Maxwell Shoe Company Inc, (Nasdaq: MAXS), today reported results for the fourth quarter and fiscal year ended October 31, 2000.

For the fourth quarter, net sales were $46.3m compared to $39.1m for the comparable period in the prior year, representing an increase of 18.4 per cent. Gross margin for the fourth quarter improved substantially to 24.7 per cent compared to 21.0 per cent in the prior year period. Net income for the fourth quarter increased 160.6 per cent to $3.1m, or $0.33 per diluted share, compared to net income of $1.2m, for the fourth quarter increase of 153.8 per cent or $0.13 per diluted share, during the same period last year.

For the fiscal year ended October 31, 2000, net sales were $158.2m compared to $150.3m for the comparable period in the prior year, representing an increase of 5.2 per cent. Gross margin for the twelve-month period increased to 26.1 per cent compared to 24.3 per cent in the prior year period. Net income for the twelve-month period was $9.9m, or $1.04 per diluted share, compared to net income of $18.9m, or $1.99 per diluted share, during the same period last year. It is important to note that included in the company's net income for fiscal 1999 is a one-time, after-tax gain of $11.7m, or $1.23 per diluted share, from the July 1999 sale of the company's Jones New York license. Excluding this one-time gain, net income for fiscal 1999 was $7.2m, or $0.76 per diluted share, resulting in a net income increase during fiscal 2000 of 38.2 per cent year over year.

Mark J. Cocozza, chairman and CEO of the company, said: "Our results for the fourth quarter reflect the continued broad-based strength in our business. Total sales for the fourth quarter increased 18 per cent, which was driven by strong customer reception to our lines and retail sell-through across all of our brands. Additionally, operating margin increased to 9.3 per cent versus 3.7 per cent in the prior year. As a result, earnings per share increased 153.8 per cent."

Mr Cocozza continued, "We are particularly pleased with the superior performance of our ANNE KLEIN2 business, which continues to exceed our expectations and now accounts for approximately 17 per cent of our total sales mix. Furthermore, we are delighted that during the fourth quarter we were able to acquire the highly regarded Joan & David brand. This upscale brand will provide continued diversification in our portfolio of brands."

With respect to fiscal 2001, the company has set the following targets for its financial performance: revenue in the range of $170m to $175m and net income in the range of $1.04 to $1.08 per diluted share. If the company meets its near-term financial goals, it expects to achieve sales revenue in the range of $32m to $35m and net income per diluted share of $.12 to $.14 for the first quarter ending January 31, 2001. These are the company's targets, not predictions of actual performance. Given the acquisition of Joan & David and the required investment to re-introduce the brand, in comparing the quarter to quarter to results with the prior year, the company expects the acquisition to be slightly dilutive to earnings in the third and fourth quarters.