Talbots sees loss on weak sales, consumer spending

NEW YORK (Reuters) - Women's apparel retailer Talbots Inc (TLB.N) on Wednesday forecast a loss for its fiscal third and fourth quarters, citing weaker-than-expected sales and tight consumer spending.

Talbots said it now expects that same-store sales will fall in mid- to high-single-digits in the six-month period that ends February 2, 2008. Total company sales would fall by about $65 million to $75 million from its previous plan, Talbots said.

The company, which posted a wider quarterly loss in August on weak response to its casual clothing, said sales in the current quarter has been lackluster, particularly in its Talbots brand.

For the quarter, the company expects a loss of 20 cents to 25 cents a share, including one-time expenses.

It forecast a fourth-quarter loss of 5 cents to 10 cents a shares, including a similar one-time charge for executive compensation and consulting fees.

"...We remain very cautious in our fourth quarter outlook, given the continued uncertainty of the economic environment and our difficult earlier trends," Chief Executive Trudy Sullivan said in a statement.

For the six months ending February 2 2008, Talbots said it expected a loss of 25 cents a share to 35 cents a share. Earlier, it had forecast per-share earnings of 42 cents a share to 48 cents a share. Both forecasts include one-time items.

The company, which has suffered fashion missteps and weak sales for some time, has already announced a strategic review of its business in a bid to drive profit growth.

(Reporting by Aarthi Sivaraman; additional reporting by Dilipp S. Nag in Bangalore)