American Apparel Inc.’s battle with its suspended chief executive officer, Dov Charney, took a bite out of the company’s bottom line in the second quarter.
In the final tally, American Apparel recorded net losses of $16.2 million, or 9 cents a share, for the quarter ended June 30, down from losses of $37.5 million, or 34 cents, a year earlier.
Part of that deficit stemmed from $1.3 million in professional fees American Apparel paid as it ousted Charney, who is now back as a consultant pending the results of an investigation into his conduct while leading the company.
The professional fees added to operating expense for the quarter, which overall shrank 7 percent to $79.8 million, with a $4 million cut to payrolls and associated costs and a $2 million cut to advertising and marketing.
American Apparel also said net sales remained roughly flat at $162.4 million for the quarter, with a 6 percent drop in comparable-store sales at its own doors and a 9 percent increase in wholesales sales.
The company gave preliminary results last week that estimated net losses at $15 million.
The firm has reconstituted its board, which is considering the fate of Charney, who handed over most of the voting rights tied to his stake in American Apparel to Standard General.
Alberta Ferretti's "Rainbow Week" sweaters are back. The designer closed her #MFW show with a few day-of-the-week sweaters, which first debuted on the catwalk last January as part of the pre-fall 2017 collection. #wwdfashion (📷: @delphineachard)