CHICAGO — Hurt by a squeeze on gross margins from lowered operating schedules, Fruit of the Loom reported first-quarter earnings dropped 43.1 percent, to $25.1 million, or 33 cents a share, from $44.1 million, or 58 cents before a year-ago special gain.
After the $3.4 million gain from accounting changes, year-ago earnings were $47.5 million, or 62 cents. Sales inched up 2.2 percent to $438.2 million from $428.9 million.
In another development, Fruit of the Loom reported Wednesday that Arnold Ribet is returning to the company as executive vice president of business development, focusing primarily on business strategy, pricing and product development for the company’s screenprint division.
Since 1986, he has been executive vice president of sales and marketing at Oneita Industries. Earlier he held a senior post in sales and marketing for Fruit of the Loom where he worked from 1950 to 1986.
Ribet, who assumes his new duties next month, will be working with both William Farley, chairman and chief executive officer, and Ronald Zabel, president, consumer packaged products.
Discussing the first-quarter results, Farley noted that they reflect reduced plant operating schedules in the first part of the period.
“This negatively impacted gross margins and was the major contributing factor to unfavorable earnings-per-share comparisons,” added Farley.
However, the firm said, it has returned all its manufacturing plants to full operation because of increased demand.
Farley also noted that with the recent acquisition of the Gitano trademark and formation of a new subsidiary, Gitano Fashions Limited, Fruit of the Loom hopes to “move into a more fashion-forward market in the mass channel.”