Mossimo Posts 1st Quarterly Profit in 2 Years
Mossimo Inc. reported its first quarterly operating profit in two years Thursday, as sales from ongoing operations rose 22%.
Factoring in a one-time charge of $6.1 million, the Irvine-based clothing designer remained in the red.
Still, Mossimo’s improving numbers indicate that its internal reorganization is paying off, Chief Executive Edwin Lewis said in a statement.
“We are very focused on the relaunch of the Mossimo brand and believe the results for the quarter reflect increasing support and confidence from the retail community,” Lewis said.
A renewed interest in the brand reflects a stronger design team, led by founder Mossimo Giannulli, he said.
The company lost $5.5 million, or 36 cents a share, in the second quarter ended June 30, compared with a loss of $6.1 million, or 41 cents a share, in the comparable period last year.
Excluding the $6.1-million charge, Mossimo earned $625,000, or 4 cents a share.
Sales of men’s and women’s clothing rose to $10.4 million, compared with $8.5 million during the same quarter last year.
Overall, sales were $11.4 million, compared with $11.5 million in 1998’s second quarter. Last year’s numbers included $1.5 million in sales from the Moss line and screen-printing business, both of which were discontinued last year.
The charge was related to insurance coverage purchased by Giannulli to supplement the company’s existing policies and resolve a class-action lawsuit against the company that was recently settled.
The company has been working to rebound from problems that arose after it shifted too quickly to fashion-oriented apparel from its beachwear roots.
To regain its financial footing, the company initially hired turnaround specialist John Brincko, who slashed costs and moved Mossimo to a smaller, less expensive headquarters. Then, Giannulli brought in Lewis, former Tommy Hilfiger chief executive.
Mossimo’s shares closed Thursday at $9.13, down 25 cents, in New York Stock Exchange trading. The quarterly results were posted after the market closed.
At a Glance
Other earnings, excluding one-time gains and charges unless noted:
* Santa Barbara-based apparel maker and retailer Big Dog Holdings Inc. reported higher second-quarter net income of $734,000, or 6 cents per share, compared with $327,000, or 3 cents, a year ago. Sales rose to $24.1 million from $22.4 million.
The company, which makes clothing under the Big Dog label, also said it signed an agreement with Hartbreak Films Inc. to develop a television series for its Big Dog character logo.
* Callaway Golf Co., the Carlsbad-based maker of Big Bertha and other clubs, reported a 17% increase in second-quarter net income of $24.8 million, or 35 cents per share, compared with net income of $21.1 million, or 30 cents, a year ago. Sales fell 2% to $229.7 million from $233.2 million. The company also warned of lower sales and earnings in the second half of the year because of costs associated with its first-time production of golf balls.
* Santa Monica-based FirstFed Financial Corp., parent company of First Federal Bank of California, reported second-quarter net income of $9.1 million, or 47 cents per share, compared with $8.6 million, or 40 cents, a year ago.
* IHOP Corp., the Glendale-based franchiser and operator of International House of Pancakes restaurants, reported record second-quarter net income of $7.8 million, or 39 cents per share, compared with $6.4 million, or 32 cents, a year ago. Systemwide sales rose 11.2% to $278 million.
* Restaurant operator Il Fornaio Corp., of Corte Madera, Calif., citing charges related to the opening of a new restaurant in the Venetian Resort Hotel & Casino in Las Vegas, said second-quarter net income fell to $980,000, or 16 cents per share, from $1.1 million, or 17 cents, a year ago. Revenue rose to $23.7 million from $20.5 million.
* Merisel, an El Segundo-based computer products distributor, reported a second-quarter net loss of $12 million, or 15 cents per share, compared with net income of $5.1 million, or 6 cents, a year ago. Revenue rose to $1.3 billion from $1.1 billion.
* Robert Mondavi Corp., the Oakville, Calif.-based winery, reported fiscal fourth-quarter net income of $8.8 million, or 55 cents a share, compared with $5.1 million, or 32 cents, a year ago. Revenue increased 16% to $105.2 million.
* San Diego-based utility Sempra Energy reported second-quarter net income of $95 million, or 40 cents a share, compared with $106 million, or 45 cents, a year ago. Sales rose to $1.5 billion from $1.2 billion.
* Los Angeles-based Sports Club Co. reported second-quarter net income of $299,000, or 2 cents per share, compared with a net loss of $462,000, or 2 cents, a year ago. Revenue rose to $22.2 million from $20.3 million.
MORE EARNINGS: C3, C5