AnnTaylor Stores Corp reported higher-than-expected quarterly earnings on Friday, as the retailer's lower inventory levels helped its gross margins.

The operator of the Ann Taylor and Ann Taylor LOFT chains said net profit was $2.1 million, or 3 cents per share, for the third quarter ended October 31, compared with a net loss of $13.4 million, or 24 cents per share, a year earlier.

Excluding restructuring and asset impairment charges, the company said it earned 20 cents per share.

On that basis analysts on average were expecting earnings of 7 cents per share, according to Thomson Reuters I/B/E/S.

(Reporting by Martinne Geller, editing by Gerald E. McCormick)