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Intimate apparel performs
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February 17, 1999: 5:43 p.m. ET
Intimate Brands, Fruit of the Loom post earnings that meet or beat Street
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NEW YORK (CNNfn) - Sexy sells. At least judging from the performance of Victoria Secret's parent company, which flashed fourth-quarter and year-end earnings Wednesday that were in line with Wall Street expectations.
Intimate Brands (IBI) reported fourth-quarter net income of $245.8 million, or 98 cents a diluted share, compared with $159.6 million, or 79 cents a share excluding one-time charges in the same period a year earlier.
Sales for the quarter were $1.53 billion, a 10 percent increase from 1997 thanks to an additional 180 stores, an 8 percent increase in comparable-store sales and a catalogue sales increase of 6 percent.
The company said it plans to add at least 260 stores in 1999.
For the year, the intimate-apparel maker posted a 21 percent increase in net income, for a total of $400.2 million, or $1.59 a share, also in line with analysts' forecasts.
Net sales hit $3.9 billion, up 7 percent over 1997, and comparable-store sales jumped 5 percent and catalogue sales rose 3 percent.
Shares in Intimate Brands fell 5/8 to close at 39-1/8 on Wednesday.
Fruit of the Loom beats Street
Less sexy, but essential, also can work. Fruit of the Loom (FTL), a manufacturer of basic family apparel best known for its underwear line, reported a fourth-quarter net loss, but its results exceeded expectations and showed vast improvement when compared to the year-earlier period.
The company posted a net loss of $11 million, or 15 cents a diluted share, compared with a loss of $404.9 million, or $5.57 a share in the fourth quarter of 1997. The 1997 results included after-tax restructuring and other charges totaling $372.2 million. Analysts had expected the company to lose 17 cents a share in the fourth quarter of 1998.
Net sales for the quarter were $491.4 million, up from the $428.5 million reported in the year-ago period.
For the full year 1998, the company recorded a profit of $135.9 million, or 1.89 per share. Again, its performance far exceeded that of 1997, when Fruit of the Loom posted a year-end loss of $487.6 million, or $6.55 a share. Analysts polled by First Call expected the underwear maker to report earnings of $1.86 a share.
Net sales for the year totaled $2.17 million, compared with $2.14 million in 1997.
The company's CEO, William Farley, said "We have made tremendous progress in 1998 focusing on cost reductions, completing the move of manufacturing offshore, improving customer service, new product development and inventory management. Inventory has been reduced from last year by $105.5 million and long-term debt declined by $93.9 million." He added that he expects further inventory savings and debt reduction in 1999.
Shares in Fruit of the Loom closed down 1 at 13-9/16 on Wednesday. 
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