Exhibit 99.1
PERRY ELLIS INTERNATIONAL, INC. REPORTS RECORD FOURTH QUARTER
AND YEAR END REVENUES AND OPERATING INCOME
MIAMI - April 7, 2004 – Perry Ellis International, Inc. (NASDAQ: PERY) today reported record total revenue for the fourth quarter ended January 31, 2004 of $145.4 million, an increase of $58.9 million, or 67.9% over the $86.5 million reported in the same period a year ago. Total revenue for the year ended January 31, 2004 was $505.9 million, an increase of $200.1 million, or 65.4% over the $305.8 million reported for the year ended January 31, 2003. The increase in both periods is primarily attributable to the inclusion of revenue from the company’s acquisition of Salant in June 2003 as well as an increase in sales from the company’s core wholesale division.
Operating income for the year ended January 31, 2004 was $44.8 million, an increase of $11.4 million, or 34.1%, from the same period a year ago. Fully diluted earnings per share, before a pre-tax charge related to certain note refinancing costs were $2.15 as compared to $1.65 per fully diluted share reported for the same period a year ago. As previously indicated, the company has taken a $7.3 million pre-tax charge to earnings in the third quarter for certain costs related to the Company’s refinancing of its $100 million 12 1/4% senior subordinated notes with a new issue of $150 million of 8 7/8% senior subordinated notes in September, 2003. After giving effect to the costs associated with the note refinancing, fully diluted earnings per share are $1.59 per share for the year ended January 31, 2004 as compared to $1.65.
For the fourth quarter ended January 31, 2004, diluted earnings per share were $0.93, an increase of $0.52 per diluted share, or 126.8% over the fourth quarter a year ago.
George Feldenkreis, chairman and chief executive officer, commented: “We are pleased that we have been able once again to report record revenues and earnings. The fourth quarter marked a noticeable change in consumer confidence that has carried into the beginning of this year. The retail climate is now as strong as we have seen in several years and we are benefiting from robust sales. Our brands are doing exceptionally well at retail not only because of this shift in consumer confidence, but also because our delivery of fashion and color ignited the business. As a result, we expect that sales for the current quarter will continue to generate record levels.”
He continued: “Through acquisition and internal growth, we have developed a brand portfolio that enables us to touch consumers through every retail channel. We are excited about the growth possibilities in all our product lines.
Oscar Feldenkreis, president and chief operating officer, emphasized the continued success of the company’s brand marketing strategy. “We feel that as the consolidation at retail and wholesale continues, our most important asset is our brands. As we transform into a company driven by brand marketing, we are perfecting the formula for maximizing our investment. We are combining a strategic focus on our top brands with regional and demographic focused marketing efforts that partner with key retailers. Our investment in brands is also tied to our commitment to innovative design and quality product. This focus is reflected in our top line growth, and we believe that this strategy will continue to produce results in the coming year.”
About Perry Ellis International
Perry Ellis International Inc. is a leading designer, distributor and licensor of a broad line of high quality men’s and women’s apparel, accessories, and fragrances, including dress and casual shirts, golf sportswear, sweaters, dress and casual pants and shorts, jeans wear, active wear and men’s and women’s swimwear to all major levels of retail distribution. The company, through its wholly owned subsidiaries, owns a portfolio of highly recognized brands including Perry Ellis®, Jantzen®, Cubavera®, Munsingwear®, John Henry®, Original Penguin®, Grand Slam®, Natural Issue®, Penguin Sport®, the Havanera Co.™, Axis®, and Tricots St. Raphael®. The company also licenses trademarks from third parties including Nike® and Tommy Hilfiger® for swimwear, and PING® and Ocean Pacific® for men’s sportswear. Additional information on PEI is available atwww.pery.com.
Safe Harbor Statement
Forward-looking statements (statements which are not historical facts) in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The actual results of Perry Ellis could differ materially from those expressed or indicated by forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, general economic conditions, a significant decrease in business from or loss of any of Perry Ellis’ major customers, the effectiveness of Perry Ellis’ planned advertising, marketing and promotional campaigns, the ability of Perry Ellis to contain costs, Perry Ellis’ future capital needs and ability to obtain financing, changes in fashion trends and consumer acceptance of both new designs and newly introduced products, ability to predict consumer preferences, anticipated trends and conditions in Perry Ellis’ industry, including future consolidation, the seasonality of Perry Ellis’ swimwear business, termination or non-renewal of any material license agreements to which Perry Ellis is a party, ability to integrate businesses, trademarks, trade names and licenses, including Salant, the level of consumer spending for apparel and other merchandise, exposure to foreign currency risk, possible disruption in commercial activities due to terrorist activity and armed conflict and other factors, including those set forth in Perry Ellis’ filings with the Securities and Exchange Commission. Investors are cautioned that all forward-looking statements involve risks and uncertainties, including those risks and uncertainties detailed in Perry Ellis’ filings with the SEC. Any forward-looking statements speak only as of the day hereof and Perry Ellis disclaims any intent or obligation to update the same.
