Canadian apparel manufacturer and imported The Algo Group yesterday reported a net loss for the second quarter ended June 30, 2001 of $3.5 million compared with a net loss of $2.0 million in the previous year. Six month losses were $3.8 million, up from the $2.8 million loss in 2000.

Sales for the second quarter and six-month periods were $17.0 million and $44.0 million respectively, compared with $21.9 million and $53.0 million for the previous year.

Algo Group president and CEO, Raoul Heredia, said in a statement the decline in sales was primarily in the ladies' fashion and sportswear business units as lower spring reorders in Canada and the US affected this sector.

"In addition, the planned re-launch of the MUDD line in our sportswear division did not occur until the current quarter, resulting in lower comparative sales in the second quarter. There was also a clear-out of prior seasons' stock in Bugle Boy, culminating from the discontinuance of certain categories. This negatively impacted gross margins."

Mr Heredia added that retail market conditions in Canada and the US remain soft. "We expect this trend will continue into the next year. Our approach is to look for new brands to add to our product lines and attract market share in buying dollars. We expect that the MUDD jeans for girls will continue to grow. The Victor Costa line of ladies' eveningwear has been added to the company's New York showroom for fall 2001. The BCBG Max Azria and To The Max! lines will make positive contributions to the business."