Maidenform Brands Inc, a global branded marketer of intimate apparel announced financial results for the second quarter ended June 30, 2007.
Thomas J. Ward, Chief Executive Officer, stated, "I am pleased with our second quarter performance and our team's ability to drive strong earnings per share growth. We implemented three key actions in the quarter that further strengthened our position for long-term success."
"First, our focus on Maidenform's branded business led to low double-digit net sales growth in our branded wholesale business. Second, we improved consolidated gross margins by 220 basis points to 39.9% through our customer and product mix in the quarter, as well as sourcing initiatives."
"And last, we strengthened the balance sheet by refinancing our credit facility with significantly lower rates, while maintaining financial flexibility to execute future growth."
Financial Results for Second Quarter 2007 versus Second Quarter 2006:
Net sales for the second quarter of 2007 increased $1.9 million, or 1.6%, to $119.0 million. Wholesale segment net sales in the second quarter of 2007 increased $2.6 million, or 2.5%, to $105.2 million.
Total international sales, which are included in the wholesale segment, rose $1.5 million, or 17.0%, to $10.3 million. Retail segment net sales decreased $0.7 million, or 4.8%, to $13.8 million in the second quarter of 2007.
Wholesale Segment:
Department Stores and National Chain Stores:
Net sales for the department stores and national chain stores channel increased $8.6 million, or 14.4%, to $68.2 million in the second quarter of 2007.
Growth in this channel was largely driven by strong performance in the Company's full-figure Lilyette brand, the successful introduction of Maidenform's The Smooth Bra Collection and the launch of a new shapewear brand, Control It, with a national chain store customer.
Mass Merchants:
Mass merchant channel net sales decreased $5.5 million, or 17.7%, to $25.5 million in the second quarter of 2007. As previously stated, net sales in this channel were expected to be unfavorably affected for this period reflecting the transition throughout 2007 of re-intensifying the Company's Self Expressions brand from a private brand with one mass customer.
In the second quarter of 2007, Maidenform continued to increase the product placement and allotted selling space of its Sweet Nothings brand with one mass customer, particularly in full-figure bras, strapless bras and shapewear.
Other:
Other net sales, which include sales to specialty retailers, off-price retailers and licensing income, decreased $0.5 million, or 4.2%, to $11.5 million in the second quarter of 2007. This decrease was due to a non- recurring private brand program with a specialty retailer in the year-ago quarter, which was partially offset by an increase in licensing income, higher sales from an off-price retailer and liquidation sales in the second quarter of 2007.
