By  on October 1, 2007

Rafaella Apparel Group Inc. said its net earnings fell by half for both the fourth quarter and fiscal year.

The women's sportswear firm, which was bought by Cerberus Capital Management two years ago through issuing $172 million in public debt, reported its fourth quarter and annual results Friday. As of June 30, the firm has more than $160 million in total liabilities.

For the three months ended June 30, net earnings dropped to $268,000 from $543,000 for the same period last year. Sales increased 11 percent to $46.1 million from $41.6 million.

For the year, net earnings sank to $6.3 million from $12.6 million. Sales declined 14 percent to $191.3 million from $222.2 million.

Operating earnings also fell sharply for both the quarter and the year. In a filing with the Securities and Exchange Commission, the company cited factors ranging from consumers rejecting the product to increased competition and consolidation. A spokesman declined further comment. A conference call will be held Tuesday.

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