Hartmarx Corporation (NYSE: HMX) today reported operating results for the second quarter ended May 31, 2000. Revenues were $172.5 million compared to $172.7 million in 1999. Net earnings, before an extraordinary gain, were $1.2 million, or $.04 per share, compared to a loss of $5.8 million, or $.17 per share, last year. Last year's second quarter results included a $6.9 million, net of tax, non-cash charge related to the termination of a systems project. Excluding the non-cash charge, 1999's second quarter earnings would have been $.03 per share. The extraordinary gain in the current period was $.2 million, or $.01 per share, associated with purchases of the Company's 10.875% Senior Subordinated Notes at favorable prices. Net earnings after the extraordinary gain were $1.5 million, or $.05 per share.

Elbert 0. Hand, chairman and chief executive officer of Hartmarx, commented, ``Our non-tailored clothing offerings represented about 28% of total second quarter sales and this year grew more than 9%. These products, which include casual businesswear, sportswear and womenswear, largely offset the anticipated reduction in lower-margin moderate-priced tailored clothing products. The current variable dress code environment has enhanced interest and sales of blazers, sport coats, separates and dress slacks. The increased sales contribution from higher margin products also helped to continue our progress toward our long-term goal of exceeding a 27% consolidated gross margin rate. Overall, gross margins were 27.2% of sales in the quarter, compared to 26.0% last year.

``During the second quarter, Hartmarx continued to achieve further debt reduction. As of May 31, total debt of $146.4 million was $48.5 million below the prior year. This year the Company repurchased $22.8 million of its 10.875% Senior Subordinated Notes. Book value has increased to $6.52 per share as of May 31 and for the trailing twelve months, our free cash flow was $.49 per share. We have utilized the Company's strong cash flow to repurchase about 20% of our outstanding shares and the combination of reduced shares and lower debt should be important contributors to future growth in earnings per share,'' Mr. Hand concluded.

For the six months ended May 31, revenues were $335.6 million this year compared to $349.1 million last year. Net earnings before the extraordinary gain were $2.4 million, or $.08 per share, compared to last year's loss of $4.4 million, or $.13 per share. Net earnings after the extraordinary gain were $2.6 million, or $.09 per share. Last year's net earnings excluding the non-cash charge were $2.5 million or $.07 per share.

Hartmarx produces and markets business, casual and golf apparel under its own brands including Hart Schaffner & Marx, Hickey-Freeman, Palm Beach, Coppley, Cambridge, Keithmoor, Racquet Club, Pusser's of the West Indies, Royal, Brannoch, Riserva, John Alexander, Desert Classic, Sansabelt, Barrie Pace and Hawksley & Wight and has certain exclusive rights under licensing agreements to market selected products under a number of premier brands such as Austin Reed, Tommy Hilfiger, Kenneth Cole, Burberrys men's tailored clothing, Pringle of Scotland, Bobby Jones, Jack Nicklaus, Claiborne, Evan-Picone, Pierre Cardin, Perry Ellis, KM by Krizia, and Daniel Hechter, through a broad range of channels including fine specialty and leading department stores, value-oriented retailers and direct mail catalogs.

The comments set forth above contain forward-looking statements made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The statements could be significantly impacted by such factors as the level of consumer spending for men's and women's apparel, the prevailing retail environment, the Company's relationships with its suppliers, customers, licensors and licensees, actions of competitors that may impact the Company's business and the impact of unforeseen economic changes, such as interest rates, or in other external economic and political factors over which the Company has no control. The reader is also directed to the Company's periodic filings with the Securities and Exchange Commission for additional factors that may impact the Company's results of operations and financial condition. Forward-looking statements are not guarantees as actual results could differ materially from those expressed or implied in forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Three months ended May 31, 2000 May 31, 1999 (1)

Net sales
$172,452,000
$172,680,000
Earnings (loss) before taxes and extraordinary gain
2,010,000
(9,375,000)
Tax provision (benefit)
765,000
(3,565,000)
Earnings (loss) before extraordinary gain
1,245,000
(5,810,000)
Extraordinary gain, net (2)
227,000
-----
Net earnings (loss)
1,472,000
(5,810,000)
Earnings (loss) per share (basic and diluted):
Before extraordinary gain
.04
(.17)
After extraordinary gain
.05
(.17)
Average common shares and equivalents outstanding:
Basic
29,369,000
33,675,000
Diluted
29,481,000
33,741,000


Six months ended May 31, 2000 May 31, 1999 (1)

Net sales
$335,641,000
$349,082,000
Earnings (loss) before taxes and extraordinary gain
3,820,000
(7,110,000)
Tax provision (benefit)
1,455,000
(2,705,000)
Earnings (loss) before extraordinary gain
2,365,000
(4,405,000)
Extraordinary gain, net (2)
227,000
-----
Net earnings (loss)
2,592,000
(4,405,000)
Earnings (loss) per share (basic and diluted):
Before extraordinary gain
.08
(.13)
After extraordinary gain
.09
(.13)
Average common shares and equivalents outstanding:
Basic
29,307,000
34,230,000
Diluted
29,424,000
34,286,000

(1) 1999 results included a non-cash charge of $11.2 million pre-tax, ($6.9 million or $.21 per share after-tax), reflecting a write-down of capitalized development costs related to the termination of a systems project.

(2) Extraordinary gain in 2000, net of tax provision, related to purchases of the Company's 10.875% senior subordinated debentures.