Contact:
Rosemary Trudeau
VP Finance
Perry Ellis International, Inc. Announces
Fourth Quarter Fiscal 2004 Results
Perry Ellis International, Inc.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(in 000's, except per share information)
Three Months Ended January 31, | Twelve Months Ended January 31, | |||||||||||||
2004 | 2003 | 2004 | 2003 | |||||||||||
Net Sales | $ | 140,311 | $ | 78,978 | $ | 484,198 | $ | 277,028 | ||||||
Royalty income | 5,077 | 7,574 | 21,718 | 28,813 | ||||||||||
Total revenue | 145,388 | 86,552 | 505,916 | 305,841 | ||||||||||
Cost of sales | 93,865 | 58,487 | 336,415 | 205,001 | ||||||||||
Gross profit | 51,523 | 28,065 | 169,501 | 100,840 | ||||||||||
SG&A expenses | 33,801 | 18,146 | 119,666 | 63,850 | ||||||||||
Depreciation & amortization | 821 | 1,327 | 5,043 | 3,583 | ||||||||||
Total operating expenses | 34,622 | 19,473 | 124,709 | 67,433 | ||||||||||
Operating income | 16,901 | 8,592 | 44,792 | 33,407 | ||||||||||
Costs on early extinguishment of debt | — | — | 7,317 | — | ||||||||||
Interest expense | 3,631 | 3,989 | 16,414 | 15,796 | ||||||||||
Total other expenses | 3,631 | 3,989 | 23,731 | 15,796 | ||||||||||
Income Before Minority Interest and Income | ||||||||||||||
Taxes | 13,270 | 4,603 | 21,061 | 17,611 | ||||||||||
Minority Interest | (26 | ) | — | 214 | (89 | ) | ||||||||
Income tax provision | 4,811 | 1,820 | 7,695 | 6,726 | ||||||||||
Net income | $ | 8,485 | $ | 2,783 | $ | 13,152 | $ | 10,796 | ||||||
Earnings per share: | ||||||||||||||
Basic | 1.00 | 0.43 | 1.71 | 1.69 | ||||||||||
Diluted | 0.93 | 0.41 | 1.59 | 1.65 | ||||||||||
Weighted average outstanding shares: | ||||||||||||||
Basic | 8,463,132 | 6,420,824 | 7,683,442 | 6,387,459 | ||||||||||
Diluted | 9,152,627 | 6,755,898 | 8,296,153 | 6,550,126 |
3
PERRY ELLIS INTERNATIONAL, INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS
January 31, 2004 | January 31, 2003 | |||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 7,040,441 | $ | 4,683,177 | ||||
Accounts receivable, net | 115,786,815 | 79,489,739 | ||||||
Inventories | 109,044,011 | 51,306,474 | ||||||
Deferred income taxes | 8,584,466 | 2,957,765 | ||||||
Prepaid income taxes | 4,659,311 | 3,361,650 | ||||||
Other current assets | 6,297,143 | 4,104,767 | ||||||
Total current assets | 251,412,187 | 145,903,572 | ||||||
Property and equipment, net | 36,792,889 | 31,048,876 | ||||||
Intangible assets, net | 149,087,785 | 142,186,062 | ||||||
Deferred income taxes | 31,526,496 | — | ||||||
Other | 12,715,075 | 12,098,835 | ||||||
TOTAL | $ | 481,534,432 | $ | 331,237,345 | ||||
LIABILITIES & STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 31,644,178 | $ | 12,820,168 | ||||
Accrued expenses | 17,866,388 | 5,058,748 | ||||||
Accrued interest payable | 3,740,488 | 4,674,929 | ||||||
Unearned Revenues | 983,984 | 1,994,554 | ||||||
Other current liabilities | 2,608,903 | 1,457,422 | ||||||
Total current liabilities | 56,843,941 | 26,005,821 | ||||||
Senior subordinated notes payable, net | 150,454,235 | 99,180,580 | ||||||
Senior secured notes payable, net | 60,389,322 | 60,729,796 | ||||||
Senior credit facility | 34,714,584 | 22,922,287 | ||||||
Real estate mortgage | 11,600,000 | 11,600,000 | ||||||
Deferred pension obligation | 15,733,784 | — | ||||||
Deferred income tax | — | 10,694,595 | ||||||
Total long-term liabilities | 272,891,925 | 205,127,258 | ||||||
Total liabilities | 329,735,866 | 231,133,079 | ||||||
Minority Interest | 916,761 | 702,480 | ||||||
Stockholders’ Equity: | ||||||||
Preferred stock $.01 par value; 5,000,000 shares authorized; no shares issued or outstanding | — | — | ||||||
Common stock $.01 par value; 100,000,000 shares authorized; 8,470,700 shares issued and outstanding as of January 31, 2004 and 6,425,641 shares issued and outstanding as of January 31, 2003 | 84,708 | 64,257 | ||||||
Additional paid-in-capital | 66,073,881 | 27,198,094 | ||||||
Retained earnings | 85,334,665 | 72,182,529 | ||||||
Accumulated other comprehensive income/(loss) | 321,844 | (43,094 | ) | |||||
Common stock in treasury at cost; 35,687 shares as of January 31, 2004 | (933,293 | ) | — | |||||
Total stockholders’ equity | 150,881,805 | 99,401,786 | ||||||
TOTAL | $ | 481,534,432 | $ | 331,237,345 | ||||