Most Recent Articles In Fashion Features
Latest Fashion Features Articles
Amid declines in its men’s and women’s wholesale divisions and its retail operation, the firm on Thursday posted a net loss of $113.8 million, or $1.26 a diluted share, for the fourth quarter ended March 31. That’s against net income of $40.7 million, or 45 cents, in the year-ago period. The loss in the most recent year resulted from a noncash charge of $150.6 million for goodwill impairment relating mostly to the firm’s U.S. wholesale component offset in part by a $9.3 million pre-tax reversal of a previous charge for specialty store closure expenses which came in below expectations.
Excluding the one-time items, the company’s income was $28.3 million, or 31 cents, 30.4 percent below last year’s level but at the high end of the company’s May forecast.
Revenues in the three months were essentially flat, dipping 0.4 percent to $498 million from $499.8 million last year. Wholesale sales declined by 0.6 percent to $406.5 million from $409.1 million. While the children’s business rose 12 percent to $91 million, the men’s and women’s businesses fell by 4 percent to $157 million and by 3.5 percent to $158.4 million, respectively.
Joel Horowitz, chairman and chief executive officer, said during a conference call, “The overall misses’ category has softened compared with a year ago as women continue to be conservative with their apparel spending, and accelerating markdown rates and highly promotional pricing are now the rule.”
Horowitz, who will remain as chairman but leave the ceo post when his contract is up next year, said during the conference call that the firm has interviewed some strong candidates to succeed him as ceo, but that strategic initiatives announced last month, including possible acquisitions, “will not take a back seat to the appointment of a new ceo.”
The ceo didn’t discuss what brands his firm was considering, but several sources suggested that the search for acquisitions and the search for a ceo might come together if Hilfiger were to acquire Sweetface Fashion Co., the New York-based firm that produces the JLo by Jennifer Lopez apparel line. Several financial sources said that Hilfiger is exploring Sweetface, a joint venture between Lopez and Andy Hilfiger, younger brother of Tommy. Furthermore, its president and ceo, Denise Seegal, is known to have been among the ceo prospects considered at Tommy Hilfiger.