Maternity apparel retailer Mothers Work Inc. reported Tuesday that it quadrupled its profits for the third quarter, but forecast a fourth-quarter loss aggravated by restructuring costs and a new $7 million stock repurchasing plan.
Effective through July 2010, the repurchase program will give the company “excellent flexibility” at a time when it is also trying to reduce its debt, according to chief operating officer Edward M. Krell. In June, the company prepaid $8 million of its senior secured term loan, bringing to $13 million the amount prepaid since March.
For the three months ended July 29, the Philadelphia-based retailer posted net income of $4.1 million, or 68 cents a diluted share, versus year-ago profits of $1 million, or 17 cents. Sales declined 0.7 percent to $152.2 million from $153.2 million. After a 0.8 percent increase in June, same-store sales increased 2.4 percent. The company cited lower sales in Sears’ leased departments and the closure of underperforming stores as among the reasons for the decline in net sales.
Eliminating debt repurchase charges of 1 cent in the most recent quarter and 69 cents in the 2007 period, earnings per share declined to 69 cents from 90 cents. The company had projected EPS of between 66 and 70 cents for the most recent quarter.
“We are pleased with our strong sales performance for June and for the third quarter, despite the continued weak overall economic and retail environment, as we continue to anniversary weaker sales results from a year ago and define our merchandise assortments and our in-store merchandise presentation,” president and chief creative officer Rebecca Matthias said.
For the nine months, net income dropped 31.9 percent to $3.4 million, or 56 cents a diluted share, from $5 million, or 81 cents, in last year’s period. Excluding special charges for debt extinguishment, EPS dropped to 57 cents from $1.74. Sales dropped 2.6 percent to $434.1 million from $445.6 million. Same-store sales decreased 0.6 percent.
The company projected a net loss in the range of 30 to 46 cents a share for its fourth quarter, translating to a loss of 23 to 39 cents before debt repurchase and restructuring charges. The firm lost 92 cents a share in the fourth quarter of 2007. Net sales are expected to come in at between $130.5 million and $134.4 million.
Gross margin for fiscal 2008 is projected at approximately 50.3 percent of net sales, a decrease from the company’s 51.6 percent gross margin in fiscal 2007.
At the end of the quarter, the company operated 761 stores and 294 leased departments, down from 787 stores and 812 leased departments in the prior year. The company earlier this month decided to eliminate its Mimi Maternity store brand in favor of its Pea in the Pod and Destination Maternity nameplates.
In yet another fashion show shuffle, @elleryland is moving its show in sync with the Paris couture calendar — though the brand is still keeping one foot on the city’s ready-to-wear schedule. Their runway show in January will coincide with the launch of a new strategy: designing two main collections each year instead of four, which will then be released in four drops. “As we all know, the system needs to change. We need to show sooner to give time back to artisans and designers to do what they do best — create,” said founder Kym Ellery. #wwdnews #wwdfashion (📷: @kukukuba)
@maxmara’s classic 101801 coat was the cornerstone of its pre-fall 2018 collection. The design team expanded the traditional double-breasted, kimono-sleeved style into a trapeze coat, lean belted styles and a peacoat and presented them in monochromatic looks – like the camel one pictured here. #wwdfashion #prefall18 (📷: George Chinsee)
The @cfda has shifted the dates of #NYFW, with Men’s showing on February 5 through February 7, and Women’s will directly follow, running from February 8 through 14. The preliminary schedule will be released on the CFDA’s web site in the next few days, but Mark Beckham, VP of marketing for the CFDA, revealed that @rafsimons will be back to close the men’s-specific part of the week with a show on February 7 #wwdfashion (📷: Kelly Taub)
@ferragamo is introducing a new space dedicated to the development of women’s and men’s leather good samples. The laboratory, which is created eco-friendly materials and designed to reduce the environmental impact of the manufacturing processes, will allow the company to expand its accessories offering through traditional artisanal approaches. #wwdfashion (📷: @aitorrosasphoto)
How does a “regular, degular, schmegular” girl from the Bronx, N.Y., become a Grammy-nominated artist with a certified platinum record in less than a year? Call it the @iamcardib come up. The 25-year-old has become a musical sensation, and the fashion world is taking note. “If I could describe her style I would say drama. She’s really into the dramatics,” says Cardi B’s stylist @kollincarter. See how Carter styles her bold and out there looks with the link in bio. #wwdfashion
“There is no formula. There is no guideline. I can watch Ted Talks all day, but there is no one who can advise me on exactly what it is I should be doing,” said @ronniefieg, CEO of @kith, in an interview with WWD’s @ariahughes at the brand’s new SoHo office in Manhattan. Head to WWD.com to see how Fieg went from hanging out in shoe stockrooms at 13 to building his own business. #wwdfashion (📷: @weston.wells)
@fearofgod and @maxfieldla have teamed up on a pop-up installation. The store, located in the gallery space across from Maxfield’s Melrose Ave location, is the site of the brand’s House of God pop-up in which Fear of God founder @jerrylorenzo has created a church-inspired installation. A dozen vintage church pews sit in front of an LED screen playing 90s gospel singers in an effort to re-create an environment akin to a Southern Baptist Church, Lorenzo explained. Read more about the pop-up on WWD.com #wwdfashion (📷: Jennifer Johnson)
Known for his sleek, sophisticated American glamour, Norman Norell is the subject of an upcoming exhibition at @fitnyc. “Norell: Dean of American Fashion,” which runs from February 9 through April 14, will feature approximately 100 ensembles and accessories. His best work is exemplified by the designer’s glittering “mermaid” gowns frosted with thousands of hand-sewn sequins – like the one pictured. (📷: William Helburn) #wwdfashion
For pre-fall 2018, @balmain didn’t let go of the glitz. A crystal embroidered baseball jacket priced at around $40,000 hangs in the “couture” section of the brand’s first men’s pre-collection. Sporting the words “Balmain Army” across the back, the item took around two months to make. “When it was completed, it was like Christmas, it was like, ‘It’s done, it’s exactly what I wanted,’” said Balmain’s creative director @olivier_rousteing during a tour of the collection in a Paris showroom on Monday. #wwdfashion