DESIGNS INC. NET FALLS TO $1.9M FROM $8.5M
NEW YORK — Designs Inc. reported fourth-quarter earnings plummeted to $1.9 million, or 12 cents a share, from $8.5 million a year ago, or 54 cents, after a $4.2 million pretax gain related to a 1993 restructuring charge.
The special gain was a partial reversal of a prior year’s $15 million restructuring charge for store closings, Bill Richins, chief financial officer, told WWD. Excluding the gain, the company earned 12 cents against 38 cents a year ago.
Sales for the three months ended Feb. 3 rose 9.8 percent to $87.5 million, from $79.8 million.
“It was a year characterized by weak consumer demand for apparel, which lead to disappointing sales results for both the back-to-school and holiday selling seasons,” Joel H. Reichman, president and chief executive officer, said in a statement.
The company opened 10 stores during the fiscal year and a joint venture between Designs and Levi’s Only opened three Original Levi’s stores. For the full year, earnings fell to $9.8 million, or 62 cents, from $16.9 million, or $1.06, including a fourth quarter special gain and an additional $2.2 million gain taken in the year-ago first quarter. The special item also included a gain related to the sale of some stores to Levi’s Only Stores, a subsidiary of Levi Strauss & Co.
Excluding the special items, the company earned 54 cents against 90 cents a year ago. Sales were up 13.2 percent to $301.1 million from $265.9 million.
— Fairchild News Service