Liz Claiborne Direct Brands segment sales up in Q4
14 Mar '08
3 min read
Actual and projected performance and cash flows in this segment, as well as the impact of the sale or planned sale, licensing or closure of the brands under strategic review, no longer supported this goodwill balance.
The full year and fourth quarter 2007 results on an adjusted basis exclude the impact of expenses incurred in connection with the Company's previously announced plans to streamline its operations in 2007, non-cash charges associated with goodwill and trademark impairment in its Partnered Brands segment, expenses associated with the elimination of certain cosmetics product offerings, and the loss related to the disposition of certain previously announced brands under review, but includes the results of discontinued operations.
The full year and fourth quarter 2006 results on an adjusted basis exclude the impact of expenses incurred in connection with the Company's streamlining activities.
The Company believes that the adjusted results for the fourth quarter and full year 2007 and 2006 and the adjusted projected results for fiscal 2008 represent a more meaningful presentation of its historical and estimated operations and financial performance since these results provide period to period comparisons that are consistent and more easily understood. The attached tables, captioned "Reconciliation of Non-GAAP Financial Information", provide a full reconciliation of actual results to the adjusted results.
William L. McComb, Chief Executive Officer of Liz Claiborne Inc, said: "The adjusted earnings and cash flow we are reporting today are consistent with our February 14th pre-announcement. At that time, we indicated the need to complete a goodwill and trademark impairment review which resulted in a pre-tax, non-cash goodwill impairment charge of $451 million in our Partnered Brands segment.
This charge did not impact our cash flow or liquidity, which remain strong, with fiscal 2007 positive cash flow from operating activities of $274 million. We are projecting cash flow from operating activities to approximate $350 million in fiscal 2008."