Apparel giant Nautica Enterprises Inc on Thursday revealed it swung to a fourth quarter profit as solid sales of jeans, children's clothing and sleepwear offset a hefty charge related to the restructuring of its European unit.

The New York-based company, whose brands include Earl Jean and John Varvatos, posted a net profit of $5.6 million, or 16 cents per share, for the quarter to March 1 versus a loss of $8.4m, or 25 cents per share, in the year prior.

Net sales increased 14 per cent to $178.5m from $156.6m while excluding a $6m to $7m charge for the axing of its European operations, its quarterly operating profit hit $7.2m, or 21 cents per share, from $591,000, or two cents per share, in 2002.

The company said in news release it expects its consolidation initiative and relocation of Earl Jean to New York and Virginia from Los Angeles to add about one to two cents to net earnings annually beginning in fiscal 2005.

For the full year, net sales were flat at $693.7m while net profit, adjusted for special charges, was $30.9m, or 90 cents per share, compared to an adjusted net profit of $26.2m or 76 cents per share, in the prior year period.

Last month, the firm said it will close its offices in Europe and move its European business to licensing or other arrangements as its European business now amounts to under two per cent of its total net sales.

Chairman, president and CEO, Harvey Sanders, commented: "We are pleased to report that our earnings performance for the fourth quarter and full year were in line with analysts' consensus estimates.

"We experienced stronger than originally anticipated selling in some of our divisions which enabled us to post a double-digit sales increase for the quarter.

"Driving this performance was Earl Jean, Nautica men's jeans, Nautica children's and the entire Nautica sleepwear division, which now includes men's, women's and junior's sleepwear as well as men's underwear.

"We are encouraged that these results were achieved during one of the retail sector's most challenging Holiday periods."

He added the company has adopted a "conservative" outlook for fiscal 2004 due to weak consumer confidence and expects its top line to be essentially flat with earnings per share in the range of 95 cents to $1.00, excluding charges related to Nautica Europe.