Special charges threw the Warnaco Group Inc. to a fourth-quarter loss, but cost-cutting efforts and the continuing strength of its Calvin Klein licenses helped lift results above analysts’ expectations.
Net losses for the three months ended Jan. 3 were $16.3 million, or 36 cents a diluted share, compared with net income of $22.9 million, or 49 cents, in the year-ago quarter. Eliminating restructuring expenses, discontinued operations and other items, earnings per share was 21 cents, above the consensus estimate of 15 cents.
Revenues dipped 4 percent, to $445.9 million from $466.5 million, but rose 4 percent on a constant-currency basis. Gross margin improved 250 basis points to 42.2 percent of sales.
“The power of our diversified business model and the disciplined execution by our team enabled us to advance our long-term strategic goals and continue to position the company for further success,” said president and chief executive officer Joseph Gromek on an earnings call Thursday morning.
For the fiscal year, earnings fell 40.3 percent to $47.3 million, or $1.01 a diluted share, from $79.1 million, or $1.70, in 2007. Revenues for the year grew 13.5 percent to $2.07 billion from $1.82 billion. Calvin Klein brand revenues increased 21 percent to $1.5 billion for the year, representing almost three quarters of the company’s total sales. Calvin Klein Jeans revenues were up 24 percent; Calvin Klein Underwear revenues rose 16 percent, and Calvin Klein accessories revenues within the jeans segment increased 63 percent.
International revenues rose 26 percent, making up more than half of the total, with Latin-American sales up 59 percent, Asia 29 percent and Europe 23 percent.
Retail sales increased 28 percent for the year, with same-store sales ahead 12 percent in the quarter and 13 percent for the full year.
“The U.S. is probably 10 to 15 points behind what’s going on internationally,” Gromek said. “Remember all of our retail expansion is happening outside of the United States.”
The company provided guidance for 2009, anticipating revenues will decline 2 to 5 percent on a constant-currency basis, with expected earnings per share from continuing operations in the range of $2.40 to $2.66.
Shares of Warnaco ended Thursday’s trading session at $20.59, up 57 cents or 2.9 percent.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast