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GITANO GROUP ANNOUNCES FINAL PHASE OF RESTRUCTURING

 GITANO GROUP ANNOUNCES FINAL PHASE OF RESTRUCTURING
 NEW YORK, Dec. 26 /PRNewswire/ -- The Gitano Group, Inc. (NYSE: GIT)


announced today the final phase of a restructuring program begun in August 1990. This will entail a one time restructuring charge in the amount of $6.5 million to be taken in the fourth quarter ending Dec. 31, 1991. The charge includes provisions for manufacturing and distribution facilities relocation and reorganization which have been previously reported. It also includes an additional provision for the closing of Gitano retail stores which are not in outlet locations.
 "The program was designed to streamline the company, refocus our business on strategic account relationships with our key mass merchant retailers, and emphasize pre-selling. The transition is virtually compete and on schedule as evidenced by our current order back log which is substantially ahead of last year," said Haim Dabah, president and chief operating officer of The Gitano Group, Inc.
 The company also announced that, for the first time in its history, it expects to report a loss from operations for the fiscal year ending Dec. 31, 1991. Fourth quarter sales and earnings have been adversely impacted by retailers postponing receipt of spring orders originally scheduled for shipment in December 1991 until the first quarter of 1992. Margins have been further impacted by the weak and highly promotional sales at Gitano retail stores as well as aggressive year end mark downs.
 "While we expect economic conditions to remain poor throughout 1992, we believe that with the strong partner relationships we have established with key retailers, our pre-sell and our lower cost structure, the company will return to its traditional profit levels," Dabah said.
 The Gitano Group, Inc.'s primary business is supplying branded, high quality, affordable apparel to mass merchants and discounters. Gitano's products include fashion basic clothing for women, men and children, as well as intimate apparel and accessories. The average retail price of our apparel is under $20.
 Gitano licenses its brands for certain products such as socks, watches and athletic footwear. We also operate 104 company-owned retail stores at outlet locations selling Gitano products exclusively. The company's other brands include Gloria Vanderbilt, which is sold to moderate department and specialty stores, and Regatta Sport, which is sold to upscale department and specialty stores, and catalogues.
 With Home Offices in Manhattan, Gitano has 12 foreign offices and owns factories in the United States, the Caribbean basin and Central America, and manages a network of manufacturers and suppliers in over 35 countries throughout the world.
 -0- 12/26/91
 /CONTACT: Stan Greenstein, chief financial officer of Gitano, 908-248-1220/
 (GIT) CO: Gitano Group, Inc. ST: New York IN: TEX SU: RCN


KD -- NY022 -- 5349 12/26/91 16:25 EST
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Publication:PR Newswire
Date:Dec 26, 1991
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