Net income at sportswear designer Cutter & Buck Inc fell 90 per cent in the second quarter ended 31 October 2001 following the impact of events on September 11 and the difficult economy.

"After September 11, our golf business declined as consumers dramatically reduced travelling to resorts, and our corporate business was disrupted as many corporate trade shows and promotions were cancelled," said Harvey Jones, chairman & CEO. In addition, our specialty retail business was negatively impacted by the decline in consumer confidence."

During the second quarter, net income was $225,000 compared to net income of $3.1 million for the same quarter last year. Net sales decreased 6.9 per cent to $42.9 million, compared to $46.1 million for the same quarter last year, and gross margins were 39.5 per cent, compared to 44.6 per cent.

The Seattle-based company's six months year-to-date results showed net sales decreased 5.3 per cent to $80.6 million, compared to $85.1 million last year. Gross margins were 41.5 per cent, compared to 44.7 per cent, and the company recorded a net loss of $1.1 million, against a net income of $4.4 million in the same period last year.

Jones said in a statement that Cutter & Buck has re-aligned its business into new strategic units to "focus on our core businesses and core products and we have restructured our sales forces for greater results and efficiencies. At the same time, we have reduced inventory levels and cut expenses for the back half of the year."

Given the current economic uncertainty, the company expects a moderate decline in revenue in the low to middle single digit range for fiscal 2002, and a net loss per share in the range of $0.64 to $0.79 including the non-recurring charge. For fiscal 2002, the company expects earnings per share in the range of $0.01 to $0.03, excluding the non-recurring charge.