SAN DIEGO — Citing higher cotton prices, Beeba’s Creations continued in the red in the second quarter and said it expects to report a loss in its fiscal year ending Aug. 31.
The deficit also reflects losses from its 50.8 percent ownership stake in lingerie manufacturer Body Drama.
Beeba’s, a women’s sportswear manufacturer, also suspended its quarterly dividend of 8 cents a share.
In the quarter ended Feb. 28, Beeba’s lost $1.3 million against earnings of $286,000, or 11 cents a share, a year earlier. Sales in the latest quarter increased 16.1 percent, to $29 million from $25 million.
Body Drama recorded a loss of $741,239 in the latest quarter against a $425,221 loss a year earlier. Sales at Body Drama climbed 30.6 percent, to $7.2 million from $5.5 million.
In the six months, Beeba’s reported a loss of $2 million against a profit of $822,353, or 30 cents a share, a year earlier. Sales climbed 18.4 percent, to $59.7 million from $50.4 million.
Body Drama’s loss in the half increased to $970,492 from $248,468, while sales rose 38 percent, to $17.2 million from $12.5 million.
Steven P. Wyandt, chief executive officer of Beeba and of Body Drama, said he anticipates a significant increase in material costs over the next six months, noting that cotton prices increased up to 30 percent the last three months.
He said earnings in the second half would be flat against year-ago profits of $502,000, or 19 cents a share.
Body Drama is also expected to post a loss in the second half, though it should be lower than the $399,000 loss logged in 1993’s second half, said Wyandt.
Beeba’s said it will continue to concentrate on reducing its operating expenses.
Body Drama is still reviewing financial alternatives under a special independent committee, including the possible sale of the company or the reacquisition by Beeba’s of the shares of Body Drama it does not own.