Perry Ellis International Reports Fourth Quarter & Full Fiscal 2014 Results

On April 3, 2014, Miami-based Perry Ellis International Inc. reported results for the fourth quarter ("fourth quarter of fiscal 2014") and the fiscal year ended Feb. 1, 2014 ("fiscal 2014").

Oscar Feldenkreis, president and chief operating officer of Perry Ellis International commented. "We were disappointed with the results of fiscal 2014. The year saw significant challenges, with unseasonal weather, consumer indifference to apparel, and declines in mall and outlet center traffic all negatively impacting our business," he said. "We also experienced a fundamental shift in the business model favoring national brands over private and exclusive brands, thereby impacting revenues and near term profitability. On a positive note, there were many encouraging areas: our overall golf lifestyle apparel business, international, as well as Nike swim continued to be strong. Licensing income grew dramatically in the fourth quarter reflecting the strength of our core brands, and gross margins expanded by 170 bps in the fourth quarter reflecting the strength of these businesses coupled with our successful turnaround of the Rafaella sportswear collection."

Fiscal 2014 Fourth Quarter Results
Total revenue for the fourth quarter of fiscal 2014 was $216 million, a 16 percent decrease compared to $258 million reported in the fourth quarter of fiscal 2013. Revenues were adversely impacted by both inclement weather countrywide, as well as a cautious consumer. As a result, the company saw a lack of replenishment orders across many of the business platforms.

During the fourth quarter of fiscal 2014, gross margins expanded to 34.3 percent as compared to 32.6 percent in the same period of the prior year, reflecting a lower level of promotions in our Rafaella and Perry Ellis collections businesses as well as higher contributions from the golf lifestyle, international and licensing businesses discussed above.

The company's fourth quarter 2014 results included a $42.9 million or $1.94 per share non-cash write down of certain intangible assets, primarily trade names, goodwill and certain store leaseholds. These impairments were the product of our internal review of non-core brands and businesses.