Sport-Haley, Inc. reported that net sales for the fiscal first quarter decreased 24.5% to $3.5 million from $4.7 million in the year-ago quarter. Net sales of fashion apparel for the quarter were $3.4 million, a decrease of $80,000, or 2%, from net fashion apparel sales of $3.45 million for the comparable period in the prior fiscal year. The decrease in sales of fashion apparel was primarily comprised of an increase in sales of SPORT HALEY women's apparel combined with a decrease in sales of Ben Hogan men's apparel between the respective periods. Net sales of Top-Flite branded apparel for the quarter were $120,000, a decrease of $1.1 million, or 90%, from branded apparel sales of $1.2 million for the comparable period in the prior fiscal year. Net sales of branded apparel for the three months ended September 30, 2007, were comprised of initial shipments to a retailer for a test of Top-Flite apparel in 50 of its stores. Net sales of branded apparel for the three months ended September 30, 2006, were comprised of sales to Wal-Mart of $1,000,000 and sales of $185,000 to other markets.

As a percentage of net sales, gross profit of our fashion apparel was 34% and 34% for the three months ended September 30, 2007 and 2006, respectively. As a percentage of net sales, gross profit of our branded apparel was 21% and 25% for the three months ended September 30, 2007 and 2006, respectively.

Net loss for the three months ended September 30, 2007, was $627,000, a difference of $230,000, or 58%, as compared with the net loss of $397,000 for the comparable three-month period in the prior fiscal year. Both the basic and diluted losses per share were 27 cents for the three months ended September 30, 2007, and were 14 cents per share for the comparative three-month period in the prior fiscal year. All securities options were anti-dilutive and therefore excluded from the per share calculations with respect to periods in which net losses were incurred.