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ITHACA INDUSTRIES, INC.
HIGHWAY 268 WEST
P.O. BOX 620
WILKESBORO, NC 28697
(336) 667-5231
AT THE COMPANY: AT THE FINANCIAL RELATIONS BOARD:
Richard P. Thrush Marilyn Windsor Suzy Lynde Deanne Eagle
Senior Vice President General Inquiries Analyst Inquiries Media Inquiries
and CFO (312) 640-6692 (312) 640-6772 (212) 661-8030
(336) 667-5231
FOR IMMEDIATE RELEASE
ITHACA INDUSTRIES POSTS FIRST-QUARTER SALES GAIN
RESULTS FOR GLENDALE HOSIERY COMPANY INCLUDED EFFECTIVE MARCH 24, 1998
WILKESBORO, N.C., JUNE 8, 1998--ITHACA INDUSTRIES, INC., one of the
nation's largest manufacturers of private-brand men's and women's apparel and
women's hosiery products, today announced higher revenues for the fiscal 1999
first quarter ended May 2, 1998.
Revenues were $60.4 million versus $58.7 million in the prior year's
first quarter, an increase of 2.8 percent. Included in the quarter's revenue was
$3.8 million from the recently acquired Glendale Hosiery Company. The results
for Glendale are included for only 5 1/2 weeks for the quarter as the
acquisition was effective March 24, 1998.
The net loss for the period was $604,000, or $0.06 per share, versus
$150,000, or $0.02 per share, in the prior year's first quarter.
Gross profit for the first quarter of fiscal 1999 was 12.8 percent.
Included in this year's first quarter was $700,000 in costs for the closing of
the company's Robbins, N.C. hosiery plant. Without this one-time, non-recurring
cost, the quarter's gross margin would have equaled last year's gross margin of
14.0 percent. Total selling, general and administrative expenses increased to
$7.0 million
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from $6.8 million last year, but remained constant at 11.6 percent of sales in
both years.
Operating income for the year's first quarter was $700,000 versus $1.4
million for last year's first quarter. The decrease was attributable to the
previously mentioned non-recurring costs for closing the Robbins facility.
Interest expense remained constant with last year's first quarter at
$1.7 million despite the increased borrowing incurred for the acquisition of
Glendale.
Jim D. Waller, Ithaca's chairman, president and chief operating
officer, stated, "The closing of our Robbins hosiery facility was the correct
long-term decision despite the negative effect it had on the first quarter's
operating profit. We are pleased with the underlying foundation of the
business."
Waller also stated, "We are well along on combining the Ithaca and
Glendale hosiery operations and are confident that this consolidation will begin
to generate bottom-line improvement in the second half of the fiscal year."
Ithaca Industries, Inc. is one of the largest manufacturers of
private-brand men's and women's apparel and women's hosiery products in the
United States. Products are sold through a wide range of retail distribution
channels and are offered to the public through more than 10,000 customer
outlets, including discount stores, department stores, specialty stores, drug
stores and supermarkets. Ithaca stock is currently traded via the Nasdaq
bulletin board.
THIS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. FORWARD-LOOKING STATEMENTS
INVOLVE RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM FUTURE RESULTS IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. THESE
RISKS INCLUDE BUSINESS RISKS SUCH AS CHANGES IN THE PRICE OF RAW MATERIALS;
CONCENTRATION OF ITHACA'S PRINCIPAL CUSTOMERS; AVAILABILITY OF LABOR AND
COMPETITIVE FACTORS; INDUSTRY RISKS SUCH AS CHANGES IN THE RETAILING INDUSTRY
AND SHIFTS IN CONSUMER PREFERENCES; FINANCIAL RISKS SUCH AS LIQUIDITY AND ACCESS
TO CAPITAL; INTEGRATION OF THE GLENDALE HOSIERY COMPANY ACQUISITION; AND OTHER
RISKS AS SET FORTH FROM TIME TO TIME IN THE COMPANY'S FILINGS WITH THE
SECURITIES AND EXCHANGE COMMISSION.
FOR ADDITIONAL INFORMATION REGARDING ITHACA INDUSTRIES FREE OF CHARGE
VIA FAX, DIAL 1-800-PRO-INFO AND ENTER "ITHA9."
TABLES TO FOLLOW...
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ITHACA INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
Thirteen Weeks Ended
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May 2, 1998 May 3, 1997
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Net Sales....................................................$ 60,388 $ 58,743
Cost of Sales................................................ 52,643 50,527
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Gross Profit.............................................. 7,745 8,216
Selling, General and Administrative Expenses................. 7,032 6,789
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Operating Income.......................................... 713 1,427
Interest Expense............................................. (1,685) (1,744)
Other Income (Expense)....................................... 34 191
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Income (Loss) Before Income Taxes......................... (938) (126)
Income Tax (Expense) Benefit................................. 334 (24)
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Income (Loss)................................................ (604) (150)
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Basic and Dilutive Net Income (Loss) Per
Common Share.................................................$ (0.06) $ (0.02)
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Weighted Average Common Shares Outstanding................... 10,171 10,000
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