Core outerwear inventory at G-III Apparel higher than last year
G-III Apparel Group Ltd announced operating results for the fourth quarter and full-year of fiscal 2009.
For the fiscal year ended January 31, 2009, G-III reported net sales increased by 37.1% to $711.1 million from $518.9 million last year. The Company recorded non-cash charges for the impairment of goodwill and trademarks during the fourth quarter of $33.5 million on a pre-tax basis, equal to $1.69 per share on an after-tax basis. As a result, we reported a net loss per share on a GAAP basis of $0.85 compared to net income per diluted share of $1.05 last year. These non-cash charges do not impact the Company's business operations, cash flows or compliance with the financial covenants in its credit agreement.
Adjusted net income per diluted share for the year, excluding these impairment charges, was $0.84 compared to adjusted net income per diluted share of $1.14 in the prior year. Prior year adjusted net income excludes the effects of three different non-recurring items: (i) a $3.0 million pre-tax charge in cost of sales, equal to $0.11 per diluted share on an after-tax basis, to reflect losses with respect to vendor financing that the Company guaranteed; (ii) a $720,000 pre-tax charge in cost of sales, equal to $0.03 per diluted share on an after-tax basis, related to the termination of a license agreement; and (iii) a pre-tax gain of $860,000, included in selling general and administrative costs , equal to $0.05 per diluted share on an after-tax basis, related to the reversal of an accrued expense reserve which was originally recorded in connection with the close down of our Indonesian facility.
For the three-month period ended January 31, 2009, G-III reported that net sales increased by 32.6% to $170.7 million from $128.7 million during the comparable period last year. Net loss per share on a GAAP basis was $1.93 compared to net income per diluted share of $0.06 for the comparable period last year.
Excluding the non-cash charge for the impairment of goodwill and trademarks during the fourth quarter, the adjusted net loss per share for the quarter was $0.23 compared to adjusted net income per diluted share of $0.15 during the comparable period last year, which excludes the effect of the prior year non-recurring items described above.
For the fiscal year ended January 31, 2009, EBITDA decreased 3.2% to $36.6 million from $37.8 million in the prior fiscal year. EBITDA should be evaluated in light of the Company's financial results prepared in accordance with GAAP. A reconciliation of EBITDA to net income in accordance with GAAP is included in a table accompanying the condensed financial statements in this release.
The Company reduced its seasonal bank debt outstanding as of the end of the third quarter in line with its plan. Bank debt was reduced by $142 million, leaving $29 million outstanding at January 31, 2009. Inventory at the close of the fiscal year was approximately $117 million compared to the year-ago level of $60 million. The Company noted that of the $57 million increase, an aggregate of $34 million related to inventory for the Wilsons retail outlet business acquired in July 2008 and the Andrew Marc business acquired in February 2008.