Control It, shapewear brand performs well at Maidenform

May 07, 2008 - United States Of America

Maidenform Brands Inc, a global branded marketer of intimate apparel, announced financial results for the first quarter ended March 29, 2008.

As stated in Maidenform's fourth quarter and full year 2007 press release on March 5, 2008, the Company projected lower net sales results for the first quarter of 2008 compared to the prior year from a non-recurring private brand program with a specialty retailer and a more challenging retail environment overall.

First quarter 2008 highlights versus first quarter 2007:
• Mass merchant channel net sales increased 5.9% to $30.3 million.
• Retail segment net sales increased 12.7% to $11.5 million. Same store sales increased 9.4%.
• International sales increased 11.1% to $8.0 million.
• Consolidated gross margins increased 240 basis points to 38.7%.

Thomas J. Ward, Chief Executive Officer, stated, "While we experienced a more challenging first quarter with consolidated net sales down 8.5%, our team remains focused on driving performance and positioning the Company for long-term success.

In the first quarter of 2008, we continued to build a platform for growth through solid performance in our mass channel business from expanding assortments and doors with certain customers, intensifying our footprint internationally particularly in Germany, enhancing store productivity in our retail outlet stores and implementing cost-saving sourcing initiatives that resulted in continued consolidated gross margin expansion.

For the full year of 2008, we reiterate our double-digit EPS projection of 10% from our current business driven by Maidenform specific initiatives occurring in the second half of the year including new brand launches with new and existing customers, adding programs with certain current customers as well as expanding our door presence.

As we navigate through a difficult retail climate, we captured these performance enhancing opportunities in 2008 through product differentiation, innovative contributions to the marketplace and value contribution to customers."

Financial Results for First Quarter 2008 versus First Quarter 2007:
Consistent with Maidenform's previously stated projection of lower net sales for the first quarter of 2008, net sales for the first quarter of 2008 decreased $9.1 million, or 8.5%, to $98.1 million. Wholesale segment net sales in the first quarter of 2008 decreased $10.4 million, or 10.7%, to $86.6 million with wholesale branded net sales down 3.5%.

Total international net sales, which are included in the wholesale segment, increased $0.8 million, or 11.1%, to $8.0 million. Retail segment net sales increased $1.3 million, or 12.7%, to $11.5 million in the first quarter of 2008.

Wholesale Segment:
Department Stores and National Chain Stores:
Net sales for the Department Stores and National Chain Stores channel decreased $5.1 million, or 9.5%, to $48.4 million in the first quarter of 2008 primarily asa result of fewer sales from national chain store customers.

Despite a more challenging retail climate, Maidenform had solid performance from certain key brand and product initiatives such as (1) an expanded door presence of Maidenform's shapewear brand Control It; (2) continued growth in the Company's full-figure Lilyette brand, including the introduction of the Aircurves Air Pad Push-Up; and (3) strength in the Flexees business which included the launch of a new category of innerwear/outerwear named Shapewear Chic.

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