NEW YORK — William L. McComb and Liz Claiborne Inc. have seen a tumultuous 12 months since the company's last annual meeting, and the one the chief executive officer directed Wednesday crystallized the turmoil.
For one thing, Claiborne's shares, now trading at about $18, are almost half what they were a year ago. Secondly, the $4.58 billion firm has eliminated more than 1,300 jobs, including approximately 25 percent of its management positions, according to McComb. He added, "The last significant area of focus is manufacturing and sourcing, and you will be hearing big news related to this function within the next month or so."
But McComb defended the company's strategic plan, including substantial restructuring, and pointed out that "right now the economy is not being kind to companies in the apparel industry" — the twofold theme of his second shareholder meeting as ceo.
"After reporting a significant financial miss in the first quarter and indeed a dismal view of the year as a whole, we turned inward to look self-critically at what needed to change — not just to address our short-term outlook, but to once again lead the industry in terms of financial performance and overall reputation," McComb told the several dozen Claiborne employees, board members and shareholders. "During these increasingly difficult economic times, we focused on implementing the changes needed to prepare the business to lead once the inevitable rebound in the economy is realized, with enviable sales and earnings growth and newfound brand strength."
Thursday's shareholder meeting was the first since Claiborne's July 11 investor meeting last year, when McComb unveiled sweeping changes including placing 16 under-performing brands on strategic review and investing heavily in the company's higher growth potential brands like Juicy Couture and Lucky Brand.
At the meeting, shareholders voted to extend the tenure of four board members until 2011: McComb, chair Kay Koplovitz, Oliver Sockwell and Kenneth Gilman, who was elected in February to replace Paul Tierney and whose initial term expired Thursday.
Eighty-two percent of shareholders voted for a proposal to urge the board to change its requirement from a 75 percent plurality to a simple majority. Before the vote was taken, McComb said the board "continues to believe that stockholder approval should be greater than a bare majority, particularly in absence of board approval," but said that after the vote, the board would "take the proposal under advisement."
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