Jones Posts Net Loss, Agrees to Barneys Sale
NEW YORK – Jones Apparel Group, which is accepting the $900 million offer from the Japanese owners of Uniqlo for its Barneys New York department stores, is posting a quarterly net loss of $47.1 million, or 44 cents per share, compared with the same quarter last year’s profit of $36.6 million, or 32 cents per share.
Adjusted earnings of 17 cents per share – after the exclusion of discontinued operations, restructuring, and severances – were much lower than last year’s 39 cents per share. Jones’ total revenue for the second quarter dropped 2% to $903.9 million, with same-store sales at retail stores dropped 8 percent. The company is targeting adjusted earnings per share of $1.28 to $1.34 for 2007.
Jones New York did not find a buyer after it put itself up for sale last year, but it is expected to sell its Barneys New York luxury department store chain. Jones is still accepting offers for the whole company through August 11.
Fast Retailing Co., the Japanese company that operates the casual clothing retailer Uniqlo, made a $900 million cash offer to acquire Barneys New York from Jones Apparel Group last month. This trumps the Dubai-based Istithmar investment group’s $825 million offer from June, which Jones had agreed to. Jones reported today that it had notified Istithmar that it intended to accept the Fast Retailing offer.
The deal between Jones and Istithmar dictated that any offers after July 22 could not be taken without a $22.7 million fee paid to the Dubai group.
Uniqlo, Japan’s answer to H&M, opened its global flagship, the retailer’s first American store, in New York’s SoHo last September. It hopes to take on Gap. Adding Barneys to its holdings would give it precious access to a high end market with locations across the U.S.
Barneys has stores in New York, Beverly Hills, Boston, Chestnut Hill, Mass., Chicago, Dallas, and Seattle. A San Francisco location is scheduled to open in September 2007.
Jones New York’s brands include Jones New York, Evan-Picone, Gloria Vanderbilt, Nine West, Easy Spirit, Enzo Angiolini, Bandolino, Joan & David, Mootsies Tootsies, Sam & Libby, Napier, Kasper, Anne Klein, and Albert Nipon.
