June 3, 2009 / 3:24 PM / 8 years ago

UPDATE 1-Economic downturn squeezes Reitmans profit

* EPS C$0.11 vs C$0.26

* Sales rise 1.5 pct to C$231.7 mln

* Same store sales drop 0.8 pct

* Shares down 3.6 pct at C$11.76

TORONTO, June 3 (Reuters) - Reitmans (Canada) Ltd (RET.TO) reported a 58 percent drop in first-quarter profit on Wednesday as consumers cut back spending in the economic downturn.

The Montreal-based women’s clothing retailer, whose banners include Reitmans, Smart Set and Penningtons, said it earned C$7.8 million, or 11 Canadian cents a share, in the quarter ended May 2, down from C$18.4 million, or 26 Canadian cents a share, a year earlier.

Overall sales rose 1.5 percent to C$231.7 million. However same store sales -- the performance of stores open for at least a year -- slid 0.8 percent.

Reitmans blamed the softer same store sales on the weak economy as consumers cut back on discretionary spending.

$1=$1.10 Canadian Reporting by Scott Anderson; editing by Rob Wilson

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