• Fourth-quarter loss of $3m
  • Fourth-quarter sales increased 5% to $124.5m
  • Full-year net income down 26.7% to $22.8m
  • Sales rose 8.9% to $606.3m

Maidenform has swung to a fourth-quarter loss as margins were hit by product discontinuations and other costs.

For the quarter ended 31 December, the lingerie company recorded a US$3m loss, against a $6.7m profit in the same period of the previous year.

Gross margin fell 23.5% against 35% a year ago, which it attributed to the discontinuation of a product line and inventory related clearing costs. SG&A costs rose 14% to $34.1m, due to 25 redundancies, new hires, rising distribution costs and increased retail operating expenses.

Sales increased 5% over the quarter to $124.5m, with wholesale net sales increasing 4.4% to $109.8m. Retail segment sales were up 9.7% to $14.7m, with same-store sales rising 7.2%.

Full-year net income was down 26.7% to $22.8m. Sales increased 8.9% to $606.3m, thanks to growth across all channels. Wholesale sales rose 9.1% to $545.8m as retail sales climbed 7.3% to $60.5m. Same-store sales were up 4%, driven by growth in the shapewear and panties categories.

The company is forecasting that first-quarter sales will be down on the previous year to $150-155m against the $163.6m recorded in 2011.

For the full-year, it expects sales growth of 1.5-3.5% over 2011. It also expects EPS in a range of $1.75-1.85 per share.

"We achieved solid top line results in total for the third year in a row, with strength across our major strategic priorities, including shapewear, international, mass merchants, Donna Karan International and direct to consumer," said CEO Maurice Reznik.

"Near term gross margin pressures yielded depressed results for 2011 overall. We have taken actions to address these issues, including cost reductions and improvements to our supply chain that we expect will yield meaningful acceleration in margins and profits, particularly in the back half of 2012 and beyond." 

The company's share price closed yesterday (8 March) up 2.53% to $21.08 a share.