Martin Lawrence Loses $5.87 Million in Quarter

Martin Lawrence Limited Editions Inc., stung by the recession and the weak art market, said it lost $5.87 million in the fourth quarter that ended Dec. 31 on revenues of $6.2 million, contrasted with net income of $260,000 on $10.9 million in revenues for the same period a year earlier.

For all of 1991, the Van Nuys-based operator of shopping mall art galleries lost $11.5 million, contrasted with year-earlier net income of $3.6 million. Revenues plunged 49% to $24.87 million from $48.3 million in 1990.

Martin Lawrence said the fourth-quarter loss included a $2.76-million charge associated with the company’s decision to close 10 retail outlets. Nine of the stores were closed as of Dec. 31 and the 10th is scheduled to be closed by June, the company said.

The results were also affected by an accounting adjustment and the lack of a continuous supply of artworks by Hiro Yamagata, once the company’s most popular artist. Yamagata stopped producing artworks for Martin Lawrence a year ago after the company sued him over alleged breach of contract. That suit and a countersuit by Yamagata were settled last month.

Same-store sales--those stores open at least one year--dropped 30% in the fourth quarter compared with the same period in 1990, Martin Lawrence said. For all of 1991, same-store sales plunged 44%, the company said.

Meanwhile, Martin Lawrence said it has reached an agreement in principle with its bank to restructure its credit facility. The company had been notified by the bank that it was not meeting certain financial covenants. The agreement calls for Martin Lawrence to repay its $7.93 million in outstanding borrowings in installments through December, 1993.