DISAPPOINTING PROFIT FORECAST SENDS TIMBERLAND STOCK DOWN

NEW YORK--Shares of Timberland tumbled 3 5/8, or 14 percent, Tuesday to 22 1/2 in the wake of the company's announcement Monday--issued after the market closed--that operating results for the first and second quarters will be "significantly below Wall Street analysts' expectations." Timberland said it expects a sales gain of more than 30 percent but had planned its expense level based on an even higher level of sales growth and on better gross margins.
Dana Telsey, analyst at Bear Stearns & Co, said she expected a loss of 5 to 7 cents a share for the first quarter and a profit of $2 to $2.10 for the year, with growth in the second half. Last year, Timberland earned $1.58.
In the year-ago quarter, Timberland lost $1.6 million, or 14 cents, on sales of $108.1 million. "The retail environment has been difficult," Telsey said, citing unseasonable weather and a late Easter. "Timberland's high inventory could also be a problem."
In December 1994, the firm told analysts that warm weather hurt sales and fourth-quarter profits would fall below year-ago levels. In the quarter, earnings fell to $2.9 million, or 26 cents, from $7 million, or 62 cents, despite a 46.4 percent sales gain to $180.4 million. The stock traded as high as 61 in 1994.

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