DM MANAGEMENT PLANS SECONDARY STOCK OFFERING

NEW YORK — DM Management Co., a women’s apparel catalog firm that recently rebounded from operating problems, plans to sell 1 million shares in a secondary stock offering.
At current prices, the owner of the J. Jill and Nicole Summers upscale catalogs would raise about $12 million.
Allstate Insurance Co. plans to sell another 1.75 million shares in the offering, which will cut its stake in DM to 5.4 percent from 37.5 percent.
The company’s proceeds will be used to help buy land and build a fulfillment center in Tilton, N.H.
DM estimates that the center will cost between $25 million and $30 million.
The stock offering comes after the company’s turnaround lifted its stock price. DM shares closed at 13 3/4, up 5/8 Friday on the over-the-counter market. It has ranged from 2 7/8 to 14 1/4 over the past 12 months.
In the half ended June 28, DM’s earnings from continuing operations more than doubled to $1.7 million, or 35 cents a share, from $800,000, or 17 cents, a year ago. In the year-ago half, DM sustained a net loss of $8.2 million after a $9 million charge to discontinue its Carroll Reed catalog.
Six-month sales at the Hingham, Mass.-based company jumped 39 percent to $57.4 million from $41.3 million.
In the prospectus for its offering, DM attributed its improved performance to a more fashion-driven focus; a larger assortment of accessories, shoes and gifts, and the expansion of private label and special size merchandise.
DM also said it has been helped by phasing out the Carroll Reed catalog and merging The Very Thing! catalog into Jill Summers last year.
DM now concentrates on J. Jill and Nicole Summers, which both target affluent women over the age of 35. J. Jill features more casual styles, with private label accounting for about 75 percent of its mix.
Nicole Summers, which features classic suits and sportswear, does about one-third of its business in private label, with the balance coming from brands such as Ruth Norman, Castleberry Knits, Adrianna Papell, Adrienne Vittadini, Bleyle and Leo Narducci.
DM said it plans to significantly increase customer lists for J. Jill over the near term.
The catalog firm also expects help from the introduction of merchandise categories such as high-end crystal brands like Baccarat and Waterford, which are offered in its Nicole Summers Holiday 1996 catalog.
DM also said it might pursue on-line electronic shopping or open retail stores to showcase its brands.

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