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Private label business sales boost Tarrant annual income

27
Mar '08

Tarrant Apparel Group, a design and sourcing company for private label and private brand casual apparel, announced financial results for the three months and year ended December 31, 2007.

Results for the Quarter Ended December 31, 2007:
The Company reported net sales of $57.3 million in the fourth quarter of 2007, a slight decrease compared to $57.4 million in the same period in 2006. Private Brands sales were $12.8 million in the 2007 quarter, a 6.2% increase compared to $12.0 million in the fourth quarter of 2006, with the increase primarily attributable to an $1.1 million increase in sales of our American Rag CIE brand. Private Label sales decreased 1.9% in the 2007 fourth quarter to $44.5 million, as compared to $45.4 million reported in the same period last year.

Gross profit for the fourth quarter of 2007 was $11.1 million, a 19.1% decrease compared to $13.7 million in the fourth quarter of 2007. As a percentage of net sales, gross profit declined from 23.8% in the fourth quarter of 2006 to 19.3% in the fourth quarter of 2007.

The decrease in gross profit in 2007 was due primarily to lower sub-license income and a general decrease in gross margins Selling, general, and administrative expenses for the fourth quarter of 2007 were $9.7 million compared to $9.7 million in the 2006 fourth quarter. As a percentage of net sales, selling, general and administrative expenses decreased to 16.8% versus 16.9% for the same period of the prior year.

Loss from operations was $61,000 in the fourth quarter of 2007 compared to income from operations of $3.3 million in the fourth quarter of 2006. This loss was caused by the lower gross profit and $0.8 million adjustment to the fair value of a long-term receivable-related party.

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