G-III Apparel Group, Ltd. Announces Third Quarter Fiscal 2005 Results
NEW YORK, Dec. 7, 2004 -- G-III Apparel Group, Ltd. (GIII) today announced results for the third quarter of fiscal 2005.
For the three-month period ended October 31, 2004, G-III reported net sales of $114.9 million and net income of $9.9 million, or $1.33 per diluted share, compared to net sales of $125.5 million and net income of $11.4 million, or $1.50 per diluted share, in the comparable period last year.
For the nine-month period ended October 31, 2004, G-III reported net sales of $175.3 million and net income of $3.4 million, or $0.46 per diluted share, compared to net sales of $189.6 million and net income of $11.5 million, or $1.54 per diluted share, in the comparable period last year.
The current nine-month period includes a non-cash charge of $882,000, equal to $0.12 per share, associated with the Company's decision to attempt to sell its joint venture interest in a factory in China.
Morris Goldfarb, G-III's Chief Executive Officer, said, "Although the market is a bit softer than we had anticipated, we are pleased with the direction of our business in general. While we expect to end up below our plan for the year, our financial position is strong and we are looking forward to capitalizing on growth opportunities in the upcoming year with both existing and new businesses. As we announced last week, we renewed our license for Kenneth Cole women's outerwear and expanded our relationship with Kenneth Cole to now include men's outerwear. This new men's line will commence shipping for the fall 2005 season. This addition is an important part of our goal to establish ourselves as a leader in men's outerwear."
The Company has revised its guidance for the fiscal year ending January 31, 2005. For the fiscal year, the Company now forecasts net income per diluted share between $0.18 and $0.23, changed from its previously announced forecast of $0.38 to $0.43 per diluted share. These forecasts include the effect of the previously announced non-cash charge of $882,000, equal to $0.12 per share, associated with the Company's decision to attempt to sell its joint venture interest in a factory in China. The Company's forecast for net sales for the year remains at approximately $215 million.
About G-III Apparel Group, Ltd.
G-III Apparel Group, Ltd. is a leading manufacturer and distributor of outerwear and sportswear under licensed labels, our own labels and private labels. The Company has fashion licenses with Kenneth Cole, Nine West, Timberland, Cole Haan, Cece Cord, Jones Apparel, Sean John, Bill Blass, and James Dean and sports licenses with the National Football League, National Basketball Association, Major League Baseball, National Hockey League, Louisville Slugger, NASCAR, World Poker Tour and more than 60 universities nationwide. Company-owned labels include, among others, Black Rivet, Colebrook and Siena Studio.
Statements concerning the Company's business outlook or future economic performance, anticipated revenues, expenses or other financial items; product introductions and plans and objectives related thereto; and statements concerning assumptions made or expectations as to any future events, conditions, performance or other matters are "forward-looking statements" as that term is defined under the Federal Securities laws. Forward-looking statements are subject to risks, uncertainties and factors include, but are not limited to, reliance on foreign manufacturers, the nature of the apparel industry, including changing customer demand and tastes, reliance on licensed product, seasonality, customer acceptance of new products, the impact of competitive products and pricing, dependence on existing management, general economic conditions, as well as other risks detailed in the Company's filings with the Securities and Exchange Commission. The Company assumes no obligation to update the information in this release.
G-III APPAREL GROUP, LTD. AND SUBSIDIARIES
(GIII)
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
10/31/04 10/31/03 10/31/04 10/31/03
---------- ---------- ---------- ----------
Net sales $ 114,909 $ 125,547 $ 175,322 $ 189,558
Cost of sales 81,358 88,208 129,471 132,184
---------- ---------- ---------- ----------
Gross profit 33,551 37,339 45,851 57,374
Selling general and
administrative expenses 15,638 16,785 37,502 36,388
Write down of equity
investment 882
---------- ---------- ---------- ----------
Operating profit 17,913 20,554 7,467 20,986
Interest and financing
charges, net 550 583 820 861
---------- ---------- ---------- ----------
Income before income taxes 17,363 19,971 6,647 20,125
Income tax expense 7,466 8,591 3,237 8,654
---------- ---------- ---------- ----------
Net income $ 9,897 $ 11,380 $ 3,410 $ 11,471
========== ========== ========== ==========
Basic net income per
common share $ 1.38 $ 1.65 $ 0.48 $ 1.67
========== ========== ========== ==========
Diluted net income per
common share $ 1.33 $ 1.50 $ 0.46 $ 1.54
========== ========== ========== ==========
Weighted average shares outstanding:
Basic 7,190,000 6,900,000 7,158,000 6,885,000
Diluted 7,429,000 7,571,000 7,480,000 7,428,000
Balance Sheet Data (in thousands): At At
Oct. 31, Oct. 31,
---------- ----------
2004 2003
---------- ----------
Working Capital $ 62,359 $ 59,128
Inventory 37,010 40,498
Total Assets 137,413 146,552
Outstanding Borrowings 36,211 43,418
Total Shareholders' Equity $ 69,115 $ 67,387
CONTACT: For: G-III Apparel Group, Ltd. Investor Relations: James Palczynski 203-222-9013 G-III Apparel Group, Ltd. Chief Financial Officer Wayne S. Miller 212-403-0500