Perry Ellis Q2 total revenues down by 2.3 percent

Perry Ellis International reported results for the second quarter ended July 28, 2012 (second quarter of fiscal 2013). Total revenue decreased 2.3 percent to 209.4 million dollars compared to 214.4 million dollars in the second quarter last year and in-line with company guidance of a low-single digit decrease. The company noted that continued momentum within golf, direct-to-consumer, and women’s contemporary was slightly offset by decreases in its Perry Ellis and Rafaella collection businesses.

Gross margin for the second quarter decreased by 60 basis points to 33.1 percent compared to 33.7 percent last year due to costs associated with the exit of underperforming brands and businesses, the closing of a sourcing office, as well as increased promotional activity within the company’s collection businesses.

As reported under generally accepted accounting principles (GAAP), net loss for the second quarter of fiscal 2013 was 2.4 million dollars, or earnings per share (EPS) of (0.17 dollars), compared to net income of 1.8 million dollars, or 0.11 dollars per fully diluted share in the second quarter of fiscal 2012. Adjusted EBITDA for the second quarter totaled 7.4 million dollars or 3.6 percent of revenue.

For the six months ended July 28, 2012 (first half of fiscal 2013) total revenues decreased 5.5 percent to 475 million dollars compared to 502.7 million dollars for the six months ended July 30, 2011 (first half of fiscal 2012) and in line with company guidance. Adjusted EBITDA for the first half of fiscal 2013 totaled 30.3 million dollars or 6.4 percent of revenue.

Net income for the first half of fiscal 2013 was 7.2 million dollars, or 0.47 dollars per fully diluted share, compared to 17.2 million dollars, or 1.08 dollars per fully diluted share in the first half of fiscal 2012.

The company ended the quarter with 82 million dollars in cash and cash equivalents and full availability under its senior credit facility. Inventories at quarter end totaled 164.7 million dollars, a reduction of 44.4 million dollars or 21 percent compared to 209.1 million dollars as of July 30, 2011. As a result of the disciplined management of inventory, the company ended the period with a net debt to total capitalization of approximately 20 percent as compared to 27 percent for the comparable prior year period. The company has updated its outlook for the full fiscal year expecting diluted EPS as adjusted in a range of 1.75 dollars to 1.80 dollars.

Perry Ellis International is a designer, distributor and licensor of a broad line of high quality men's and women's apparel, accessories and fragrances, as well as select children's apparel. The company's collection of dress and casual shirts, golf sportswear, sweaters, dress pants, casual pants and shorts, jeans wear, active wear, dresses and men's and women's swimwear is available through all major levels of retail distribution.