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Guess Posts a Loss as Sales Slide

February 27, 2003|Jerry Hirsch | Times Staff Writer

Sales and profit at Guess Inc. shrank faster than a pair of tight-fitting bluejeans in the fourth quarter but the company, once one of Southern California's top fashion houses, is beginning to see some positive trends.

The Los Angeles-based apparel company said Tuesday that it lost $4.6 million, or 11 cents a share, in the fourth quarter of 2002, contrasted with a gain of $1.4 million, or 3 cents, in the same period a year earlier.

Sales slid 8.7% to $167.4 million from $183.4 million. Same-store sales, a key measure of a retailer's financial health, dipped 0.9% in the period.

The results included restructuring, severance and other charges. Excluding those, the company would have had a profit of $1.5 million, or 3 cents a share.

"We expect business to remain challenging for the rest of 2003," said Carlos Alberini, Guess president and chief operating officer.

But Alberini was buoyed by improvements in the company's line of men's clothing. Sales of men's apparel rose in the quarter for the first time in two years, Alberini told analysts and investors during a conference call after the stock market closed.

"It was a long process to reposition the whole line and we are now starting to see the results," he said.

Alberini added that he expects overall sales to grow modestly during the year, and that the second half of the year should be stronger than the current period. Guess ended the year with 249 stores.

"The fact that they could generate some positive growth in men's business is good considering not too many other retailers were able to do that in the current environment," said Dorothy Lakner, an analyst at CIBC World Markets in New York.

Guess shares fell 21 cents, or 6%, to close at $3.50 on the New York Stock Exchange.

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