By  on March 4, 2009

After posting a fourth-quarter loss of $828.9 million, mainly due to a goodwill writedown, Liz Claiborne Inc. is expecting further “meaningful” losses in the first half of 2009 and is eyeing additional cost cuts.


Declining to provide 2009 earnings guidance due to “the highly uncertain environment,” Claiborne chief executive officer William L. McComb warned on an earnings call Wednesday that he anticipates no immediate improvement for retail sales in 2009 from the dismal final quarter of 2008.

Claiborne’s shares fell 11.4 percent to close at $2.50 Wednesday on the New York Stock Exchange. The company said it took a $693 million impairment charge in the fourth quarter — representing the bulk of its loss — because market capitalization declined below book value as the company’s shares declined.

For the three months ended Jan. 3, the company nearly doubled its loss to $8.85 a diluted share, compared with a loss of $4.55 a share, or $435.7 million, in the fourth quarter last year.

Sales in the quarter fell 22 percent to $911.2 million from $1.17 billion, hurt by steep losses in the partnered brands division as well as in Mexx, which the company broke into a third category — “international-based direct brands” — for the first time to separate the troubled Amsterdam-based retailer from the better performing direct brands Juicy Couture, Lucky Brand and Kate Spade.

Excluding streamlining expenses, goodwill impairment charges and brands that have been licensed or exited, the adjusted loss from continuing operations was 4 cents a share, beating the loss of 5 cents a share expected by analysts polled by Yahoo Finance. In January, the company attempted to manage expectations, saying its quarterly loss could run as high as 15 cents a share.

For fiscal year 2008, Claiborne saw a loss of $951.8 million, or $10.17 a diluted share, compared with a 2007 loss of $372.8 million, or $3.74. Annual revenues fell 10 percent to $3.98 billion from $4.44 billion.

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