Steve Madden has reported relatively flat sales of $295.7 million for the second quarter ended June 30. Due to higher promotional activity, the gross margin declined to 36.2 percent from 37.2 percent a year ago, and the operating margin fell to 13.6 percent from 15.3 percent. Net income dropped to $28.0 million from $29.0 million. Same-store sales were off by 8.5 percent, but they were partly compensated for by the opening of 11 new stores a year ago. Besides a drop in sales of private label footwear to a specific customer, Madden complained about the absence of new fashion drivers and weak traffic in its stores, but mentioned solid gains in its international business. The management's outlook for the full year is not as good as before, with revenues expected to rise by only 2 to 4 percent, mainly because of pressure in wholesale accessories.