Perry Ellis International Inc. said delays in shipping at West Coast ports hurt its third-quarter results, as the struggling clothing company continues to be beset by pressures to explore a buyout.
Though the company’s loss narrowed, sales dropped and results missed expectations.
The company’s shipping snaufus echo issues faced by Ann Inc., which owns the Ann Taylor and Loft stores, and other apparel companies this fall.
The twin ports at Los Angeles and Long Beach handle the lion’s share of imports from Asia arriving at the West Coast. But they have been hit by labor and equipment issues, and the troubles are adding weeks to deliveries during the peak season for imports as retailers stock up ahead of the holidays.
Beyond those pressures, The Wall Street Journal reported last week that Sequential Brands Group approached Perry Ellis about a possible takeover in light of the Florida-based company’s difficulty remaining competitive. The company has said it is running a review of its brands and plants to exit low-growth businesses.
Perry Ellis, which became popular in the 1990s, is more recently seen as a dusty brand in the fashion community, especially compared with other brands that emerged around that time.
Meanwhile, Legion Partners LLC and the pension-fund giant California State Teachers’ Retirement System, or Calstrs, made public this week a letter they had sent a letter to the company’s board a month ago, urging it to run a formal sales process. Together, they own about 6.3% of the company.
In all, Perry Ellis posted a loss for the quarter ended Nov. 1 of $437,000, or three cents a share, narrowing from a year-earlier loss of $3 million, or 20 cents a share. Excluding special items, earnings rose to 3 cents a share from a loss of 15 cents the year before.
Sales dropped 5% to $211 million from $222 million the year earlier.
Analysts had expected a profit of 6 cents on revenue of $215 million, according to Thomson Reuters.
In the most recent quarter, increases in the accessories and international segments offset planned reductions in the Perry Ellis and Rafaella collection sportswear. In addition, there was strength in the Original Penguin brand and the Callaway golf brand.
The company backed its guidance for the year.
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