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April 23 (Reuters) - Women's retailer Charlotte Russe Holding Inc CHIC.O reported an almost 11 percent rise in its second-quarter profit, driven by higher sales and a favorable tax expense adjustment.
The company posted a net income of $4.2 million, or 17 cents a share, compared with $3.8 million, or 15 cents a share, a year earlier.
Net sales increased 15 percent to $185.1 million.
Analysts on average expected the mall-based specialty retailer to earn 16 cents a share, before special items, on revenue of $186.7 million, according to Reuters Estimates.
The company, which sells apparel and accessories targeting young women in their teens and twenties under the Charlotte Russe, Refuge and blu Chic brands, said its results included a favorable tax expense adjustment of about 3 cents a share.
Charlotte Russe still expects third-quarter same-store sales to remain flat or fall by a low single digit.
However, the company, which competes with fashion retailers such as Abercrombie & Fitch Co (ANF.N) and Hot Topic Inc HOTT.O, added that it continued to remain cautious in the current retail environment.
Charlotte Russe, based in San Diego, said it expected its share repurchase program to benefit third-quarter earnings by about 4 cents a share.
It had repurchased about 4.1 million shares, or 16.3 percent of its outstanding shares as on April 2, in a modified Dutch Auction tender offer.
Accordingly, it now expects third-quarter earnings of 31 cents to 34 cents a share, up from its prior view of 27 cents to 30 cents a share. Analysts were expecting a profit of 30 cents a share, before special items.
The company, which operated 448 stores as on March 29, said it planned to open about 60 stores in fiscal 2008. (Reporting by Dilipp S. Nag in Bangalore; Editing by Himani Sarkar)