News Flash

Warnaco Group releases selected preliminary results

11 Jan '06

3 min read

'Although these preliminary results demonstrate improvement over the prior year, they are nonetheless disappointed that they did not reach all of their financial goals for 2005,' said Joe Gromek, Warnaco's President and Chief Executive Officer.

'They expect to end the year with a strong balance sheet. Cash and cash equivalents should approximate $150 million and they believe inventories at year end will be below last year's levels.

Moreover, their brands are performing to their expectations at retail, and they are enthusiastic about their new fall introductions, including Perfectly Fit and 365 from Calvin Klein underwear.

They also believe that actions taken throughout fiscal 2005, including further diversification of their distribution channels and development of their in-house global sourcing team, have set the foundation for future success.'

Gromek continued, 'Looking forward to 2006, for their existing businesses, they would anticipate

(i) revenue growth similar to 2005,

(ii) a gross margin increase of at least 100 basis points, and

(iii) double-digit growth in their operating margin percentage (assuming minimal pension expense in 2006).'

Gromek concluded, 'They expect that their agreement to acquire the Calvin Klein jeans and certain related businesses in Europe and Asia will build on their existing foundation and accelerate growth.

Assuming the acquisition closes on January 31, 2006, they would then expect

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