US: Fifth & Pacific Q4 profit plummets on Juicy brand
- Q4 profit plummets 75% to $57m
- Sales up 8.8% to $487m
- Full-year loss narrows to $74.5m
Net income plummeted 75% to $57m in Q4
US apparel firm Fifth & Pacific has seen its fourth-quarter net profit plummet on the back of declining sales at its struggling Juicy Couture brand and costs related to discontinued operations.
The group said net income plummeted 75% to US$57m for the three months to 29 December, compared to a $229m net profit the year before.
Net sales rose 8.8% to $487m from $447.1m the year before, due to increased sales at its Kate Spade label. This was partially offset by a drop in sales at its Juicy Couture and Adelington Design Group divisions, and includes a $25m decrease in sales related to brands that have been sold or exited.
Direct-to-consumer comparable sales at its Kate Spade and Lucky brands were up 27% and 3% respectively. Juicy Couture saw sales slip 2%.
On a comparable basis, sales increased 13.8%. Gross margin improved to 55.5% against 53.8% the previous year as gross margin expansion of its Kate Spade and Lucky brands partially offset a decline at Juicy Couture.
CEO William McComb said: "2012 brought industry leading growth at Kate Spade and a significant improvement in performance at Lucky Brand. While progress in these two businesses was tempered by a miss in North America at Juicy Couture, we are optimistic that we are correcting the underlying issues at Juicy under the direction of its new CEO, Paul Blum. Our teams are all very focused on delivering their 2013 plans, as we begin the year with the right momentum."
Full-year net loss narrowed to $74.5m, compared to $171.7m the year before. Net sales edged down 0.9% to $1.50bn from the prior year. On a comparable basis, sales rose 11.6%.
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