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We continue to bring fresh concepts to market, Jones CEO
01 Feb '10
4 min read
Jones Apparel Group, Inc. released its preliminary adjusted and GAAP results for fiscal year 2009. The Company expects to report 2009 full year adjusted earnings per share from continuing operations in a range of $1.11 to $1.14, compared with 2008 adjusted earnings per share from continuing operations of $0.87. For the fourth quarter of 2009, the Company expects to report adjusted earnings per share from continuing operations in a range of $0.08 to $0.11, compared with a 2008 fourth quarter adjusted loss per share from continuing operations of $(0.04).
Adjusted earnings/(loss) per share excludes the effects of impairment and restructuring charges and other items not considered part of ongoing operations (see reconciliation of adjusted earnings in the attached schedule). As reported under generally accepted accounting principles ("GAAP"), the Company expects to report a full year 2009 loss per share from continuing operations in the range of $(1.02) to $(1.05) and $(1.53) to $(1.56) for the fiscal fourth quarter. These ranges compare to a loss per share from continuing operations of $(9.05) for the full year 2008 and a loss per share of $(9.86) for the fourth quarter of 2008.
Wesley R. Card, Jones Apparel Group President and Chief Executive Officer, stated: "While we continue to note positive signs of economic recovery, we are maintaining a cautious and disciplined approach to execution as the environment remains uncertain. During the fourth quarter we were encouraged by improved results primarily from a less promotional environment throughout the holiday season. We continued to tightly control inventories, manage our costs and expenses and leverage our scale. We ended the year with cash on hand of approximately $330 million, significantly higher than our earlier expectations."
Mr. Card continued: "The year 2009 presented a unique set of challenges and we believe we are entering 2010 from a position of operational and financial strength. We have the right brands at the right price points for today's consumer, and our retail business continues to show signs of improvement. We are positioned for growth as we continue to bring innovative, fresh concepts and brands to market, such as Rachel Rachel Roy, Jones New York Collection Knits, j. Jones New York, and the recently announced Jessica Simpson Jeanswear line, which will begin shipping mid-year and is anticipated to be distributed in approximately 1,000 doors."
Non-Cash Impairment Charges
The Company has completed its required annual goodwill and trademark impairment analysis for 2009 and expects fourth quarter and full year 2009 reported results to include a pre-tax, non-cash charge of approximately $150 million ($138 million after-tax) for the impairment of certain goodwill and trademark amounts. The impairment charge is comprised of two components. Approximately $121 million ($120 million after-tax) of the non-cash charge relates to the impairment of goodwill recorded in connection with the Company's Retail business. The balance of the non-cash charge of approximately $29 million ($18 million after-tax) relates to the impairment of trademarks utilized in our Wholesale Jeanswear and Wholesale Footwear and Accessories businesses.
Adjusted earnings/(loss) per share excludes the effects of impairment and restructuring charges and other items not considered part of ongoing operations (see reconciliation of adjusted earnings in the attached schedule). As reported under generally accepted accounting principles ("GAAP"), the Company expects to report a full year 2009 loss per share from continuing operations in the range of $(1.02) to $(1.05) and $(1.53) to $(1.56) for the fiscal fourth quarter. These ranges compare to a loss per share from continuing operations of $(9.05) for the full year 2008 and a loss per share of $(9.86) for the fourth quarter of 2008.
Wesley R. Card, Jones Apparel Group President and Chief Executive Officer, stated: "While we continue to note positive signs of economic recovery, we are maintaining a cautious and disciplined approach to execution as the environment remains uncertain. During the fourth quarter we were encouraged by improved results primarily from a less promotional environment throughout the holiday season. We continued to tightly control inventories, manage our costs and expenses and leverage our scale. We ended the year with cash on hand of approximately $330 million, significantly higher than our earlier expectations."
Mr. Card continued: "The year 2009 presented a unique set of challenges and we believe we are entering 2010 from a position of operational and financial strength. We have the right brands at the right price points for today's consumer, and our retail business continues to show signs of improvement. We are positioned for growth as we continue to bring innovative, fresh concepts and brands to market, such as Rachel Rachel Roy, Jones New York Collection Knits, j. Jones New York, and the recently announced Jessica Simpson Jeanswear line, which will begin shipping mid-year and is anticipated to be distributed in approximately 1,000 doors."
Non-Cash Impairment Charges
The Company has completed its required annual goodwill and trademark impairment analysis for 2009 and expects fourth quarter and full year 2009 reported results to include a pre-tax, non-cash charge of approximately $150 million ($138 million after-tax) for the impairment of certain goodwill and trademark amounts. The impairment charge is comprised of two components. Approximately $121 million ($120 million after-tax) of the non-cash charge relates to the impairment of goodwill recorded in connection with the Company's Retail business. The balance of the non-cash charge of approximately $29 million ($18 million after-tax) relates to the impairment of trademarks utilized in our Wholesale Jeanswear and Wholesale Footwear and Accessories businesses.
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