Intimate apparel retailer Frederick's of Hollywood Group has widened its second quarter losses after writing down the value of its retail and wholesale businesses by $19.1m.

For the three months to 24 January, net loss was $20.2m or $0.77 per share, compared to a loss of $2.4m or $0.20 per share, in the same period last year.

Excluding the goodwill impairment, quarterly losses were $1.1m or $0.04 per share, the company said.

Net sales rose 24.7% to $52.5m from $42.1m last time, helped by $14.2m in wholesale revenues following the merger of Movie Star with FOH Holdings, the parent company of Frederick's of Hollywood, in January 2008.

This increase was partially offset by an 8.8% drop in retail sales to $38.4m from $42.1m.

Gross margin fell 4.9 percentage points to 34.8% of sales, down from 39.7% last time.

CEO Thomas Lynch said that since the merger, the company's domestic workforce has been cut by one-quarter, excluding store personnel, and some manufacturing support functions have been moved to the Philippines.