Liz Claiborne announce quarterly loss

American fashion conglomerate Liz Claiborne announced today earnings fell for the third quarter and nine months of 2007. The results reflect financial performance substantially below that of the year ago period, but in line with management's forecasts. The initiatives identified in the turnaround plan announced on July 11th remain on track, as the Company is ahead of its cost reduction targets for fiscal 2008 with $130 million implemented or well under way and is also ahead of schedule on the process for the 16 brands under strategic review.

For the third quarter of 2007, diluted earnings per share ("EPS") were $0.33 compared to $0.93 for the third quarter 2006. Net sales for the third quarter 2007 were $1.263 billion, a decrease of 3.9% from the comparable 2006 period.

For the nine months of 2007, diluted earnings per share were $0.62 compared to $1.75 for the comparable 2006 period. Net sales for the nine months of 2007 were $3.455 billion, a decrease of 1.3% from the comparable 2006 period.

Liz CEO William L. McComb said: "The initiatives identified in the turnaround of Liz Claiborne Inc. are fundamentally on track. While third quarter 2007 results are tough to look at, particularly compared to last year, they are consistent with what we forecasted back in May when we announced the significant changes in our earnings outlook for 2007."

Mr. McComb continued, "Importantly, we are satisfied with the progress on all five initiatives laid out on July 11th as our Designed-to-Win strategy, some of which are proceeding ahead of schedule. In fact, we have accelerated the strategic review process on the 16 brands and aggressively increased our cost reduction initiatives. We are particularly pleased with our Direct Brands portfolio, which included an out-sized performance at Juicy Couture, solid profitability at Lucky Brand and strong fundamentals at Kate Spade. Our Mexx Europe business saw weak sales and profits, but made substantial progress in launching dramatic initiatives to improve their operation over the next 6 quarters-spanning product, cost structure, and talent deployment. In this sense, Mexx Europe is engaged in the same kind of turnaround that the overall corporation has initiated. While our Partnered Brands segment continues to challenge the overall performance picture, we are near completion on detailed merchandising, product design, and partnering initiatives to address the core Liz Claiborne brand specifically."

Mr. McComb added, "There's no question the macroeconomic headwinds will pose ongoing pressure during our turnaround, and to the retail industry at large. However, we remain confident in our strategy of focusing on powerful brands with strong direct-to-consumer paths, while improving our legacy wholesale businesses and aggressively managing our cost structure. We will maintain our financial flexibility while prudently executing our plan."

Mr. McComb concluded, "Regarding our 2007 outlook, we are revising the fiscal 2007 guidance we provided in July, primarily reflecting the impact of the brands under strategic review. Fiscal 2007 guidance excluding brands under strategic review is essentially unchanged."