Cygne Designs branded jeans sales down in Q3

24 Dec '07

3 min read

Net sales for the nine months of 2007 were $77.0 million, a decrease of $22.0 million, or 22.3%, from $99.0 million in the nine months ended October 31, 2006. This decrease in sales was primarily attributable to a decrease in sales of our branded jeans.

Gross profit for the nine months of 2007 was $16.2 million, a decrease of $5.1 million from the gross profit of $21.3 million for the nine months of 2006. Gross margins decreased to 21.0% compared to 21.5% in the prior year period as a result of the mix of product categories sold.

As discussed above, gross margins on certain of our products was guaranteed in both periods. The decrease in gross profit for the nine months of 2007 compared to the nine months of 2006 was primarily caused by a decrease in sales volume.

Net income for the nine months ended October 31, 2007 was $916,000, or $0.03 on a basic and diluted per share basis, compared to a net income of $1,779,000, or $0.07 on a basic and diluted per share basis, in the comparable prior period in 2006. Net income was positively affected by the $2.2 million gain on extinguishment of debt referred to above.

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