G-III Apparel Group has taken several significant actions in response to the coronavirus outbreak to strengthen its financial flexibility.
Effective March 30, management voluntarily agreed to temporary reductions in annual salaries. Morris Goldfarb, chairman of the board and chief executive officer, and Sammy Aaron, vice chairman of the board and president, agreed to receive no salary. Wayne S. Miller, chief operating officer and secretary; Neal S. Nackman, chief financial officer, and Jeffrey Goldfarb, executive vice president and a member of the board, each agreed to a 40 percent reduction in their annual salaries. Also effective March 30, the base annual salaries of other senior personnel will be temporarily reduced by 10 percent to 40 percent, depending upon salary levels.
In addition, the company’s wholesale business requires a smaller workforce to execute on the activities of its business. Consequently, the company will be furloughing about 60 percent of its wholesale operations segment employees, effective April 6. All wholesale business furloughed employees will continue to receive existing health-care benefits with the company paying the employees’ share of health-care costs.
In its retail business, G-III has provided ongoing pay and benefits to store employees impacted by the temporary store closures. Given the stay-at-home orders by government officials across the U.S.,the company will also be decreasing the number of its retail employees by more than 80 percent through furloughs and staff reductions, effective April 6. All full-time retail furloughed employees will continue to receive health-care benefits with the company paying the employees’ share of health-care costs.
“Over the years, we have successfully managed through many challenges,” Goldfarb said. “What we are navigating through today is unprecedented and rapidly evolving. I am confident in the actions we are taking to strengthen our financial flexibility to position us for future success. The furlough of many of our employees was one of the most difficult decisions we have had to make as an organization, and the one we did not take lightly. We look forward to bringing our furloughed employees back to work as soon as possible.”
G-III, a $3.2 billion company, designs, sources and markets apparel and accessories under owned, licensed and private label brands. Its owned bands include DKNY, Donna Karan, Vilebrequin, G.H. Bass, Andrew Marc, Marc New York, Eliza J and Jessica Howard. Its fashion licenses include Calvin Klein, Tommy Hilfiger, Karl Lagerfeld Paris, Kenneth Cole, Cole Haan, Guess, Vince Camuto, Levi’s and Dockers brands. The company also has a sports business with licenses with the National Football League, National Basketball Association, Major League Baseball, National Hockey League and more than 150 U.S. colleges and universities. Its retail stores are under the DKNY, Wilsons Leather, G.H. Bass, Vilebrequin, Karl Lagerfeld Paris and Calvin Klein Performance names.
The company’s stock closed Tuesday at $7.70, up 6.21 percent.
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