G-III Apparel Group, Ltd. reported second qaurter net sales of $69.1 million and a net loss of $1.7 million, or 14 cents per share, compared to net sales of $54.6 million and a net loss of $301,000, or 3 cents per share, during the comparable period last year. This compares to the Company’s previous guidance for the second quarter of a net loss between 30 cents and 35 cents per share.

For the six-month period ended July 31, 2006, the Company reported net sales of $83.5 million and a net loss of $10.6 million, or $0.85 per share, compared to net sales of $68.3 million and a net loss of $5.0 million, or $0.45 per share, during the comparable period last year. The seasonal loss in the second quarter and first six months of fiscal 2007 was higher than last year primarily due to the inclusion of the results of the two companies acquired in July 2005.

All share and per share data in this release have been retroactively adjusted for the Company’s three for two stock split effective March 28, 2006.

Morris Goldfarb, G-III’s Chief Executive Officer, said, “We continue to see broad-based strength in our business. In addition to a strong outerwear business across our portfolio of licenses, we are very excited about our recent initiatives in the women’s suit, dress, and sportswear categories. We believe that we are continuing on the path toward transforming our business into a highly diversified, all season apparel company.”

Mr. Goldfarb continued, “As we approach our key shipping season for the outerwear business, we are encouraged by having booked in excess of 90% of our forecasted revenues for the year. We are focused on executing at a high level and anticipate a good fall and holiday season. While the retail environment remains challenging, we believe that our product lines are well positioned and that we have an opportunity to post strong financial results.”

Mr. Goldfarb concluded, “Our business, has never had more opportunities or been better diversified. We have a powerful combination of branded partners such as Calvin Klein, Sean John, Kenneth Cole and Guess, among others, a solid infrastructure, a stronger balance sheet as a result of our recently completed private placement and excellent relationships with retailers in every tier of distribution. We intend to leverage our strategic position to broaden our business, expand our growth opportunities and drive significant value to our shareholders.”

For the full fiscal year ending January 31, 2007, the Company is now forecasting net sales of approximately $410 million and diluted net income per share between $0.63 and $0.67. This compares to its previous guidance of net sales of approximately $400 million and diluted net income per share between $0.58 and $0.62.

The Company now projects EBITDA to increase 29% to 34%, or to approximately $26 to $27 million, up from $20.1 million in fiscal 2006. EBITDA results should be evaluated in light of the Company’s financial results prepared in accordance with GAAP. A reconciliation of EBITDA to net income in accordance with GAAP is included in a table accompanying the condensed financial statements in this release.

              G-III APPAREL GROUP, LTD. AND SUBSIDIARIES

                             (NASDAQ:GIII - News)
               CONSOLIDATED STATEMENTS OF OPERATIONS AND
                      SELECTED BALANCE SHEET DATA

          (in thousands, except share and per share amounts)
                              (Unaudited)



                          Three Months Ended         Six Months Ended
                                July 31,                 July 31,
                            2006        2005        2006        2005

Net sales                 $69,082     $54,553     $83,471     $68,320
Cost of sales              52,249      41,804      65,959      54,656
                       ----------- ----------- ----------- -----------
Gross profit               16,833      12,749      17,512      13,664
Selling, general and
 administrative
 expenses                  17,478      12,117      31,817      20,922
Depreciation and
 amortization               1,112         483       2,197         781
                       ----------- ----------- ----------- -----------
Operating  income
 (loss)                    (1,757)        149     (16,502)     (8,039)
Interest and financing
 charges, net               1,264         527       1,911         530
                       ----------- ----------- ----------- -----------
Loss before income
 taxes                     (3,021)       (378)    (18,413)     (8,569)

Income tax benefit         (1,284)        (77)     (7,826)     (3,599)
                       ----------- ----------- ----------- -----------
Net loss                  $(1,737)      $(301)   $(10,587)    $(4,970)
                       =========== =========== =========== ===========
Net loss per common
 share:
     Basic and Diluted     $(0.14)     $(0.03)     $(0.85)     $(0.45)
                       =========== =========== =========== ===========
Weighted average
 shares outstanding:
     Basic and Diluted 12,756,000  11,237,000  12,410,000  11,007,000