The Warnaco Group reported revenues in its swimwear group, which is primarily composed of Speedo, slid 9.7 percent in the first quarter, to $91.9 million from $101.7 million a year earlier. Operating income improved slightly, to $14.8 million from $14.1 million.
On a conference call with analysts, Helen McCluskey , Warnaco Group’s president and CEO, said management was “pleased” with Speedo’s operating results in the period.
“Modest revenue declines reflected a planned elimination of some lower margin sales, which drove improved operating margins,” said McCluskey. “It's an Olympic year, and we are looking forward to leveraging that excitement. With 14 sponsored athletes competing to make the 2012 Olympic team, Speedo recently debut their Team Speedo collection, a new line of deckwear and team apparel inspired by their biggest swimming stars. The collection launches our consumer segmentation strategy, extending Team Speedo, USA's signature style, to a broader swim community.”
Overall, Warnaco Group reported net income fell 18.4 percent to $35.9 million, or 86 cents a share. Revenues slid 7.1 percent to $615.5 million. While sales were expected to decline due to a drop in orders to lower-priced retailers and foreign currency fluctuations, they missed expectations due to higher markdowns in U.S. sportswear and lower revenue than expected in its own stores open at least a year, particularly in Korea. Warnaco’s core businesses are Calvin Klein intimate apparel and jeans.
