Selling, General & Administrative expenses ("SG&A") increased $34 million, or 8.4 percent, to $437 million, in the second quarter of 2005 over the second quarter of 2004 and as a percent of net sales was 39.8 percent, compared to 39.3 percent in the second quarter of 2004
The increased SG&A rate primarily reflected the impact of the increased proportion of expenses described above related to our domestic specialty retail and Mexx Europe businesses, which run at higher SG&A rates than the Company average, and reduced expense leverage resulting from the decreased proportion of expenses related to our domestic Liz Claiborne wholesale apparel business, which runs at a lower SG&A rate than the Company average, partially offset by Company-wide expense control initiatives.
Operating Income
Operating income for the second quarter of 2005 was $92 million (or 8.4 percent of net sales), compared to $86 million (or 8.4 percent of net sales) in the second quarter of 2004. The impact of foreign currency exchange rates, primarily as a result of the strengthening of the euro, in our international businesses added approximately $1 million in 2005. The increase in operating income primarily resulted from lower sourcing costs, partially offset by increased expenses associated with the expansion of our domestic and international retail businesses, the additional liquidation of excess inventory and continued investment in building a multi-brand platform in Europe
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.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "UBM China (Shanghai)")
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
