K-Swiss Inc. shrunk its net loss in the first quarter to $6.7 million, or 19 cents a share, from a loss of $9.8 million, or 28 cents, a year ago. Sales were down 4.3 percent to $69.3 million from $72.4 million.

Domestic revenues decreased 33.5 percent to $20.8 in the first quarter, and international revenues increased 17.8 percent to $48.5 for the same period.

Futures Orders

Worldwide futures orders with start ship dates from April to September 2012 decreased 32.0 percent to $71.6 at March 31, 2012, from $105.1  the previous year. Domestic futures orders decreased 54.0 percent to $21.7 at March 31, 2012, from $47.2  the previous year. International futures orders decreased 14.0 percent to $49.9 at March 31, 2012, from $58.0 the previous year.

Steven Nichols, chairman of the board and president, stated, “We have much work to do in reversing our overall backlog trend and the domestic business. Our focus initiatives for 2012 are addressing these trends with the launch of Clean Classics later in the year along with the appropriate marketing support. I’m pleased with the continued improvement with Palladium as well as the new distributor agreement in Korea that should provide for a total of six new stores in relatively short order.”

2012 Guidance

For 2012, the company is presently forecasting full year consolidated revenues to be approximately $225 million to $240 million. Consolidated gross margin is expected to be approximately 37 percent to 39 percent. Selling, general and administrative expenses are expected to be about $107 to $109 million. 

The new guidance is slightly down from the range provided on February 17 when the company reported fourth quarter results. At the time, K-Swiss forecast full year
consolidated revenues to be approximately $240 million to $250 million.
Consolidated gross margin was expected to be approximately 40 percent to
41 percent. Selling, general and administrative expenses was expected to
be about $110 to $112 million.

K•Swiss Inc. Consolidated Statements of Loss

(In thousands, except earnings per share data)


 
 

 
 



Three Months Ended



March 31,



2012

2011




(unaudited)

Revenues

$ 69,302



$
72,441

Cost of goods sold


 
 43,077
 


 
43,919
 

Gross profit


26,225




28,522

Selling, general and administrative expenses


 
 31,408
 


 
39,553
 

Operating loss


(5,183 )



(11,031
)

Other income


–




3,000

Interest expense, net


 
 (695 )


 
(61
)

Loss before income taxes and discontinued operations


(5,878 )



(8,092
)

Income tax expense


 
 905
 


 
524
 

Loss from continuing operations


(6,783 )



(8,616
)

Income/(Loss) from discontinued operations, less applicable income
tax


 
 77
 


 
(1,226
)

Net loss

$ (6,706 )


$
(9,842
)

Basic loss per share

$ (0.19 )


$
(0.28
)

Diluted loss per share

$ (0.19 )


$
(0.28
)

Weighted average number of shares outstanding






Basic


35,601




35,391

Diluted


35,601




35,391