G-III Third Quarter Sales Fall 8.4%; Cuts Guidance

G-III Apparel Group, for the three-month period ended October 31, 2004, reported net sales of $114.9 million and net income of $9.9 million, or $1.33 per diluted share, compared to net sales of $125.5 million and net income of $11.4 million, or $1.50 per diluted share, in the comparable period last year.

For the nine-month period ended October 31, 2004, G-III reported net sales of $175.3 million and net income of $3.4 million, or 46 cents per diluted share, compared to net sales of $189.6 million and net income of $11.5 million, or $1.54 per diluted share, in the comparable period last year.

The current nine-month period includes a non-cash charge of $882,000, equal to $0.12 per share, associated with the Company’s decision to attempt to sell its joint venture interest in a factory in China.

Morris Goldfarb, G-III’s Chief Executive Officer, said, “Although the market is a bit softer than we had anticipated, we are pleased with the direction of our business in general. While we expect to end up below our plan for the year, our financial position is strong and
we are looking forward to capitalizing on growth opportunities in the upcoming year with both existing and new businesses. As we announced last week, we renewed our license for Kenneth Cole women’s outerwear and expanded our relationship with Kenneth Cole to now include men’s
outerwear. This new men’s line will commence shipping for the fall 2005 season. This addition is an important part of our goal to establish ourselves as a leader in men’s outerwear.”

The Company has revised its guidance for the fiscal year ending January 31, 2005. For the fiscal year, the Company now forecasts net income per diluted share between 18 cents and 23 cents, changed from its previously announced forecast of 38 cents to 43 cents per diluted share.
These forecasts include the effect of the previously announced non-cash charge of $882,000, equal to 12 cents per share, associated with the Company’s decision to attempt to sell its joint venture interest in a factory in China. The Company’s forecast for net sales for the year remains at approximately $215 million.

              G-III APPAREL GROUP, LTD. AND SUBSIDIARIES
                             
                 CONSOLIDATED STATEMENTS OF OPERATIONS
          (in thousands, except share and per share amounts)
                              (Unaudited)

                            Three Months Ended     Nine Months Ended
                            10/31/04   10/31/03   10/31/04   10/31/03
                           ---------- ---------- ---------- ----------

Net sales                  $ 114,909  $ 125,547  $ 175,322  $ 189,558
Cost of sales                 81,358     88,208    129,471    132,184
                           ---------- ---------- ---------- ----------
Gross profit                  33,551     37,339     45,851     57,374
Selling general and
 administrative expenses      15,638     16,785     37,502     36,388
Write down of equity
 investment                                            882
                           ---------- ---------- ---------- ----------
Operating profit              17,913     20,554      7,467     20,986
Interest and financing
 charges, net                    550        583        820        861
                           ---------- ---------- ---------- ----------
Income before income taxes    17,363     19,971      6,647     20,125
Income tax expense             7,466      8,591      3,237      8,654
                           ---------- ---------- ---------- ----------
Net income                 $   9,897  $  11,380  $   3,410  $  11,471
                           ========== ========== ========== ==========
Basic net income per
 common share              $    1.38  $    1.65  $    0.48  $    1.67
                           ========== ========== ========== ==========
Diluted net income per
 common share              $    1.33  $    1.50  $    0.46  $    1.54