Broder Bros. Co. Announces Fourth Quarter and Fiscal Year Results
Restructuring charges recorded during the fourth quarter of 2008 consisted of severance charges of $1.0 million related to a workforce reduction announced in December 2008, $1.0 million resulting from changes in sublease assumptions partially offset by a reduction to restructuring charges of approximately $0.5 million as the company executed a buyout agreement for its Stafford, TX distribution center, and interest accretion of $0.1 million.
Restructuring charges during the twelve months ended December 2008 consisted of $1.1 million in severance charges, $1.4 million resulting from changes in sublease assumptions partially offset by a reduction to the restructuring charge of approximately $0.5 million, and $0.7 million in interest accretion.
Expanding on an observation earlier in this press release, management believes that the company has begun to regain lost market share. Regaining lost market share began approximately at year-end in line with management's guidance following the end of the third quarter.
During Fiscal 2010, management will be focused on regaining lost market share and building the liquidity required both to retire the 2010 Notes and to pay cash interest in on the 2013 Notes in October 2010.
Management believes that the company halted the share loss of 2009 by securing its position as the "ultra-reliable distributor." This positioning exploits the company's ability to remain strongly in stock in the most popular products and rebuild its inventory in proprietary brands. It also exploits the company's superior fulfillment functions in its distribution centers, call centers, and websites. In addition, it relies on a commitment not to be undersold by competition which does not enjoy the company's strong margins and low variable operating costs.
Following the exchange offer, management determined that its strong operations were necessary but insufficient for long-term success. To that end, the company successfully recruited a senior sales and marketing executive into a newly created position of executive vice president of sales and marketing. This position has the responsibility for and the authority to, among other things, strengthen the company's selling effort to meet the needs of customers, rationalize the company's product assortment to increase its competitiveness, and offer pricing to attract customers from all segments of the imprintable sportswear market.