NexCen Brands, Inc., the parent of The Athlete's Foot (TAF), finally filed its fiscal 2008 full year and 2009 first quarter results with the Securities and Exchange Commission following a lengthy probe into accounting irregularities. Although the company showed losses in both periods, the loss was much lower in the first quarter, thanks to restructuring efforts undertaken during the prior year.


Regarding TAF, NexCen's 10-K filing noted that TAF operated about 560 franchised stores in 35 countries at the end of 2008. That's down from the approximately 640 in operation in 40 countries listed at the close of 2007.


On a conference call with analysts, company CEO Ken  Hall, CEO only mentioned that TAF recently marked its 50th store Mexico, and the company overall executed a franchise agreement for all six of its franchised brands to be represented in countries throughout Africa. The first quarter 10-Q filing also noted that the company received $6.2 million from the TAF business in agreeing to a new 99-year, exclusive franchising agreement covering Australia and New Zealand.
Other franchised operations include Shoebox New York, MaggieMoo's, Marble Slab Creamery, Pretzel Time, Pretzelmaker and Great American Cookies.


In the first quarter, total revenues rose 16.6% to $11.9 million from $10.2 million a year ago.


The loss from continuing operations was $700,000, or 2 cents, compared with a deficit of $6.4 million, or 11 cents, a year ago. The lower loss reflected restructuring efforts initiated last year that included reducing expenses, restructuring its credit facility, overhauling its management, as well as selling its Bill Blass and Waverly businesses.
Management noted that Q1 was the first quarter in three years in which the company generated cash from its operations. Total debt was cut to $142.5 million at quarter-end from $178.7 million at the comparable point last year.


In 2008, total revenues were $47.0 million compared to $19.6 million in 2007, reflecting the Great American Cookies acquisition in January 2008. Operating expenses surged to $194.2 million in 2008 from $26.7 million in 2007. The loss from continuing operations in 2008 of $153.6 million, or $2.71 per share, reflected impairment charges of $137.9 million, $3.9 million in professional fees related to special investigations, and $1.1 million in restructuring charges. Including discontinued operations, the net loss was $255.8 million, or $4.52 a share, compared to a loss of $4.9 million, or 9 cents, a year ago.


Hall said the company continues to work to regain compliance with the SEC's financial reporting requirements while working to grow its franchised operations.