NEW YORK — Profits at Wacoal Corp. skidded 14.1 percent in its year ended March 31 as weakness in its core Japan market offset strength in the U.S. related to the launch of DKNY intimates.
The Kyoto, Japan, firm, which said it is the world’s largest intimate apparel maker, earned $70.5 million in the year, down from $82.7 million a year ago. Results were converted from yen using the exchange rate as of March 31.
Sales dipped 2.4 percent to $1.62 billion from $1.65 billion.
Wacoal America’s sales jumped 37 percent due to the spring 1999 launch of DKNY. Its American subsidiary’s labels include Wacoal, Wacoal Silver, Wacoal Petite, Donna Karan Intimate and DKNY.
The American performance was undermined by sluggishness in Japan, which Wacoal said “continued to show a lack of any substantial signs of recovery.”
It added, “Basic intimate apparel sales remained low due to lackluster consumer spending and the dismal performance of the retail industry, evident through closures and consolidation of the major department stores, as well as the arrival of a new generation of retail and distribution channels.”
To improve results, Wacoal said it worked on improving operating efficiencies and controlling expenses. However, expenses for a new headquarters building affected earnings last year. Wacoal projected earnings this year would rise 45 percent to $102 million on flat sales.