Right Start Expecting Major Loss for Quarter

The Right Start Inc., a Westlake Village mail-order merchandiser and retailer of baby products, said it expects to report a “significant loss” for its fiscal third quarter ended March 2 because of operating losses for its catalog and severance costs related to the resignation of its former chief executive.

The firm said it expects to continue losing money through its fiscal year ended June 1, and possibly into fiscal 1997.

The losses could damage its working capital and credit status with suppliers, the company said.

The company also said it has set March 8 as the record date for its proposed rights offering.

Right Start stockholders will be entitled to receive one right for each share held on the record date. Each right will entitle the owner to buy 0.25 shares of common stock at the rate of $3.17 per share.

The company estimated its proceeds from the rights offering at about $5 million if all the shares are purchased.

It said it will use the funds for retail expansion and for general corporate purposes.