DONNKENNY SEES FIRST PROFIT SINCE ’95
Byline: Jennifer Weitzman
NEW YORK — A small fourth-quarter profit provided Donnkenny Inc. with its first profitable year since 1995.
The New York-based maker of moderately priced women’s apparel earned $15,000 and earnings per diluted share broke even for the three months ended Dec. 31. That reverses year-ago losses totaling $2.7 million, or 62 cents. In the fourth quarter of 2001, the company recorded a charge of $300,000 million related to the write-down of assets held for sale.
Sales slumped 2.7 percent to $40.1 million versus $41.2 million last year.
Referring to the aftermath of Sept. 11, Daniel Levy, chairman and chief executive officer said in a statement: “We were well positioned prior to the fourth quarter, but lost a lot of momentum, as did many others in the apparel industry. Nevertheless, it is gratifying to have achieved our first profitable year since 1995, however small it was.
“While the continued recession and slow retail climate continue to affect our business, we have confidence that profitability is here to stay at Donnkenny,” he added.
For the full fiscal year, profits reached $44,000, or 1 cent a diluted share, compared with a reported loss of $8.9 million, or $2.26, in 2000.
Sales rose 0.7 percent to $152.2 million versus $151.1 million.
The increase in sales was due to increases of $6.8 million in the Donnkenny line, $11.9 million in the Pierre Cardin Knits line, $5.3 million in the Pierre Cardin Options line and $5.8 million in the Ann Travis line, which includes the license for Delta Burke sportswear. The company exited the dress business last October. However, according to a Form 10-K filed with the Securities and Exchange Commission, these gains were offset by declines of $7.2 million in the Victoria Jones line and $21.5 million in the Casey & Max line.
Of Donnkenny’s net sales for fiscal 2001, department stores accounted for roughly 50 percent, wholesale clubs 26 percent, catalog customers 10 percent, mass merchants approximately 6 percent, chain stores 5 percent and specialty retailers 2 percent.