Mossimo Blames Poor Sales for Loss of 3 Cents Per Share

IRVINE — Sportswear maker Mossimo Inc., which has been battered by Wall Street since September, said Thursday that it lost $498,000, or 3 cents a share, for the first quarter on flat sales.

The company previously said that it expected to post a quarterly loss mainly from nonrecurring pretax charges of about $950,000 for closing a Mossimo division as well as from severance costs in reducing its work force by 7%.

Mossimo said it also experienced lower sales of its activewear products, which typically carry higher profit margins.

The company earned nearly $4 million, or 28 cents a share, in last year’s first quarter. The company went public in n February, 1996.

Mossimo’s sales rose slightly to $24.6 million for the first quarter from $24.4 million.

To revive its sales of men’s activewear, in particular, the company said it assembled members of its design team to develop a new line of value-priced activewear products, targeted at younger men. Mossimo expects to launch the new line in spring 1998.

Wall Street, which had pumped up the company’s stock last year to $50.125 a share, brought it down last week to an all-time low of $5.875 a share. The stock has been climbing since, gaining 50 cents a share Thursday to close at $7.875 a share on the New York Stock Exchange.

On Wednesday, the stock rose 18% in heavy trading, prompting an inquiry from the New York Stock Exchange. Mossimo issued a statement saying it had no explanation for the trading activity.