Cherokee Group Reports $78,000 Loss for Quarter

Cherokee Group, a Sunland-based apparel and shoe concern, said it lost $78,000 in its fiscal second quarter, compared with a year-earlier profit of $1.57 million.

The loss came despite a 51% surge in Cherokee’s sales in the quarter that ended Dec. 2, to $42 million from $27.9 million. For the first half of its fiscal year, Cherokee lost $194,000, contrasted with an $891,000 profit a year earlier, and its six-month sales rose 30% to $92.3 million from $71.1 million.

Cherokee was acquired by a private investor group in May, 1989, for $174 million, most of which was borrowed. As a result, Cherokee’s debt-interest costs in the six months that ended Dec. 2 soared to $12.7 million from $20,000 a year earlier and led to the net loss.

The figures were included in a quarterly financial statement Cherokee filed with the Securities and Exchange Commission. Although its stock is no longer publicly held, Cherokee must disclose its results because it sold debt securities to the public as part of its acquisition.