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News Flash
FOH records a net loss of $0.08 per diluted share
11 Jun '08
4 min read
The gross margin for the Movie Star wholesale division for the three-month period was 28.4%. In addition, included in selling, general and administrative expenses for the three and nine months ended April 26, 2008 were one-time non-recurring merger related expenses that totaled $1,651,000 and $2,241,000, respectively.
These consisted of stock compensation expense, audit fees in excess of normal audit costs, bonuses and insurance policies purchased as a requirement of the merger.
Peter Cole, Executive Chairman of the Company, stated, "As our business is dependent upon consumer demand for our products, the weakened U.S. economy and the resulting decline in consumer discretionary spending since late 2007 has negatively affected our operating results.
In particular, our retail store sales have been impacted by reduced mall traffic brought on by high gasoline prices and our wholesale division has experienced additional margin pressure.
While economic conditions have also contributed to a decline in retail Internet sales, the decreases that we have experienced in this area have been primarily due to an unsuccessful transition to a new web platform. We are currently reviewing alternatives to replace and improve our legacy Internet platform, which we believe we will be able to implement during fiscal 2009."
Mr. Cole continued, "While the macroeconomic environment continues to pose challenges to both our wholesale and retail channels, we have taken a number of actions following the consummation of the merger to reduce operating expenses.
We expect that the positive impact of these cost-reduction measures, coupled with the operating cost savings and other synergies realized in the merger, will become apparent in future reporting periods.
We are confident that we are building a company that will be a prominent player in the intimate apparel business for many years to come. I look forward to reporting to you on our future results."
These consisted of stock compensation expense, audit fees in excess of normal audit costs, bonuses and insurance policies purchased as a requirement of the merger.
Peter Cole, Executive Chairman of the Company, stated, "As our business is dependent upon consumer demand for our products, the weakened U.S. economy and the resulting decline in consumer discretionary spending since late 2007 has negatively affected our operating results.
In particular, our retail store sales have been impacted by reduced mall traffic brought on by high gasoline prices and our wholesale division has experienced additional margin pressure.
While economic conditions have also contributed to a decline in retail Internet sales, the decreases that we have experienced in this area have been primarily due to an unsuccessful transition to a new web platform. We are currently reviewing alternatives to replace and improve our legacy Internet platform, which we believe we will be able to implement during fiscal 2009."
Mr. Cole continued, "While the macroeconomic environment continues to pose challenges to both our wholesale and retail channels, we have taken a number of actions following the consummation of the merger to reduce operating expenses.
We expect that the positive impact of these cost-reduction measures, coupled with the operating cost savings and other synergies realized in the merger, will become apparent in future reporting periods.
We are confident that we are building a company that will be a prominent player in the intimate apparel business for many years to come. I look forward to reporting to you on our future results."
Frederick's of Hollywood Group Inc
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