Liz Claiborne Inc. (LIZ, Financial) filed Quarterly Report for the period ended 2010-10-02.
Liz Claiborne Inc. has a market cap of $581.5 million; its shares were traded at around $6.23 with and P/S ratio of 0.2. LIZ is in the portfolios of Richard Perry of Perry Capital, Arnold Schneider of Schneider Capital Management, Chuck Royce of Royce& Associates, George Soros of Soros Fund Management LLC.
Gross profit in the first nine months of 2010 was $902.1 million, a decrease of $110.2 million compared to the first nine months of 2009, primarily due to reduced sales in our Partnered Brands and International-Based Direct Brands segments, partially offset by an increase in gross profit in our Domestic-Based Direct Brands segment. Gross profit as a percentage of net sales increased to 49.1% in 2010 from 45.8% in 2009, reflecting improved gross profit rates in all of our segments and an increased proportion of sales from the retail operations of our Domestic-Based Direct Brands segment, which runs at a higher gross profit rate than the company average. We recorded a loss from continuing operations of $212.2 million in the first nine months of 2010, as compared to a loss from continuing operations of $249.0 million in 2009. The reduced loss from continuing operations primarily reflected the impact of a reduction in Selling, general & administrative expenses (SG&A) and an increase in Other income (expense), primarily due to a period-over-period increase of $22.0 million in foreign currency translation gains related to our euro Notes (see Financial Position, Liquidity and Capital Resources Hedging Activities), partially offset by the impact of decreased gross profits.
We ended the first nine months of 2010 with a net debt position of $719.9 million as compared to $803.0 million at the end of the first nine months of 2009. Including the receipt of $172.4 million of net income tax refunds, we generated $159.9 million in cash from continuing operations over the past twelve months, which enabled us to fund $61.9 million of capital and in-store shop expenditures, a $24.3 million refund paid to Li & Fung Limited (Li & Fung) related to a buying/sourcing arrangement, $11.3 million of investments in and advances to Kate Spade Japan Co. Ltd. (KSJ), an equity method investee and $5.0 million of acquisition related payments, while decreasing our net debt by $83.1 million. The effect of foreign currency translation on our euro Notes decreased our debt balance by $28.7 million at October 2, 2010 compared to October 3, 2009.
Net Sales Net sales for the first nine months of 2010 were $1.836 billion, a decrease of $374.0 million, or 16.9%, when compared to the first nine months of 2009. This reduction primarily reflected sales declines in our Partnered Brands and International-Based Direct Brands segments. The decrease in our Partnered Brands segment included a $167.4 million decrease in our LIZ CLAIBORNE family of brands as we transitioned to the licensing model under the JCPenney and QVC arrangements. The impact of changes in foreign currency exchange rates in our international businesses increased net sales by $1.4 million in the first nine months of 2010. The decrease in net sales also
Viewed on a geographic basis, Domestic net sales decreased by $284.0 million, or 19.0%, to $1.207 billion, primarily reflecting the declines within our Partnered Brands segment, JUICY COUTURE wholesale operations and LUCKY BRAND retail and wholesale operations, partially offset by an increase in our KATE SPADE retail and wholesale operations and JUICY COUTURE retail operations. International net sales decreased by $90.2 million, or 12.5%, to $629.0 million, primarily due to declines in our MEXX Europe wholesale and retail operations, partially offset by an increase in our MEXX Canada retail operations. The impact of fluctuations in foreign currency exchange rates increased international sales by $1.4 million.
Gross Profit Gross profit in the first nine months of 2010 was $902.1 million (49.1% of net sales), compared to $1.012 billion (45.8% of net sales) in the first nine months of 2009. The decrease in gross profit is primarily due to reduced sales in all of our segments. Fluctuations in foreign currency exchange rates in our international businesses increased gross profit by $0.8 million. However, our gross profit rate increased due to an increased proportion of sales from retail operations in our Domestic-Based Direct Brands segment, which runs at a higher gross profit rate than the Company average. Gross profit rates improved in our Domestic-Based Direct Brands segment, despite reduced average selling
Read the The complete Report
Liz Claiborne Inc. has a market cap of $581.5 million; its shares were traded at around $6.23 with and P/S ratio of 0.2. LIZ is in the portfolios of Richard Perry of Perry Capital, Arnold Schneider of Schneider Capital Management, Chuck Royce of Royce& Associates, George Soros of Soros Fund Management LLC.
