Net sales for the fourth quarter ended December 31, 2014 at NYSE listed clothing distributor and retailer, American Apparel, Inc were down 9 per cent year over year.
Net sales for the fourth quarter of 2014 declined 9 per cent from the prior year quarter to $15.6 million, due to lower sales in all three sales channels.
Gross profit in the reporting quarter too fell 9 per cent to $72.2 million from $79.5 million for the same period in 2013, primarily due to lower retail and wholesale sales volume.
Gross profit, excluding significant charges, increased to 52.2 per cent of net sales in the fourth quarter of 2014 from 47.5 per cent in the corresponding quarter of 2013.
Operating expense for the fourth quarter of 2014 stood at $84.0 million, compared to $90.7 million for the same period in the previous year.
Excluding effects of customs settlement and contingencies charges, the internal investigation of Dov Charney and employment settlement and severance costs, operating expenses declined 12 per cent year on year.
“The decrease in costs was due to lower payroll and lower costs related to our advertising and promotional activities from our ongoing cost reduction initiatives,” American Apparel said in a press release.
In the quarter under review, net loss climbed higher to $28.0 million or $0.16 per share as against $20.8 million, or $0.19 per share for the fourth quarter of 2013.
According to American Apparel, results for the fourth quarter of 2014 include $15.4 million, or $0.09 per share, related to significant charges.
While, results for the fourth quarter of 2013 included $4.2 million or $0.04 per share also, related to significant charges.
As of December 31, 2014, it had $8.3 million in cash, $34.3 million outstanding on its asset-backed revolving credit facility and $13.1 million of availability for additional borrowing under the facility.
As of March 13, 2015, American Apparel had $5.8 million of availability for additional borrowings under the facility.
On March 25, 2015, the apparel retailer entered into the Sixth Amendment to the Capital One Credit Facility which waived any defaults under the Capital One Credit Facility.
This was due to failure to meet the obligation to maintain the obligation to maintain the maximum leverage ratio and minimum adjusted EBITDA for the measurement periods ended December 31, 2014.
