EXHIBIT 99.1
PRESS RELEASE Source: Tag-It Pacific, Inc.
CORRECTION: TAG-IT PACIFIC, INC PROVIDES GUIDANCE FOR FIRST QUARTER AND
FULL-YEAR 2005, AND MAY MODIFY INADVERTENTLY RELEASED 2004 RESULTS
LOS ANGELES --April 1, 2005--Tag-It Pacific, Inc. (AMEX:TAG)
Highlights:
o Allowances for doubtful accounts receivable for 2004 may be
modified
o Company expects 30% revenue growth for 2005 first quarter and
40% revenue growth for fiscal 2005 as compared to 2004
Tag-It Pacific, Inc. (AMEX:TAG), a full service outsourced trim management
department for manufacturers of fashion apparel, today announced a potential
correction to its previously released financial results for 2004, and provided
financial guidance for the Company's first quarter and fiscal year 2005.
On Thursday, March 31, 2005, in a conference call and in a Current Report on
Form 8-K filed after the close of trading, Tag-It Pacific advised its
stockholders that its financial results for the fourth quarter and fiscal year
ended December 31, 2004 had been released inadvertently, and are subject to
revision. Prior to the inadvertent release, the Company had determined that
continued discussions with its auditors concerning certain accounts receivable
were required to finalize fiscal year end numbers. The Company noted in its
current report and during its earnings conference call, that resolution of these
discussions may require the Company to provide an additional allowance, as
compared to amounts reflected in the earnings release, of between $0 and $1
million. The Company noted that a second earnings release will be issued as soon
as the amount of the allowance adjustment, if any, is determined.
For the 2005 first quarter, management expects revenues to increase
approximately 30 percent compared to revenues for the first quarter of last
year.
For all of 2005, management expects revenues to increase approximately 40
percent compared to annual revenues for 2004. The Company expects gross margins
of 26 to 28 percent for the year. By the end of the year, the Company expects
the Selling, General and Administrative expenses to stabilize between $16 and
$17 million. The Company expects to report profitability by the second fiscal
quarter and maintain profitability throughout the balance of the fiscal year.
About Tag-It Pacific, Inc.
Tag-It specializes in the distribution of a full range of trim items to
manufacturers of fashion apparel, specialty retailers and mass merchandiser.
Tag-It acts as a full service outsourced trim management department for
manufacturers of fashion apparel such as Kellwood and Azteca Production
International. Tag-it also serves as a specified supplier of trim items to
specific brands, brand licensees and retailers, including Levi Strauss & Co.,
Motherworks, Express, The Limited, Miller's Outpost and Lerner, among others. In
addition, Tag-It distributes zippers under its Talon brand name to manufacturers
for apparel brands and retailers such as Levi Strauss & Co., Wal-Mart and JC
Penny, among others. In 2002, Tag-It created a new division under the TekFit
brand name. This division develops and sells apparel components that utilize the
patented Pro-Fit technology, including a stretch waistband.
Forward Looking Statements:
With the exception of the historical information, this press release contains
forward-looking statements, as referenced in the Private Securities Litigation
Reform Act. Forward-looking statements are inherently unreliable and actual
results may differ materially. Examples of forward-looking statements in this
press release include projected revenue growth, gross margins, and selling,
general and administrative expenses, and anticipated profitability. Factors
which could cause actual results to differ materially from these forward-looking
statements include an unfavorable outcome in our litigation with Pro-Fit
Holdings relating to our stretch waistbands, the unanticipated loss of one or
more major customers, economic conditions, the availability and cost of
financing, the risk of a softening of customer acceptance of the Company's
products, risks of introduction by competitors of trim management systems with
similar or better functionality than our Managed Trim Solution, default by our
Talon franchisees in their obligations to us, pricing pressures and other
competitive factors, potential fluctuations in quarterly operating results, our
management of potential growth and the risks of expansion into new business
areas. These and other risks are more fully described in the Company's filings
with the Securities and Exchange Commission including the Company's most
recently filed Annual Report on Form 10-K and Quarterly Report on Form 10-Q,
which should be read in conjunction herewith for a further discussion of
important factors that could cause actual results to differ materially from
those in the forward-looking statements. The Company undertakes no obligation to
publicly update or revise any forward-looking statements, whether as a result of
new information, future events or otherwise.
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CONTACT:
Hayden Communications, Inc.
Matthew Hayden, 858-456-4533
matt@haydenir.com
www.haydenir.com