MONTREAL - Clothing retail chain Le Chateau more than doubled its loss in the third quarter due to a decrease in its gross margin as it saw less traffic and increased promotions in its stores.

The Montreal-based fashion retailer said it had a net loss of $11.1 million, or 37 cents per dilluted share, for the period ended Oct. 25. This compared with a net loss of $5 million, or 18 cents per dilluted share, for the same period a year earlier.

Le Chateau said the loss also included a $1.1 million of write-offs and net impairment, compared to $96,000 a year ago. It added that an unrecognized tax benefit of non-capital losses also accounted for $2.3 million of the net loss.

Sales during the quarter were $58.1 million, down 11 per cent from $65.4 million in the prior year.

Same-store sales for outlets open at least a year decreased 9.7 per cent, while online sales were flat.

Le Chateau operates 224 retail locations in Canada. It also has five stores under licence in the Middle East.