LA Gear’s Sales Slump Sparks 4th-Quarter Loss of $29.8 Million
Disclosing that shoe sales slumped 24.6% in fiscal 1992, LA Gear on Friday reported losses of $29.8 million for the fourth quarter and $71.9 million for the year.
The Los Angeles-based shoe maker, controlled by Roy Disney’s Trefoil Capital Investors, has been struggling to move piles of unsold sneakers out of its warehouses. It said price-cutting, along with the lower sales volume, crushed revenue for the year by 30.5% to $430.2 million from $619.2 million.
That compares to sales over the last 12 months of about $3.7 billion at Nike Inc. and $3 billion at Reebok International Ltd., the giant rivals LA Gear once dreamed of catching.
LA Gear, a perennial favorite with short-sellers who bet stock prices will decline, saw its shares rise by 25 cents Friday, to $10.12 1/2, in afternoon trading on the New York Stock Exchange.
During its fourth quarter ended Nov. 30, LA Gear’s $1.39 per-share loss compared to a net loss of $38.3 million, or $2.04 per share, in the year-earlier period. Losses on continuing operations widened: Comparable year-earlier figures were $22.3 million, or $1.22 per share.
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