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Kellwood Achieves Record Second Quarter; Regular Quarterly Dividend Declared

ST. LOUIS, Nov. 26 /PRNewswire/ -- Kellwood Company (NYSE: KWD) reported record sales and earnings today for the second quarter ending October 31, 1996, according to William J. McKenna, chairman and chief executive officer. Sales for the quarter were $429,435,000, up from last year's record quarter of $425,635,000. Net earnings increased 3% to $14,438,000, or $0.67 per share, from $14,019,000, or $0.65 per share.

Sales for the six-month period were down slightly to $756,870,000, compared to $766,260,000 a year earlier. Net earnings were $20,256,000, or $0.94 per share, up 3% from $19,663,000, or $0.91 per share.

"Operationally, Kellwood has taken steps to enhance its competitive position by containing overhead spending and shifting more of our contractor production from domestic to offshore. Kellwood ended the quarter with a very satisfactory 83 days supply of inventory, down 5 days from the level carried last year.

"Kellwood has been working on a number of marketing programs and initiatives with a broad range of leading retailers in each of our three business portfolios. These efforts should begin to bear fruit during our third and fourth quarters. Additionally, the cost of consolidating and restructuring certain businesses, which was largely incurred during the second half of fiscal 1996, is now behind us. As we move into the second half of this fiscal year, we should continue to gain market share with the leading retailers in the United States and also see an improvement in our operating margin as compared to the prior year," commented McKenna.

On September 30, Kellwood Company adopted a common stock repurchase program. The Company is authorized to repurchase up to 10% of the approximately 21,000,000 outstanding shares of its common stock. As of November 22, approximately 324,300 shares have been repurchased.

The Board of Directors declared a regular quarterly dividend of $0.15 per common share, payable December 20, 1996, to shareholders of record December 6, 1996.

Kellwood Company is an international marketer, merchandiser, and manufacturer of apparel. Known for its diversity, Kellwood's 17 business units offer a wide range of apparel -- from innerwear to outerwear -- which is sold through all channels of distribution. Kellwood's revenues for fiscal 1996 were $1.47 billion. Kellwood ... creating a world of value through its family of companies.

KELLWOOD COMPANY AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (UNAUDITED)
 (Amounts in thousands)
 October 31,
 1996 1995


ASSETS

CURRENT ASSETS:
 Cash and time deposits $40,982 $15,593
 Receivables, net 258,247 261,390
 Inventories 247,857 236,217
 Prepaid taxes and expenses 19,996 19,977
 TOTAL CURRENT ASSETS 567,082 533,177
 PROPERTY, PLANT AND EQUIPMENT, NET 63,667 65,704
 INTANGIBLE ASSETS, NET 116,873 123,728
 OTHER ASSETS 72,010 64,760
 $819,632 $787,369


LIABILITIES AND SHAREOWNERS' EQUITY

CURRENT LIABILITIES:
 Current portion of long-term debt $20,439 $8,164
 Notes payable 143,063 127,789
 Accounts payable 96,914 85,283
 Accrued expenses 62,595 64,597
 TOTAL CURRENT LIABILITIES 323,011 285,833
 LONG-TERM DEBT 118,996 139,585
 DEFERRED INCOME TAXES AND OTHER 39,863 39,647
 SHAREOWNERS' EQUITY 337,762 322,304
 $819,632 $787,369
 KELLWOOD COMPANY AND SUBSIDIARIES
 CONSOLIDATED STATEMENT OF EARNINGS (UNAUDITED)
 (Amounts in thousands except per share data)
 Three Months Ended Six Months Ended
 October 31, October 31,
 1996 1995 1996 1995
 NET SALES $429,435 $425,635 $756,870 $766,260


COSTS AND EXPENSES:
 Cost of products sold 341,751 337,182 603,655 608,390


Selling, general and
 administrative expenses 54,306 55,202 101,095 105,349


Amortization of
 intangible assets 3,810 3,899 7,628 7,847
 Interest expense 5,388 6,281 10,566 12,208


Interest income
 and other, net (758) (748) (1,030) (897)
 EARNINGS BEFORE INCOME TAXES24,938 23,819 34,956 33,363
 INCOME TAXES 10,500 9,800 14,700 13,700
 NET EARNINGS $14,438 $14,019 $20,256 $19,663


WEIGHTED AVERAGE SHARES

OUTSTANDING:
 Primary 21,239 21,157 21,238 21,145
 Fully diluted 21,557 21,559 21,556 21,547


EARNINGS PER SHARE:
 Primary $0.68 $0.66 $0.95 $0.93
 Fully diluted $0.67 $0.65 $0.94 $0.91


SOURCE Kellwood Co.
 -0- 11/26/96


/CONTACT: Financial: James C. Jacobsen, 314-576-3429, or Roger D. Joseph, 314-576-3437; or Media: Donna B. Weaver, 314-576-3265/

(KWD)

CO: Kellwood Co. ST: Missouri IN: REA SU: ERN

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