Fifth & Pacific reports 6.5 percent drop in Q2 net sales

Fifth & Pacific announced its earnings for the second

quarter of 2012. For the second quarter of 2012 on a GAAP basis, loss from continuing operations was 50 million dollars, or 0.46 dollars per share, compared to a loss from continuing operations of 54 million dollars, or 0.57 dollars per share, for the second quarter of 2011.

Adjusted EBITDA for the second quarter of 2012 was 16 million dollars, while comparable adjusted EBITDA was 7 million dollars for the second quarter of 2011 (excluding unrealized foreign currency gains (losses) of 2 million dollars in the second quarter of 2012 and 6 million dollars in the second quarter of 2011).

Net sales for the second quarter of 2012 were 337 million dollars, a decrease of 23 million dollars, or 6.5 percent, from the comparable 2011 period. Net sales increased 39 million dollars, or 13 percent on a comparable basis from the 2011 period, excluding the 62 million dollars decline in net sales associated with brands that have been sold or exited but not accounted for as discontinued operations.

For the first half of 2012, the company recorded a loss from continuing operations of 101 million dollars, or 0.96 dollars per share, compared to a loss from continuing operations for the first half of 2011 of 107 million dollars, or 1.13 dollars per share.

Net sales for the first half of 2012 were 654 million dollars, a decrease of 37 million dollars, or 5.3 percent, from the comparable 2011 period. Net sales increased 75 million dollars, or 13.1 percent on a comparable basis from the 2011 period, excluding the 112 million dollars decline in net sales associated with brands that have been sold or exited but not accounted for as discontinued operations. Cash flow from continuing operating activities for the last twelve months was 81 million dollars.

The adjusted results for the second quarter and first half of 2012 and 2011, as well as forward-looking targets, exclude the impact of expenses incurred in connection with the company's streamlining initiatives and brand-exiting activities, (losses) gains on extinguishment of debt and interest expense charges related to a multi-employer pension withdrawal liability.

Debt outstanding decreased to 503 million dollars compared to 769 million dollars in the second quarter of 2011. The company ended the first half of 2012 with 174 million dollars in cash and marketable securities, compared to 27 million dollars at the end of the first half of 2011. Company ended the quarter with 79 specialty retail stores, 52 outlet stores and 5 concessions, reflecting the net addition over the last 12 months of 3 outlet stores.

Headquartered in New York, Fifth & Pacific Companies designs and markets a portfolio of retail-based, premium, global lifestyle brands including Juicy Couture, kate spade, and Lucky Brand.