US: Perry Ellis exiting men’s specialty store business
Speaking in a conference call with investors last week, vice chairman, president and COO Oscar Feldenkreis said the savings will be seen from fiscal 2010.
The changes follow a review of underperforming brands and businesses announced by the Miami-based firm last November.
At the time it said the review would include its men's specialty store business for all brands, real estate realignment, Perry Ellis retail, distribution costs, and shared services.
Talking to investors, Feldenkreis said the decision to exit the men's specialty store business was "primarily because of lack of credit in the market to insure the receivables of smaller stores.
"This has significantly reduced our overhead in sales, design, and marketing and merchandising, plus back-end service."
He also said the outerwear Dockers license "didn't achieve the financial thresholds we established when we acquired it."
However, the company says it remains committed to its Axis and Tricots St Raphael luxury brands sold in the luxury and department store channel, as well as regional retailers.
Updating the situation in a statement, Feldenkreis noted: "The fact that we are exiting smaller retailers with credit issues and consequently reducing our cost structure does not reflect in any way that we will stop serving larger retailers."
Axis and Tricots St. Raphael spring collections are currently available in over 300 doors including Sak's Fifth Avenue, Von Maur, Bloomingdale's and Nordstrom.
The changes were revealed as the company said it swung to a fourth quarter loss after writing down the value of some of its brands and taking higher markdowns at department and specialty stores.
The firm, whose brands include Laundry, Shelli Segal and C&C California, reported a net loss of $21.6m, for the three months to 31 January, down from a profit of $9.9m a year earlier.
Charges included $22.3m to reduce the value of some of its trademarks, while sales fell 10% to $191.2m from $212.3m.
Separately, Perry Ellis said it has signed a new licensing deal with Callaway Golf - but will let its license for the Ping golf brand expire at the end of this year.
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