Liz will speed the roll out of Juicy Couture globally

21 Feb '11

4 min read

Liz Claiborne Inc announced earnings for the fourth quarter of 2010. For the fourth quarter of 2010 on a GAAP basis, the loss per share from continuing operations was ($0.24) compared to a loss per share from continuing operations of ($0.39) for the fourth quarter of 2009.

Adjusted loss per share from continuing operations for the fourth quarter was ($0.03), compared to an adjusted loss per share from continuing operations of ($0.15) for the fourth quarter of 2009 (inclusive of income of $0.10 per share in the fourth quarter of 2010 and $0.03 in the fourth quarter of 2009, primarily resulting from the impact of changes in foreign currency exchange rates on our eurobond).

Net sales for the fourth quarter were $704 million, a decrease of $53 million, or 7.0%, from the comparable 2009 period. Excluding the impact of a $61 million decrease in net sales of the Liz Claiborne family of brands resulting from the transition to the licensing models under the JCPenney and QVC arrangements, net sales increased $8 million, or 1.1%, primarily due to increased sales in our Domestic-Based Direct Brands segment.

For the full year 2010, the Company recorded a loss from continuing operations of ($220) million, or ($2.34) per share, compared to a loss from continuing operations for the full year 2009 of ($278) million, or ($2.96) per share. Adjusted loss per share from continuing operations in the full year 2010 was ($0.78) compared to an adjusted loss per share from continuing operations of ($1.37) in the full year 2009 (inclusive of income (loss) of $0.17 per share in the full year 2010 and ($0.06) per share in the full year 2009, primarily resulting from the impact of changes in foreign currency exchange rates on our eurobond).

Net sales for the full year 2010 were approximately $2.500 billion, a decrease of $416 million, or 14.3%, from the comparable 2009 period. Excluding the impact of a $228 million decrease in net sales of the Liz Claiborne family of brands resulting from the transition to the licensing models under the JCPenney and QVC arrangements, net sales decreased $188 million, or 6.5%.

William L. McComb, Chief Executive Officer of Liz Claiborne Inc., said: "Our operating results in the fourth quarter were consistent overall with the outlook we provided on our January 6th pre-announcement. Net sales, gross margin, SG&A and operating loss for the fourth quarters were in line or slightly better than the estimates provided. Despite the challenging results of the fourth quarter, our balance sheet and cash flow positions remain quite strong at year-end. We ended the year with total debt of $578 million, an $80 million decrease compared to year-end 2009. Cash flow was strong in the fourth quarter, resulting in bank debt of $23 million at year-end, and availability of $240 million under our bank credit facility."

Mr. McComb concluded, "For fiscal 2011, we are targeting adjusted EBITDA in the range of $100 million to $120 million, compared to adjusted EBITDA of $50 million in 2010. This reflects the current view of our businesses, as we continue to work through the turnarounds at Mexx Europe and Lucky Brand, speed the roll out of Juicy Couture globally while re-energizing the domestic business, and continue to drive profitable growth at kate spade and with our licensed Liz Claiborne brand at JCPenney.”

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