CHAUS EARNINGS QUADRUPLE IN 4TH QUARTER, SOAR FOR YEAR
Byline: Thomas J. Ryan
NEW YORK — Continuing its long ride in turnaround mode, Bernard Chaus Inc. reported profits catapulted more than fourfold in the fourth quarter and soared 152 percent in its fiscal year ended June 30.
The women’s better apparel maker also said it is looking for a president to take charge of sales and marketing and drive its growth.
“Our financials are in order and our product lines are in place. What we really need is the catalyst to grow the company,” Josephine Chaus, chairwoman and chief executive officer, told WWD. The post of president has not been held at Chaus for more than three years.
In the quarter, earnings rose to $2.5 million, or 9 cents a share, up from $546,000, or 2 cents, a year ago. Sales advanced 15.6 percent to $41.4 million from $35.8 million. Excluding sales of the discontinued Nautica line, sales climbed 23.2 percent. The Nautica license was terminated in October 1998.
In the year, earnings gained to $10.8 million, or 40 cents, from $4.3 million, or 28 cents, a year ago. Fiscal 1998 was the first year that the firm showed an annual profit since 1992.
Sales dipped 1.9 percent to $187.9 million from $191.5 million, but were up 10.8 percent excluding the Nautica license.
The chairwoman said the firm continues to benefit from a repositioning of the Chaus brand from a moderate to a better sportswear line, as well as substantial reduction in debt as a result of a recapitalization completed in January 1998.
Chaus said the firm had a good consumer response to the introduction this spring of the Josephine Chaus Essentials, a better sportswear separates line, and Josephine Chaus Studio, a line of business casual attire.
The firm has two other lines — Josephine Chaus Collection and Josephine Chaus Sport — and the spread of the four lines is helping build Chaus into a lifestyle brand.
The company has added 70 doors to its distribution this fall and is grabbing additional space in existing doors due to good demand for the brand, according to Chaus. She said many doors are experiencing sales gains of between 25 and 50 percent because of the broader product assortment.
Chaus said the mission of the new president will be to broaden distribution. Chaus lines are currently in 700 doors, and she sees the potential for 1,500 doors in the U.S.
The company will launch its first-ever print campaign this fall for its spring 2000 line, and plans to start opening in-store shops in department stores in early 2000.
The company will move its showroom at the end of the year to 530 Seventh Avenue from 1410 Broadway. The new showroom will feature two levels instead of four and allow for a better display of its lines, including a replica of its in-store shops to show the concept to buyers.
“Our strong momentum is continuing and we believe we can achieve sustained earnings growth going forward,” the chairwoman said.
On the New York Stock Exchange Tuesday, Chaus shares closed at 2 15/16, up 1/8.