APPAREL
|
PERRY ELLIS INTERNATIONAL, INC., AND SUBSIDIARIES* |
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|
2009 |
2008 |
2007 |
|
|
Revenues |
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|
Net sales |
$825,868 |
$838,465 |
$807,616 |
|
Royalty income |
25,429 |
25,401 |
22,226 |
|
Total revenues |
851,297 |
863,866 |
829,842 |
|
Cost of sales |
573,046 |
572,232 |
554,046 |
|
Gross profit |
278,251 |
291,634 |
275,796 |
|
Operating expenses |
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|
Selling, general, and administrative expenses |
236,840 |
215,873 |
204,883 |
|
Depreciation and amortization |
14,784 |
13,278 |
11,608 |
|
Impairment on longlived assets |
22,299 |
— |
— |
|
Total operating expenses |
273,923 |
229,151 |
216,491 |
|
Operating income |
4,328 |
62,483 |
59,305 |
|
Costs on early extinguishment of debt |
— |
— |
2,963 |
|
Impairment on marketable securities |
2,797 |
— |
— |
|
Interest expense |
17,491 |
17,594 |
21,114 |
|
(Loss) income before minority interest and income tax provision |
15,960 |
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|
Minority interest |
612 |
44,889 |
35,228 |
|
Income tax (benefit) provision |
3,682 |
931 |
508 |
|
Net (loss) income |
($12,890) |
15,785 |
12,311 |
|
Net (loss) income per share |
$28,173 |
$22,409 |
|
|
Basic |
($0.89) |
$1.92 |
$1.55 |
|
Diluted |
($0.89) |
$1.80 |
$ 1,45 |
|
Weighted average number of shares outstanding |
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|
Basic |
14,416 |
14,675 |
14,504 |
|
Diluted |
14,416 |
14,657 |
15,455 |
|
See footnotes to consolidated financial statements. |
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PERRY ELLIS INTERNATIONAL, INC. AND SUBSIDIARIES
FOOTNOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In Part)
FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED JANUARY 31, 2009
2. Summary of Significant Accounting Policies (In Part)
The following is a summary of the Company’s significant accounting policies:
PRINCIPLES OF CONSOLIDATION—The consolidated financial statements include the accounts of Perry Ellis International, Inc., and its whollyowned and controlled subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. The ownership interest in consolidated subsidiaries of noncontrolling shareholders is reflected as minority interest. The Company’s consolidation principles would also consolidate any entity in which the Company would be deemed a primary beneficiary.
USE OF ESTIMATES—The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts in the consolidated financial statements and the accompanying footnotes. Actual results could differ from those estimates.
Required
a. 1. Comment on the principles of consolidation.
2. Does it appear that there is a 100% ownership in all consolidated subsidiaries?
b. Comment on the use of estimates.
c. Would you expect an impairment in marketable securities?
d. What type of ‘‘special item’’ would be costs on early extinguishment debt?