NEW YORK — Tarrant Apparel Group reported a significantly narrowed fourth-quarter loss on Thursday, and for the full year swung to a profit from a loss a year ago.
Also on Thursday, the company said its chief executive officer and president, Barry Aved, resigned his ceo title, effective Friday, in order to focus on building the firm’s American Rag Cie brand with Macy’s. Aved will relocate to New York and will be replaced on an interim basis by Tarrant chairman Gerard Guez.
In the three months ended Dec. 31, the Los Angeles-based company posted a loss of $1.5 million, or 5 cents a share, which compared with a loss of $29.1 million, or $1.01, last year. Results in the most recent quarter included a $1.2 million write-off of prepaid minimum royalty related to the license termination in March of the House of Deréon by Tina Knowles brand.
Quarterly net sales rose 35.4 percent to $49.7 million. The company cited strong sales from its private brand, which had an increase of about 30 percent to $9.6 million, and its private label business, which saw sales rise 37 percent to $40.1 million.
Tarrant said the quarter’s results were negatively impacted by the discontinuation of its Gear 7 line at Kmart, Charming Shoppes Inc.’s decision not to continue with the JS by Jessica Simpson brand and the termination of the House of Deréon license.
In the year, Tarrant swung to a net profit of $993,000, or 3 cents, compared with a loss of $104.7 million, or $3.64, a year ago. Net sales rose 38.1 percent to $214.7 million.
Results in the year “signal a significant turnaround for the company,” Aved said in a statement Thursday.
Shares of Tarrant plunged 13.2 percent to $1.25 on the Nasdaq on Friday, the first full day of trading since the company announced earnings shortly before the close of the market on Thursday.