal Inc. said it returned to profitability in its fiscal third quarter because of lower charges and the lack of expenses related to a change in the company’s leadership that weighed down results a year earlier.

It also offered fourth-quarter profit guidance lower than Wall Street analysts’ estimates.

For the quarter ended Nov. 1, the Foothill Ranch company reported net income of $6.8 million, or 7 cents a share, compared with a loss of $3.3 million, or 4 cents, a year earlier.

The results matched the expectations of Wall Street analysts polled by Thomson Reuters.

Revenue declined 2% to $146.6 million; analysts had predicted $145.7 million.

Sales rose at Wet Seal stores but fell slightly at the company’s Arden B chain.

Wet Seal said it expected profit of 6 to 10 cents a share for the fourth quarter and sales of $155.4 million to $160.8 million. Analysts expect profit of 13 cents a share on revenue of $170.7 million.