CHAUS QUARTER LOSS INCREASES TO $4.3M
NEW YORK — Bernard Chaus Inc. on Tuesday reported a deeper second-quarter loss than a year ago and said additional sources of financing will be required to adequately support the business.
The firm said it has retained Lehman Bros. to explore various alternatives available to the company.
In fall of 1995, Lehman underwrote a secondary offering for Chaus of 5 million shares at $3 each.
At the same time, Chaus noted it is receiving continued support from The Bank of New York, which has waived noncompliance with financial covenants for the period ended Dec. 31.
For its fiscal second quarter ended Dec. 31, Chaus reported a net loss of $4.3 million, against a loss of $3.9 million posted in the year-earlier period.
Sales for quarter fell 22.3 percent to $38.1 million from $49 million.
In the half, Chaus narrowed its loss to $3.9 million from $4.3 million.
Sales declined 12.1 percent to $86.1 million from $97.9 million.
The manufacturer of sportswear has been consistently reporting losing money during recent years.
While it was in the black in the first quarter of this fiscal year, that was the 1first profitable quarter since the three months that ended in December 1993.
“As anticipated, the losses for the quarter and six month periods were roughly comparable to the losses we incurred for the same periods last year,” Josephine Chaus, chairwoman, and Andrew Grossman, chief executive officer, said in a joint statement.
They noted that gross margins for both periods improved over the year-ago period, as the company started shipping its licensed Nautica women’s line and reduced the level of off-price sales for core Chaus products.
They added that they expect a “substantially improved operating performance” in the second half.
“This improvement is expected to come from continued shipments of our Nautica line, coupled with improved performance of the Chaus line,” the executives said.
Chaus’s stock closed Tuesday at 1 off 1/8 on the New York Stock Exchange.