As we indicated in our October 24th pre-announcement, our balance sheet remains strong and we continued to drive improvements in working capital in the third quarter, as evidenced by the 24% reduction in inventory and 27% reduction in accounts receivable compared to last year, which include the impact of brands sold, discontinued, or licensed. We expect our seasonally strong fourth quarter cash flow to result in a total debt balance of $750 to $775 million at year end, a reduction of approximately $110 to $135 million in total debt from the end of last year.
For the full year 2008, we expect to generate $300 to $325 million of cash flow from continuing operating activities. We were in compliance with our bank credit facility financial covenants for the 3rd quarter and expect to be in compliance in the 4th quarter as well."
Mr. McComb continued, "We will continue our intense focus on controlling the controllables...inventory, accounts receivable, astute brand execution and generating free cash flow to pay down debt. In terms of product and brand execution, we've spent the past year developing outstanding product for this Spring--and although the environment will temper our results, we are as optimistic as we can be about how our brands will present at retail."
Mr. McComb concluded, "We are confirming our recently updated fourth quarter adjusted EPS from continuing operations guidance in the range of $0.19 to $0.24. This results in an adjusted EPS from continuing operations guidance range of $1.02 to $1.07 for the full year 2008. The current operating environment has been negatively impacted by significant declines in consumer confidence and discretionary spending. As we stated earlier, given the lack of visibility caused by the highly uncertain environment, we are not providing 2009 guidance at this point."
20240830145952.gif)
.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "UBM China (Shanghai)")
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
