Timberland`s operating income improves in Q3

Fashion

Timberland`s operating income improves in Q3

The Timberland Company reported third-quarter 2008 net income of $30.7 million and earnings per share of $0.52. These results compare to third-quarter 2007 net income of $25.9 million and earnings per share of $0.42. When adjusted to exclude restructuring and related costs, earnings per share were $0.52 and $0.49 in the third quarters of 2008 and 2007, respectively. Third-Quarter 2008 Results Summary: * Revenue declined 2.2% to $423.6 million as declines in Timberland brand apparel, which reflect the Company`s transition to a licensing model for its North American wholesale business, were partially offset by strong growth in Timberland PRO series footwear and SmartWool socks and apparel. Foreign exchange rate changes increased third-quarter 2008 revenue by approximately $10 million, or 2.2%, due to the strength of the Euro and the Yen, and increased operating income by approximately $3 million. * North America revenue declined 8.8% to $184.5 million, reflecting soft consumer spending in the U.S. Europe revenue increased 4.4% to $199.9 million and increased slightly on a constant dollar basis, driven by strength in all footwear categories which offset declines in the apparel business. Asia revenue decreased slightly to $39.2 million, and decreased 5.4% on a constant dollar basis, driven by declines in the outdoor performance and casual footwear businesses. * Apparel and accessories revenue decreased 11.7% to $102.7 million, driven by anticipated declines in Timberland brand apparel as a result of the Company`s transition to a licensing model for its North American wholesale business. Global footwear revenue increased 1.0% to $313.5 million driven by strength in Timberland PRO series footwear as well as strength in the boots business in the European and Asian markets, which offset declines in the men`s casual and outdoor performance categories. * Global wholesale revenue decreased 1.0% to $340.6 million. Worldwide consumer direct revenue decreased 6.9% to $83.0 million, reflecting a difficult worldwide retail environment and revenue declines associated with our decision to close certain retail locations. * Restructuring and related charges were $0.2 million in the third quarter of 2008, compared to $7.5 million for the third quarter of 2007. * Operating income for the quarter was $53.2 million, a 19.2% improvement from the prior-year period. Operating income excluding restructuring and related costs was $53.4 million, a 2.3% improvement compared to the prior year level. * In the third quarter of 2008, the effective tax rate was 40.0%, flat compared to the third quarter of 2007. * In connection with its stock buyback program, Timberland repurchased approximately 1.2 million shares in the third quarter at a total cost of $20.1 million. * Timberland ended the quarter with $62.7 million in cash and no debt. Inventory at quarter end was $218.9 million, down 15.6% versus 2007 third-quarter levels, reflecting the Company`s disciplined inventory management in the face of challenging market conditions. Accounts receivable decreased 6.8% to $267.2 million, compared to the prior year.More Timberland News...More Fashion News - United States Of America...12

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