NEW YORK — An expected plunge in sales flipped Tefron Ltd. to a loss in the third quarter.
This story first appeared in the November 11, 2003 issue of WWD. Subscribe Today.
For the three months ended Sept. 30, the Bnei-Brak, Israel-based seamless intimate apparel and activewear manufacturer posted a net loss of $1.1 million, or 9 cents a diluted share. By comparison, last year the firm recorded profits of $1.2 million, or 9 cents, and, excluding a special charge in that period, earnings would have been an even better $2.9 million.
Net sales for the quarter fell by more than a fifth, or 21.3 percent, to $39.4 million from $50.1 million a year ago. A 440 basis-point expansion of selling, general and administrative costs to 13.4 percent of sales also contributed to the net loss.
“Sales for the quarter were in line with our previously stated expectations,” said chief executive officer Yos Shiran in a statement. “Although this was our second consecutive quarter of decreased sales, we expect sales for the fourth quarter to improve to around $42 million. We also expect to report improved results in the fourth quarter. This recovery is expected to continue in the first quarter and throughout 2004.”
Sales for full fiscal 2004 are forecast to grow in the mid-teens, Shiran said, based on an expansion of Tefron’s activewear business and its continued push into the mass market channel.
For the first nine months of the year, Tefron greatly narrowed its net loss to $1.3 million, or 1 cent, from $14 million, or $1.13, a year ago. However, excluding an accounting change in the prior-year period, the firm would have recorded earnings of $4.8 million, or 39 cents.
Sales for the nine months retreated 12.3 percent to $122.7 million from $140 million a year ago.