Shares of Jones Apparel Group on Wednesday rose 6.29 percent after the company posted third-quarter results that bested Wall Street's expectations by 17 cents.
Jones Apparel shares closed at $20.94 in trading on the New York Stock Exchange, with nearly five million shares changing hands compared with a three-month average volume of nearly two million.
As reported, profits for the $4.74 billion apparel giant for the three months ended Oct. 6 rose to $400 million, or $3.97 a diluted share, from $63 million, or 56 cents, in the same year-ago quarter. The gain came primarily from the sale of Barneys New York in September to Dubai investment firm Istithmar for $942.3 million. Excluding the sale of Barneys and other charges, adjusted earnings per share from continuing operations were 51 cents compared with 59 cents a year ago. The consensus estimate among Wall Street analysts was 34 cents, according to First Call.
Revenues for the quarter slid to $1.03 billion from $1.08 billion.
The company kept its full-year 2007 per-share profit range for continuing operations at between $1.20 and $1.25.
President and chief executive officer Wes R. Card said in a call to Wall Street analysts that declining sales to department store customers were stabilizing.
He also disclosed that, for the first time, in 2008, the entire management team will be "unified and share similar incentives toward achieving positive results."
He said the company has outlined and is rolling out an incentive compensation plan for the "top 90 executives in the company tied to both divisional and corporate performance metrics, which replaces the existing discretionary bonus plan. These goals include the achievement of planned operating income and operating cash flow targets and, for the longer-term, a component of total shareholder return versus our peers in operating cash generation."
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