MCNAUGHTON’S EARNINGS JUMP TO $2.5M IN QUARTER
NEW YORK — Aided by better margins and improved sales, McNaughton Apparel Group, formerly known as Norton McNaughton, reported third-quarter earnings climbed to $2.5 million, or 32 cents a diluted share, from a loss of $705,000 last year.
The career and casual apparel firm’s year-ago results included an aftertax charge of $1.2 million related to the early extinguishment of debt. Excluding the extraordinary item, the year-ago earnings were $456,000, or 6 cents a share.
Sales in the quarter ended July 31 gained 16.1 percent to $92.9 million from $80 million. Peter Boneparth, chief executive officer, in a statement said the company had “across-the-board improvements that well exceeded management’s internal plans.
“We were able to achieve better margins in all our businesses due to less markdowns and better inventory control,” Boneparth told WWD. “This was largely due to the strong performance in our Jeri-Jo division as well as Miss Erika. Also, we interpreted career casual a bit better this year.”
The company operates three subsidiaries: Norton McNaugh-ton, which includes the Norton McNaughton and Norton Studio labels; Miss Erika, a casual sportswear business comprised of the Miss Erika and Squire labels, and Jeri-Jo Knitwear, a business targeting younger customers that includes the Energie, Currants and Jamie Scott labels.
Miss Erika in particular has benefited from the trend toward casualization, Boneparth noted.
“We saw nice growth in the quarter in terms of top-line improvement, and we expect to see growth in all three of our businesses going forward. In general, we are optimistic about our business,” he said.
In the nine months, earnings were $3.6 million, or 47 cents a share, against a loss of $234,000 last year. Excluding the extraordinary item, profits rose substantially from $927,000 or 13 cents a share.
Sales climbed 24.5 percent to $283.4 million from $227.6 million.