Danskin Announces Third Quarter Results.NEW YORK--(BUSINESS WIRE)--Nov. 11, 1998--Danskin, Inc. (DANS) today announced results for the fiscal third quarter ended September September: see month. 27, 1998, showing improved gross margins as a result of the focus on higher-end, higher margin, value added Value Added The enhancement a company gives its product or service before offering the product to customers. Notes: This can either increase the products price or value. product lines. For the quarter ended September 26, 1998, net revenues were $28.0 million, resulting in a net loss applicable to common stock of $2.1 million, or a loss of $0.11 per common share based on approximately 19.7 million shares outstanding. For the prior year fiscal quarter, net revenues were $32.7 million, resulting in net income applicable to common stock of $4.8 million, or $0.50 per share on approximately 9.7 million shares outstanding. The prior year fiscal quarter included an extraordinary gain of $5.2 million for the early retirement of debt. The Company's net loss applicable to common stock for the fiscal nine month period was $4.8 million, or a loss of $0.33 per common share compared to net income applicable to common stock for the prior fiscal year period of $2.1 million, or $0.28 per common share. Excluding certain one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. and non-recurring charges totaling $2.2 million, the Company's net loss applicable to common stock for the fiscal nine month period would have been $2.6 million, or $0.18 per common share, an improvement of $0.2 million or $.22 per common share over the prior year fiscal nine month period before the effect of the extraordinary item. In its legwear division, the Company realized a $0.9 million gross margin improvement for the fiscal nine month period, despite a $3.2 million decline in net revenues. The improvement is due to cost reductions at the Company's manufacturing facility, a focus on value-added val·ue-add·ed adj. Of or relating to the estimated value that is added to a product or material at each stage of its manufacture or distribution: , higher margin products and the elimination of certain lower margin programs. Gross margins as a percentage of net revenues for the fiscal nine month period were 32.7%, a 6.3 percentage point improvement over the comparable prior year period. Revenues declined $1.6 million for the comparable fiscal quarter and $3.2 for the comparable fiscal nine months. Wholesale revenues in the Company's activewear division declined $3.1 million during the fiscal quarter and $7.1 million for the nine months ended September 26, 1998. The revenue declines are primarily attributable to the reduction in private label manufacturing and a general softness in the retail industry. The Company has, however, experienced improved gross margins as a percentage of net revenues for both the fiscal third quarter (41.2% versus 38.7%) and the fiscal nine months of the year (40.7% versus 37.8%) over the prior fiscal year periods. This improvement is primarily attributable to a shift in the product mix toward Danskin branded merchandise over lower margin private label merchandise. Donald Schupak, Danskin's Chairman, stated that "A lot of intrinsic value Intrinsic Value 1. The value of a company or an asset based on an underlying perception of the value. 2. For call options, this is the difference between the underlying stock's price and the strike price. has been created by the Company's new management team in a short period of time under less than ideal conditions. The Company's cost structure has been streamlined across the board resulting in a modest improvement in results before extraordinary and restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. . Most importantly Adv. 1. most importantly - above and beyond all other consideration; "above all, you must be independent" above all, most especially , substantial progress has been made in shedding problems resulting from years of undercapitalization Undercapitalization refers to any situation where a business owner cannot acquire the funds they need. Usually, this refers to a business that cannot afford current operational expenses due to a lack of capital, which can trigger bankruptcy. and survival rather than brand focused management. We believe that whatever remains of the Company's legacy issues will be put behind us in the near term, allowing the results of the undivided UNDIVIDED. That which is held by the same title by two or more persons, whether their rights are equal, as to value or quantity, or unequal. 2. Tenants in common, joint-tenants, and partners, hold an undivided right in their respective properties, until focus of the new management team, the improved cost structure and the investment the Company has made and continues to make in personnel, machinery and information technology, to add directly to the bottom line and the strength of the brand." Cathy Volker, Chief Executive Officer, continued, stating that, "Despite certain short term obstacles, the energies of the senior management team continue to be focused on establishing Danskin(R) as a modern, contemporary brand, capitalizing on the consumer recognition of the Danskin(R) brand, and developing new and innovative activewear and legwear products that reflect a woman's active lifestyle." "The Company recently launched its Danskin Packables line in the department store channel. We are enthusiastic about the retail and consumer acceptance of the Danskin Packables line and believe that it marks the repositioning repositioning Laparoscopic surgery The changing of a Pt's position during a procedure to improve access or visualization of the operative field, which may be linked to complications, as it changes anatomic planes of operation. Cf Laparoscopic surgery. of the Danskin(R) brand to the consumer beyond `activewear' to one of `active lifestyle' -- the women's brand of tomorrow. Danskin Packables is offered primarily in the hosiery hosiery Knit or woven coverings for the feet and legs, worn inside shoes. In the 8th century BC, Hesiod referred to linings for shoes; the Romans wrapped their feet, ankles, and legs in long strips of leather or woven cloth. departments of department stores This is a list of department stores. In the case of department store groups the location of the flagship store is given. This list does not include large specialist stores, which sometimes resemble department stores. and better specialty stores Noun 1. specialty store - a store that sells only one kind of merchandise shop, store - a mercantile establishment for the retail sale of goods or services; "he bought it at a shop on Cape Cod" and features an accessible product (offered primarily on main floor), an innovative design (superior styling coupled with an exclusive technical fabric that resists wrinkles wrinkles See bells and whistles. ), and a unique concept (a mix and match ensemble The word ensemble can refer to
