Liz Claiborne Announce Loss In Q2

Thursday, 14 August 2008
The Liz Claiborne empire announced a loss in the second quarter. The results of the company, with its global portfolio of premium brands such as Kate Spade, Juicy Couture and Lucky Brand Jeans, were hampered by selling off of a slew of brands and an overall sales decline in its department stores accounts. On Wednesday, Liz Claiborne Inc posted a loss of $23.2 million, or 25 cents per share, in the quarter ended July 5, compared with a $13.6 million, or 13 cent, earnings gain over the same period last year. The loss came despite cutting $22 million in selling, general and administrative expenses in the second quarter. The New York based company narrowed its projected earnings per share for the fiscal year to $1.40 to $1.50.

Revenues at Claiborne’s direct brands increased 17 percent to $578 million, a 10 percent growth when excluding currency exchange rate. Juicy Couture has been leading the growth with its 48 percent increase in sales. Lucky Brand sales were up 9% and Kate Spade sales climbed 45 percent. The last of the direct brands, Mexx, only saw a 7 percent increase helped by the exchange rates (which would be a 7 percent decrease when currency changes would have been factored in). Although the Liz Claiborne better women’s line and the Claiborne men’s line performed badly, the partnered segment had highlights from the licensed DKNY Jeans Group and the Monet families of brands.

In January Claiborne hired designer Isaac Misrahi away from Target, to become the new creative director for women’s apparel, accessories and licensing in the hopes that Mizrahi’s touch would awaken Liz from the slumber of forgettable styles. Mizrahi’s first lines will be shown in September and expectations are high.

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