New York—A leaner Fifth & Pacific Companies Inc. today reported a narrowed third quarter loss, helped by another quarter of double-digit sales increases at kate spade new york.
For the quarter ended Sept. 28, the former Liz Claiborne Inc. posted a loss of $16.87 million, or 14 cents a share, compared with a loss of $18.8 million, or 17 cents a share in the year-ago quarter. Excluding items related to the sale of its intellectual property of Juicy Couture and other moves, the company lost 3 cents a share.
Revenue rose 18% to $430.6 million, up from $364.5 million a year ago. Analysts expected a loss of 2 cents a share on sales of $430 million.
Kate Spade Sales Up 76.4%
By division, kate spade new york posted a 76.4% increase to $180 million, driven by gains in all channels, including $25 million in sales in Japan. Lucky Brand posted revenue of $120 million, a 7.3% increase. Juicy Couture posted a 9.1% decline to $118 million reflecting drops in its wholesale non-apparel, specialty retail and wholesale clothing operations, partially offset by gains in its e-commerce and outlets.
In the direct-to-consumer segment, kate spade brand had a 31% increase in comp store sales while Lucky Brand was flat. Juicy Couture’s comp store sales were down 3%.
During the quarter, Fifth & Pacific completed the sale of the intellectual property of the Juicy Couture brand to the Authentic Brands Group for $195 million in cash. As part of a short-term licensing agreement with Authentic Brands Group, the company will transition the business through the first half of 2014, “with a $10 million guaranteed minimum royalty payable to Authentic Brands Group.”
According to William McComb, chief executive, “We are exploring opportunities to unlock value associated with the Juicy Couture store on Fifth Avenue. We believe proceeds from a transaction resulting in exiting this lease are likely to materially improve the total net proceeds resulting from our decision to sell and exit the Juicy Couture business. We are also weighing this opportunity against the merits and economics of converting the Fifth Avenue store into a Kate Spade store. We expect to finalize our decision in the near future.”
Fifth & Pacific has also reportedly been looking to sell Lucky Brand, though the company hasn’t commented on any decisions about Lucky Brand.