Liz Claiborne reports Q1 results
Liz Claiborne Inc announced earnings for the first quarter of 2011. For the first quarter of 2011 on a GAAP basis, the loss from continuing operations was ($84) million, or ($0.88) per share, compared to a loss from continuing operations of ($56) million, or ($0.59) per share, for the first quarter of 2010.
Adjusted loss per share from continuing operations for the first quarter was ($0.56), compared to an adjusted loss per share from continuing operations of ($0.32) for the first quarter of 2010 (inclusive of losses of ($0.15) per share in the first quarter of 2011 and gains of $0.15 per share in the first quarter of 2010, primarily resulting from the impact of changes in foreign currency exchange rates on our eurobond). Adjusted EBITDA, excluding foreign currency gains (losses), net, for the first quarter of 2011 was ($13) million, compared to ($12) million for the first quarter of 2010.
Net sales for the first quarter were $513 million, a decrease of $71 million, or 12.2%, from the comparable 2010 period. Excluding the impact of a $58 million decrease in net sales of brands that have been licensed or exited, substantially all of which was associated with the transition of the Liz Claiborne family of brands to the licensing models under the JCPenney and QVC arrangements, net sales decreased $13 million, or 2.2%, primarily due to decreased sales in our International-Based Direct Brands segment.
William L. McComb, Chief Executive Officer of Liz Claiborne Inc., said: "Adjusted EBITDA,excluding foreign currency transaction losses, of ($13) million in the first quarter was in line with the outlook we provided in March. Based upon our latest forecast, we are reaffirming our guidance for Adjusted EBITDA,excluding foreign currency transaction gains or losses, in the range of $100 to $120 million for fiscal 2011 and $180 to $220 million for fiscal 2012. We also continued our focus on strengthening our capital structure, as evidenced by the successful completion of our recent eurobond tender and the issuance of new $220 million, 8 year notes in April."
Mr. McComb concluded, "Direct to consumer comparable sales for March and estimated month to date comparable sales for April reflect both the impact of the Easter shift as well as the current trend in our businesses. At kate spade, we continue to see exceptional performance across all product categories, channels and geographies. Lucky Brand is now gaining momentum across the store, benefiting from strong sell throughs of their spring assortments. As we forecast on the last call, Juicy Couture's performance was challenging in the quarter.
“We are excited about improvements in product already in the pipeline, driven by Leann Nealz and her team, and look forward to a positive impact on the business by Holiday. At Mexx Europe, we are encouraged by the progress to date in rebuilding the wholesale business and will continue our focus on improving profitability in thedirect to consumer channel. In Partnered Brands, we are on track to generate positive adjusted operating income for the year. We look forward to showcasing these brands and their management teams tomorrow at our investor day conference."
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Liz Claiborne Inc