Highlight of Business Operations:
In May 2010, we completed a second amendment to and restatement of our revolving credit facility (as amended, the Amended Agreement). Under the Amended Agreement, the aggregate commitments were reduced to $350.0 million from $600.0 million, and the maturity date was extended from May 2011 to August 2014, subject to certain early termination provisions which provide for earlier maturity dates if our 5.0% 350.0 million euro Notes due July 2013 (the Notes) and our 6.0% Convertible Senior Notes due June 2014 (the Convertible Notes) are not repaid or refinanced by certain agreed upon dates. We are subject to various covenants and other requirements, such as financial requirements, reporting requirements and negative covenants. Pursuant to the May 2010 amendment, we are required to maintain minimum aggregate borrowing availability of not less than $45.0 million and must apply substantially all cash collections to reduce outstanding borrowings under the Amended Agreement when availability under the Amended Agreement falls below the greater of $65.0 million and 17.5% of the then-applicable aggregate commitments. Our borrowing availability under the Amended Agreement is determined primarily by the level of our eligible accounts receivable and inventory balances. In addition, the Amended Agreement removes the springing fixed charge coverage covenant that was a condition of the prior amended and restated revolving credit agreement.Gross profit in the first nine months of 2010 was $902.1 million, a decrease of $110.2 million compared to the first nine months of 2009, primarily due to reduced sales in our Partnered Brands and International-Based Direct Brands segments, partially offset by an increase in gross profit in our Domestic-Based Direct Brands segment. Gross profit as a percentage of net sales increased to 49.1% in 2010 from 45.8% in 2009, reflecting improved gross profit rates in all of our segments and an increased proportion of sales from the retail operations of our Domestic-Based Direct Brands segment, which runs at a higher gross profit rate than the company average. We recorded a loss from continuing operations of $212.2 million in the first nine months of 2010, as compared to a loss from continuing operations of $249.0 million in 2009. The reduced loss from continuing operations primarily reflected the impact of a reduction in Selling, general & administrative expenses (SG&A) and an increase in Other income (expense), primarily due to a period-over-period increase of $22.0 million in foreign currency translation gains related to our euro Notes (see Financial Position, Liquidity and Capital Resources Hedging Activities), partially offset by the impact of decreased gross profits.
We ended the first nine months of 2010 with a net debt position of $719.9 million as compared to $803.0 million at the end of the first nine months of 2009. Including the receipt of $172.4 million of net income tax refunds, we generated $159.9 million in cash from continuing operations over the past twelve months, which enabled us to fund $61.9 million of capital and in-store shop expenditures, a $24.3 million refund paid to Li & Fung Limited (Li & Fung) related to a buying/sourcing arrangement, $11.3 million of investments in and advances to Kate Spade Japan Co. Ltd. (KSJ), an equity method investee and $5.0 million of acquisition related payments, while decreasing our net debt by $83.1 million. The effect of foreign currency translation on our euro Notes decreased our debt balance by $28.7 million at October 2, 2010 compared to October 3, 2009.
Net Sales Net sales for the first nine months of 2010 were $1.836 billion, a decrease of $374.0 million, or 16.9%, when compared to the first nine months of 2009. This reduction primarily reflected sales declines in our Partnered Brands and International-Based Direct Brands segments. The decrease in our Partnered Brands segment included a $167.4 million decrease in our LIZ CLAIBORNE family of brands as we transitioned to the licensing model under the JCPenney and QVC arrangements. The impact of changes in foreign currency exchange rates in our international businesses increased net sales by $1.4 million in the first nine months of 2010. The decrease in net sales also
Viewed on a geographic basis, Domestic net sales decreased by $284.0 million, or 19.0%, to $1.207 billion, primarily reflecting the declines within our Partnered Brands segment, JUICY COUTURE wholesale operations and LUCKY BRAND retail and wholesale operations, partially offset by an increase in our KATE SPADE retail and wholesale operations and JUICY COUTURE retail operations. International net sales decreased by $90.2 million, or 12.5%, to $629.0 million, primarily due to declines in our MEXX Europe wholesale and retail operations, partially offset by an increase in our MEXX Canada retail operations. The impact of fluctuations in foreign currency exchange rates increased international sales by $1.4 million.
Gross Profit Gross profit in the first nine months of 2010 was $902.1 million (49.1% of net sales), compared to $1.012 billion (45.8% of net sales) in the first nine months of 2009. The decrease in gross profit is primarily due to reduced sales in all of our segments. Fluctuations in foreign currency exchange rates in our international businesses increased gross profit by $0.8 million. However, our gross profit rate increased due to an increased proportion of sales from retail operations in our Domestic-Based Direct Brands segment, which runs at a higher gross profit rate than the Company average. Gross profit rates improved in our Domestic-Based Direct Brands segment, despite reduced average selling
Read the The complete Report
