A new round of cost-cutting measures at G-III Apparel Group Ltd. will affect employees from the bottom of the payroll on up.
This story first appeared in the February 4, 2009 issue of WWD. Subscribe Today.
The New York-based outerwear and sportswear marketer said Tuesday it will at least temporarily end its 401(k) matching program and, for the next six months, trim the salaries of top executives in response to what it called “economic uncertainties” in the upcoming year.
In documents filed with the Securities and Exchange Commission, the company said it reduced the base salary of Morris Goldfarb, chairman and chief executive officer, by 20 percent to $800,000 a year from $1 million. Sammy Aaron, vice chairman and president of the company’s Marvin Richards division, also saw his base salary trimmed 20 percent, to $600,000 from $750,000, and the same reduction was applied to the pay of Wayne Miller, G-III chief operating officer and secretary, and Jeanette Nostra, president, both of whom had their salaries reduced to $400,000 from $500,000. The firm cut the compensation of chief financial officer and treasurer Neal Nackman by 10 percent to $292,500 from $325,000.
The company said it reduced the base salaries of two other unnamed division heads by 20 percent and cut cash compensation for nonemployee directors by 20 percent as well.
All pay reductions are effective for the six months started Feb. 1, G-III said.
The company eliminated its 401(k) match plan for the fiscal year ended Jan. 31, according to the filing.
G-III has yet to set a release date for its year-end and fourth-quarter results. In December, the company cut its fiscal year earnings guidance to between 95 cents and $1.05 a diluted share on net income of between $16.3 million and $18.1 million. Previously it had expected diluted EPS of $1.35 to $1.40 on income between $23.5 million and $24.4 million.
The firm, which holds licenses for Calvin Klein, Cole Haan, Sean John and Kenneth Cole, among others, acquired Wilsons The Leather Experts stores last year.
Shares of the company fell 35 cents, or 6.5 percent, in trading Tuesday to close at $5.05.