In Liz Claiborne Inc.’s “A Tale of Two Cities” model, neither city is immune from the macroeconomic malaise, driving the company to a third-quarter loss of $68.7 million.
For the three months ended Oct. 4, Claiborne suffered a loss of 73 cents a diluted share, down from a gain of 33 cents, or $33.1 million, in the third quarter of last year. The loss from continuing operations was 10 cents a share, in line with guidance the company released on Oct. 24.
Sales slid 16 percent to $1.01 billion from $1.21 billion, driven down by decreases in the partnered brands segment as well as in Mexx on the direct brand side.
Ending a winning streak led by consistent sales gains of about 50 percent from Juicy Couture, the direct brands segment experienced a 2 percent sales decrease to $617 million, dragged down by Mexx. Excluding the impact of licensing the Juicy and Lucky fragrance operations in the second quarter of this year, sales increased 2 percent, according to the company.
The biggest of the direct brands, Mexx, saw sales fall 15 percent to $311 million, excluding the impact of foreign exchange rates. Juicy’s sales slowed to a more modest 7 percent gain to $144 million. Lucky had sales increases of 2 percent to $111 million. The smallest direct brand, Kate Spade, saw 47 percent sales growth to $29 million.
Sales of the partnered brands — which were suffering even before the economy turned — declined 31 percent to $398 million. Of the $180 million decline, $159 million is from brands that have been licensed or closed since last year.
The company also presented adjusted earnings per share from continuing operations that represented a gain of 39 cents, compared with a gain of 60 cents last year.
“Third-quarter adjusted EPS from continuing operations were 39 cents in this significantly challenging macroeconomic environment, primarily driven by better-than-forecasted expense controls, which offset a top line which was below our expectations,” said chief executive officer William L. McComb. “We will continue our intense focus on controlling the controllables…inventory, accounts receivable, astute brand execution and generating free cash flow to pay down debt. In terms of product and brand execution, we’ve spent the past year developing outstanding product for this spring — and although the environment will temper our results, we are as optimistic as we can be about how our brands will present at retail.”
For the first nine months of the year, Claiborne has posted a loss of $122.9 million, or a loss of $1.31 a share, down from a gain of $62.9 million, or 62 cents, last year. Sales declined 6 percent to $3.07 billion from $3.27 billion.
On an adjusted basis, for the first nine months, Claiborne posted an earnings gain for continuing operations of 83 cents, compared with adjusted gains of 94 cents for the first nine months of 2007.
Claiborne tightened its adjusted EPS guidance for the year to a range of $1.02 to $1.07, after narrowing it last month to $1 to $1.10 a share from a previous guidance of $1.40 to $1.60.
@tradesy is turning the concept of a showroom upside down with its new space in Santa Monica. Here, the company plans to hold events, art exhibits and a showcase rare fashion pieces like this Louis Vuitton boxing set. Get all the details on Tradesy’s first showroom on WWD.com. #wwdnews
Spotted last night at the @erdem x @hm launch event: Kate Bosworth, Rashida Jones, Kirsten Dunst and Selma Blair. The party, which took place in LA, also marked the opening of their pop-up shop. “I was interested in creating a collection that wasn’t in any way disposable. It was about pieces you’d create and keep forever, things that have a permanence to it,” designer Erdem Moralioglu said. #wwdeye (📷: Katie Jones)
Renee Zellweger in yellow in 2001 and again in 2017. Chosen as one of the 12 @pantone Leading Spring Colors (and dubbed “Meadowlark”), it only makes sense that the bright hue stands the test of time and is making a resurgence this season, seen already on stars like @blakelively and @gigihadid. (📷: Donato Sardello & @rexfeatures) #wwdfashion #tbt
Dior’s 70th anniversary celebration continues with a new exhibition at the Royal Ontario Museum in Toronto. “Christian Dior,” which is scheduled to run through March 18, takes a look at the founders tenure from 1947 to 1057 and feature 40 designs. Pictured here is an evening gown from the Ailée, fall 1948-49 haute couture collection. #wwdfashion (📷: Brian Boyle)
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews