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Branded jeans sales decline at Cygne Designs
20 Sep '07
3 min read
Cygne Designs Inc announced results of operations for the second quarter and six months ended July 31, 2007.
Net sales for the second quarter of 2007 were $33.2 million, a decrease of $11.9 million, or 26.4%, from $45.1 million in the second quarter of 2007. This decrease was primarily attributable to a decrease in sales of our branded jeans due to the discontinuance of our Hippie premium brand of junior jeans and to less demand for our Hint brand of junior jeans.
Gross margins in the second quarter of 2007 increased to 23.6% compared to 22.1% in the prior year period as a result of the mix of product categories sold. The decrease in gross profit for the second quarter of 2007 compared to the second quarter of 2006 was primarily caused by a decrease in sales volume, which was offset in part by an increase in average gross margins due to the mix of products sold.
Gross margins for products produced in Mexico by Diversified Apparel, a related party, are guaranteed by product categories through a Supply Agreement; however, this guarantee of gross margins terminated as of July 31, 2007 with respect to products produced for American Eagle Outfitter and Target.
Net income for the second quarter ended July 31, 2007 was $1,581,000, or $0.06 on a basic and diluted per share basis, compared to net income of $1,990,000, or $0.08 on a basic and diluted per share basis, in the comparable prior period in 2006.
Net sales for the six months of 2007 were $54.0 million, a decrease of $12.0 million, or 18.1%, from $66.0 million in the six months of 2006. This decrease in sales was primarily attributable to a decrease in sales of our branded jeans, offset in part by sales from our acquisition of the private label division of Innovo Group Inc.
Net sales for the second quarter of 2007 were $33.2 million, a decrease of $11.9 million, or 26.4%, from $45.1 million in the second quarter of 2007. This decrease was primarily attributable to a decrease in sales of our branded jeans due to the discontinuance of our Hippie premium brand of junior jeans and to less demand for our Hint brand of junior jeans.
Gross margins in the second quarter of 2007 increased to 23.6% compared to 22.1% in the prior year period as a result of the mix of product categories sold. The decrease in gross profit for the second quarter of 2007 compared to the second quarter of 2006 was primarily caused by a decrease in sales volume, which was offset in part by an increase in average gross margins due to the mix of products sold.
Gross margins for products produced in Mexico by Diversified Apparel, a related party, are guaranteed by product categories through a Supply Agreement; however, this guarantee of gross margins terminated as of July 31, 2007 with respect to products produced for American Eagle Outfitter and Target.
Net income for the second quarter ended July 31, 2007 was $1,581,000, or $0.06 on a basic and diluted per share basis, compared to net income of $1,990,000, or $0.08 on a basic and diluted per share basis, in the comparable prior period in 2006.
Net sales for the six months of 2007 were $54.0 million, a decrease of $12.0 million, or 18.1%, from $66.0 million in the six months of 2006. This decrease in sales was primarily attributable to a decrease in sales of our branded jeans, offset in part by sales from our acquisition of the private label division of Innovo Group Inc.
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