"The success of the Danskin Packables line in the department store channel somewhat offset declines in activewear revenues. We are seeing that there is general sluggishness in the sporting goods Noun 1. sporting goods - sports equipment sold as a commodity commodity, trade good, good - articles of commerce sports equipment - equipment needed to participate in a particular sport channel due to the overall inventory positions of certain of our major accounts. With the pressures on the retail industry in general, and the clogged sporting goods channel in particular, we recognize that we must distinguish ourselves by offering innovative, higher-end, value added products, while eliminating lower margin, less profitable product lines. This focus has resulted in improved gross margin percentages through the third quarter despite the revenue declines. " "We also recognize that our own retail stores provide a valuable platform for capitalizing on the strong brand awareness enjoyed by Danskin. While providing an additional channel of distribution, they also serve as a laboratory for product innovation. We continually con·tin·u·al adj. 1. Recurring regularly or frequently: the continual need to pay the mortgage. 2. challenge the performance of our retail operations. We have closed six non-performing locations this year, while taking the steps necessary for improved performance in our remaining stores, including installing point-of-sale systems to provide critical inventory and sales information, and implementing visual merchandising Visual merchandising is creating visual displays and arranging merchandise assortments within a store to improve the layout and presentation and to increase traffic and sales. programs to achieve a consistent and identifiable retail impression and presence. We intend to open a limited number of additional full price Danskin(R) stores in select metropolitan areas to take full advantage of the brands awareness factor." "Our Pennaco legwear division is well positioned to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. its manufacturing expertise. The Company has made significant progress in achieving a more focused sales effort toward higher margin product and consumer interest in casual legwear and in reducing its manufacturing costs. Together, these initiatives reflect the Company's objective to redirect re·di·rect tr.v. re·di·rect·ed, re·di·rect·ing, re·di·rects To change the direction or course of. n. A redirect examination. re its efforts to areas where it recognizes a competitive advantage." Ms. Volker added that "As with our activewear business, we are pursuing sustained revenue growth in our legwear division by increasing our position in higher end Coordinates: For other places with the same name, see Billinge. Higher End or Billinge Higher End is a district of the Metropolitan Borough of Wigan, in Greater Manchester, England. , higher value-added legwear products. The licensing opportunities presently available to the Company compliment Not to be confused with Complement. Compliment may be
Danskin, Inc. markets and manufactures women's activewear and dancewear dance·wear n. Clothing such as leotards and warmup suits that are worn for dance practice and exercising. under the Danskin trademark and legwear under the Danskin, Round-the-Clock and Givenchy trademarks. Pennaco Hosiery, a division of Danskin, Inc., is the largest manufacturer of private label hosiery sold in department stores and fine specialty stores nationwide. This press release may contain forward looking statements with respect to operations, assumptions, the financial condition and future performance of the Company. Additional information on risk factors that could potentially have a material impact on the Company's operations and financial position, and risk factors relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc management of the Company is contained in the Company's filings with the Securities and Exchange Commission. -0-
DANSKIN, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(IN THOUSANDS)
Three Months Nine Months
Ended Ended
(Unaudited) (Unaudited)
9/27/97 9/26/98 9/27/97 9/26/98
Net Revenues
Danskin $ 22,457 $ 19,343 $ 63,738 $ 56,628
Pennaco 10,242 8,616 29,215 26,026
-------- -------- -------- --------
Total 32,699 27,959 92,953 82,654
-------- -------- -------- --------
Gross Margins
Danskin 8,747 8,029 24,114 23,039
Pennaco 2,884 2,784 7,655 8,522
-------- -------- -------- --------
Total 11,631 10,813 31,769 31,561
-------- -------- -------- --------
S, G & A 10,200 11,487 30,236 32,075
-------- -------- -------- --------
Operating Income (Loss) 1,431 (674) 1,533 (514)
Non-Recurring Charges (1) 300 475 300 1,439
Interest Expense 1,251 669 3,686 1,850
-------- -------- -------- --------
Loss Before Income
Tax Provision (120) (1,818) (2,453) (3,803)
Income Tax Provision 194 44 292 135
-------- -------- -------- --------
Net Loss before
Extraordinary Items (314) (1,862) (2,745) (3,938)
Extraordinary Gain 5,245 0 5,245 0
-------- -------- -------- --------
Net Income (Loss) 4,931 (1,862) 2,500 (3,938)
Preferred Stock
Dividends 112 271 362 843
-------- -------- -------- --------
Net Income (Loss)
Applicable to Common Shares $ 4,819 ($ 2,133)$ 2,138 ($ 4,781)
======== ======== ======== ========
Basic/Diluted net
income (loss) per share
Net loss per share
before extraordinary items ($0.04) ($0.11) ($0.40) ($0.33)
Net income per share
for extraordinary items $ 0.54 $ 0.00 $ 0.68 $ 0.00
-------- -------- -------- --------
Net income (loss) per
share after
extraordinary items $ 0.50 ($ 0.11)$ 0.28 ($ 0.33)
Weighted Average
Number of Common
Shares 9,677 19,689 7,673 14,585
(1) Related to expenses associated with the pre-existing executive severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when contracts. |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion