NEW YORK — Perry Ellis International reported an expected net decline for the second quarter driven by retail consolidation and a reduction in off-price sales.
The company announced a slightly wider net loss for the second quarter ended July 31, down to $2.5 million, from $2.4 million for the same period last year. The diluted loss per share stayed at 25 cents.
Its sales declined 10.1 percent for the second quarter, dropping from $184.3 million to $165.7 million.
Earnings for the six-month period declined 46.2 percent to $3.5 million, or 34 cents a diluted share, from $6.5 million, or 65 cents a diluted share, for the same period last year. Sales for the half were down 7.6 percent to $374 million from $404.7 million.
According to company statements, the earnings decline was expected. The company pointed to reductions of private label and branded programs at one midtier chain, the impact of the merger of Federated Department Stores and May Co. and a reduction in off-price sales as drivers of the losses in the quarter and in the first half.
"We continue to perform on plan despite the impact of retailer consolidation. We are pleased with the significant improvement of our gross profit margins, which is a result of great products performing exceptionally well at retail, as well as improved production planning and sourcing," said chairman and chief executive officer George Feldenkreis, in a statement. "We also continue to effectively manage our working capital, by significantly reducing inventory levels and improving inventory turns. Lastly, we continue to improve processes to lower our expense levels, which resulted in lower first-half operating expenses versus last year."
The company said things are on target to improve and grow during the fourth quarter, driven by expected growth in swim, outerwear, the Perry Ellis sportswear line and international and direct retail, said Oscar Feldenkreis, vice-chairman, president and chief operating officer of the company.
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