SOURCE: Joe's Jeans Inc.

Joe's Jeans Inc.

October 15, 2009 16:00 ET

Joe's Jeans Reports a 16% Increase in Third Quarter 2009 Net Sales

LOS ANGELES, CA--(Marketwire - October 15, 2009) - Joe's Jeans Inc. (the "Company") (NASDAQ: JOEZ) today announced financial results for the third quarter ended August 31, 2009. Highlights were:

--  Third quarter net sales increased 16% to $21.2 million
    
--  Gross margins remained steady at 49%
    
--  Operating income increased 22% to $2.8 million
    
--  Net income was $1.9 million with earnings per share of $0.03
    

For the third quarter, overall net sales were $21.2 million compared to overall net sales of $18.2 million from the prior year comparative period, a 16% increase. Marc Crossman, President and Chief Executive Officer, commented, "We are pleased with our performance for the quarter with essentially all of our distribution channels, namely domestic women's, domestic men's, licensing, and retail, experiencing sales increases."

Gross profit for the third quarter of fiscal 2009 was $10.4 million compared to $9.0 million, a 16% increase. For the third quarter of fiscal 2009, gross margins were consistent at 49%. SG&A expenses during the third quarter of fiscal 2009 were $7.4 million compared to $6.5 million in the third quarter of fiscal 2008, a 13% increase. Mr. Crossman continued, "We continue to manage effectively our expense structure while launching new product categories, rolling out our company owned retail stores, and investing in advertising and promoting the brand for long-term, sustainable growth. The increases in SG&A were largely limited to expenses associated with the retail stores we opened during the fourth quarter of fiscal 2008."

Mr. Crossman concluded, "These results translated into net income for the third quarter of fiscal 2009 of $1.9 million and earnings per share of $0.03. We had what we believe to be a very productive quarter which we will continue to build upon in the fourth quarter of 2009 and into 2010."

To access the live call, please dial (800) 299-6183 (U.S.) or (617) 801-9713 (International). The conference ID number and participant passcode is 79597733 and is entitled the "Q3 2009 Joe's Jeans Inc. Earnings Conference Call." The information provided on the teleconference is only accurate at the time of the conference call, and the Company will take no responsibility for providing updated information. A telephone replay of the conference call will be available beginning at 7:30 p.m. Eastern Time on October 15, 2009 until 11:59 p.m. Eastern Time on October 22, 2009 by dialing (888) 286-8010 (U.S) or (617) 801-6888 (international) and using the conference passcode 69535207. In addition, the conference call will be archived for two weeks on the Company's website at www.joesjeans.com.

                    JOE'S JEANS INC. AND SUBSIDIARIES
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                  (in thousands, except per share data)


                                                      Three months ended
                                                  -------------------------
                                                   August 31,   August 31,
                                                      2009         2008
                                                  ------------ ------------
                                                         (unaudited)
Net sales                                         $     21,238 $     18,248
Cost of goods sold                                      10,864        9,303
                                                  ------------ ------------
   Gross profit                                         10,374        8,945
                                                  ------------ ------------

Operating expenses
   Selling, general and administrative                   7,394        6,544
   Depreciation and amortization                           132           70
                                                  ------------ ------------
                                                         7,526        6,614
                                                  ------------ ------------
Operating income                                         2,848        2,331
   Interest expense                                         90          133
                                                  ------------ ------------
Income before provision for taxes                        2,758        2,198
   Income taxes                                            824          368
                                                  ------------ ------------
Net income                                        $      1,934 $      1,830
                                                  ============ ============

Earnings per common share - basic                 $       0.03 $       0.03
                                                  ============ ============

Earnings per common share - diluted               $       0.03 $       0.03
                                                  ============ ============

Weighted average shares outstanding
   Basic                                                60,177       59,477
   Diluted                                              61,462       60,063

About Joe's Jeans Inc.

Joe's Jeans Inc. designs, produces and sells apparel and apparel-related products to the retail and premium markets under the Joe's® brand and related trademarks. More information is available at the company website at www.joesjeans.com.

This release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. The matters discussed in this news release involve estimates, projections, goals, forecasts, assumptions, risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. All statements in this news release that are not purely historical facts are forward-looking statements, including statements containing the words "intend," "believe," "estimate," "project," "expect" or similar expressions. Any forward-looking statement inherently involves risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to: the risk that the Company will be unsuccessful in gauging fashion trends and changing customer preferences; the risk that changes in general economic conditions, consumer confidence, or consumer spending patterns will have a negative impact on the Company's financial performance or strategies; the highly competitive nature of the Company's business in the United States and internationally and its dependence on consumer spending patterns, which are influenced by numerous other factors; the Company's ability to respond to the business environment and fashion trends; continued acceptance of the Joe's® brand in the marketplace; successful implementation of any growth or strategic plans; effective inventory management; the Company's ability to continue to have access on favorable terms to sufficient sources of liquidity necessary to fund ongoing cash requirements of its operations, which access may be adversely impacted by a number of factors, including the reduced availability of credit generally and the substantial tightening of the credit markets, including lending by financial institutions, who are sources of credit for the Company, the recent increase in the cost of capital, the level of the Company's cash flows, which will be impacted by the level of consumer spending and retailer and consumer acceptance of its products; the ability to generate positive cash flow from operations; competitive factors, including the possibility of major customers sourcing product overseas in competition with our products; the risk that acts or omissions by the company's third party vendors could have a negative impact on the company's reputation; a possible oversupply of denim in the marketplace; and other risks. The Company discusses certain of these factors more fully in its additional filings with the SEC, including its last annual report on Form 10-K filed with the SEC, and this release should be read in conjunction with that annual report on Form 10-K, together with all of the Company's other filings, including current reports on Form 8-K, made with the SEC through the date of this release. The Company urges you to consider all of these risks, uncertainties and other factors carefully in evaluating the forward-looking statements contained in this release.

Any forward-looking statement is based on information current as of the date of this document and speaks only as of the date on which such statement is made, and the Company undertakes no obligation to update these statements to reflect events or circumstances after the date on which such statement is made. Readers are cautioned not to place undue reliance on forward-looking statements.

Contact Information

  • Contact:
    Joe's Jeans Inc.
    Hamish Sandhu
    323-837-3700 x 304