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GITANO GROUP INC. REPORTS RESULTS

 GITANO GROUP INC. REPORTS RESULTS
 NEW YORK, Aug. 18, /PRNewswire/ -- As it previously reported, The


Gitano Group, Inc. (NYSE: GIT) today stated it incurred a net loss for the second quarter ended June 30, 1992 of $95.1 million, primarily reflecting $78 million of writedowns related to inventory, receivables and other assets; $2.4 million costs associated with the company's restructuring effort, including financial, legal and other advisor fees; and $6 million of interest expense. For the second quarter of year ago, Gitano had a net loss of $2.1 million.
 For the 1992 second quarter Gitano's sales increased to $210.1 million from $177.6 million for the previous year's quarter.
 Gitano is undertaking strategic actions to refocus on its core wholesale business, to downsize its non-core operations, reduce its balance sheet proportionately and improve its liquidity and financial flexibility. While these actions have an adverse impact on the company's near term performance, they are designed to position Gitano as a highly competitive company for the long term.
 On Aug. 17, 1992, Gitano reported that it had informed its lenders of its 1992 second quarter loss. It also reported it had reached an agreement with its lenders which includes the extension of the company's Letter of Credit facilities to March 15, 1993 and thirty day covenant waivers by its lenders so that the company is no longer in default under its credit agreements. During the thirty day period, Gitano and its lenders will negotiate new financial covenants.
 Gitano is a leading supplier of 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 GITANO GROUP, INC.
 Consolidated Statements of Operations
 (Dollars in thousands, except per share date, unaudited)
 Periods ended Six months Three months
 June 30 1992 1991 1992 1991
 Net sales $444,212 $371,419 $210,115 $177,604
 Cost of sales 380,355 278,796 203,906 135,106
 Gross Profit 63,857 92,623 6,209 42,498
 Selling and
 dist. expenses 65,119 60,592 34,067 29,760
 General and
 admin. expenses 31,232 23,693 16,005 12,098
 Provisions for doubtful
 amounts due from
 affiliates and
 related parties 32,581 -- 32,581 --
 Restruct. costs 10,453 -- 10,453 --
 Income (loss)
 from operations (75,528) 8,338 (86,897) 640
 Debt restruct.
 costs 2,177 2,177
 Interest expenses 11,015 9,474 6,077 4,896
 Loss bef. provisions
 (benefit) for
 income taxes (88,720) (1,136) (95,151) (4,256)
 Provision (benefit)
 for income taxes 271 (1,525) (1,215) (2,149)
 Income (loss) before
 extraord. debt (88,991) 389 (93,936) (2,107)
 Extraordinary debit-
 reversal of inc. tax
 reduction arising from U.S.
 operating loss carryforward
 recognized in prior
 interim period -- -- 1,165 --
 Net income (loss)($88,991) $389 ($95,101) ($2,107)
 Earnings (loss) per share
 of com. stock:
 Income (loss) bef.
 extraord. debit ($5.56) $0.02 ($5.87) ($0.13)
 Net income (loss) ($5.56) $0.02 ($5.94) ($0.13)
 Weighted avg. shares
 outstanding 15,998,717 15,977,953 15,998,717 15,977,964
 -- (A) Effective with the second quarter of 1992, Gitano has changed its fiscal year end from Dec. 31 to the 52 or 53 week period which ends on the Saturday nearest to Dec. 31. For presentation purposes, Gitano consolidated financialstatements will continue to refer to the quarter's calendar month end.
 -0- 8/18/92
 /CONTACT: Robert D. Siegfried of Kekst and Company, 212-593-2655/
 (GIT) CO: Gitano Group, Inc. ST: New York IN: TEX SU: ERN


AH -- NY083 -- 1163 08/18/92 19:47 EDT
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Date:Aug 18, 1992
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