Revenue decreases 5.5% at Perry Ellis in H1 FY'12

Net income for the first half of fiscal 2013 was $7.2 million, or $0.47 per fully diluted share, compared to $17.2 million, or $1.08 per fully diluted share in the first half of fiscal 2012.

After considering the costs associated with the exit of underperforming brands and businesses, the voluntary retirement program, the closing of the sourcing office and the relocation of the third party logistics provider, earnings per fully diluted share, as adjusted, for the first half of fiscal 2013 was $0.70 compared to earnings per fully diluted share, as adjusted, of $1.16 in the first half of fiscal 2012. For the first half of fiscal 2012, EPS, per fully diluted share, as adjusted, excludes costs related to the impact of early extinguishment of debt and duplicate interest expense.

Balance Sheet Update

George Feldenkreis, Chairman and CEO of Perry Ellis International commented, “We believe that our excellent financial position and the strength of our operating platform provide us with the foundation to capitalize on our improved sportswear offering and maximize sales opportunities across multiple distribution channels around the globe. We are confident that the focus and disciplined management of our balance sheet will provide support for continued growth in our core competencies.”

The Company ended the quarter with $82 million in cash and cash equivalents and full availability under its senior credit facility. Inventories at quarter end totaled $164.7 million, a reduction of $44.4 million or 21% compared to $209.1 million as of July 30, 2011. As a result of the disciplined management of inventory, the Company ended the period with a net debt to total capitalization of approximately 20% as compared to 27% for the comparable prior year period.

Fiscal 2013 Guidance

The Company remains comfortable with revenue guidance ranging from $990 million to $1 billion for full fiscal year 2013.

The Company has updated its outlook for the full fiscal year expecting diluted EPS as adjusted in a range of $1.75 to $1.80. This updated guidance principally reflects the impact for the transition to service the new distribution channels in the expanded Callaway agreement, and to a lesser extent continued promotional activity in its collection businesses into the fall season.

The Company has a positive outlook as it transitions from a service fee model with Callaway to a direct sales model. Assuming the new channels of distribution positions the Company for continued growth in the future and it expects for the transition to be a positive earnings contributor beginning in spring 2013.

Perry Ellis International, Inc. is a leading designer, distributor and licensor of a broad line of high quality men's and women's apparel, accessories and fragrances, as well as select children's apparel.

Perry Ellis International Inc