Exhibit
99.1
FOR IMMEDIATE RELEASE:
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CONTACTS: |
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Blair Corporation
Larry Pitorak, CFO & CAO
814-723-3600
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Carl Hymans
G.S. Schwartz & Co
212-725-4500
carlh@schwartz.com |
BLAIR CORPORATION REPORTS FIRST QUARTER RESULTS
WARREN,
Pa., (April 17, 2007) — Blair Corporation (Amex: BL),
(www.blair.com), a national
multi-channel direct marketer of women’s and men’s apparel and home products, today announced
results for the first quarter ended March 31, 2007.
Net sales for the first quarter ended March 31, 2007 were $76.1 million, a decrease of 25.9%,
compared to the $102.7 million reported for the first quarter ended March 31, 2006.
The Company had expected net sales for the first quarter of 2007 to be below first quarter
2006 net sales as a result of planned reductions in catalog circulation. The first quarter 2007
results were 14.8% below the Company’s expectations for the period. The decline in first quarter
2007 net sales was a result of lower customer demand and slow response to spring apparel.
Additionally, fulfillment difficulties resulting from the start-up of a new warehouse management
software system adversely impacted net sales. Unit sales volume for the first quarter of 2007
declined 27.6% from first quarter 2006 levels. This volume decline was partially offset by a 1.7%
increase in average selling prices. The reduction in catalog circulation levels and slow response
rates also impacted E-commerce sales. E-commerce net sales for the first quarter of 2007 were
$17.8 million, a 28.2% decline from the $24.8 million recorded in the first quarter of 2006.
The Company reported a net loss of $5.1 million, or $1.35 per basic and diluted share for the first
quarter of 2007, compared to a net loss of $4.8 million or $1.23 per basic and diluted share
reported for the first quarter of 2006.
Cost of goods sold as a percentage of net sales for the first quarter of 2007 declined to
45.8%, compared to 46.7% for the first quarter of 2006. This improvement in cost of goods sold as
a percent of net sales was the result of continued efforts to reduce the cost of merchandise
through increased direct sourcing by the Company. Advertising expenses for the first quarter of
2007 were $10.3 million lower than for the first quarter of 2006, a 33% decline in costs. This
decline in advertising costs was the result of planned reductions in catalog circulation
implemented to garner greater selling expense efficiencies. General and administrative expenses
for the first quarter of 2007 were $3.9 million lower than the comparable quarter of 2006,
primarily due to restructurings which occurred in 2006. The Company continues to restructure its
workforce to meet the changing requirements of its business. In
the first quarter of 2007, the Company recorded $249,000 of severance expense compared to $1.5
million of severance expense recorded in the first quarter of 2006.
The first quarter of 2007 severance expense is associated with the previously disclosed
closing of Blair’s leased Returns Center in Erie, Pa. and movement of all returns operations to the
Blair Distribution Complex in Irvine, Pa. The closing was announced in the fourth quarter of 2006
and the move completed in March 2007.
In June 2006, the Company began a credit program where it absorbed any bad debt on credit
issued to specified Blair customers that would otherwise not be eligible under the Blair Credit
program. First quarter 2007 results include a provision for doubtful accounts of approximately
$1.5 million associated with these Blair credit sales. During the first quarter of 2007, the
Company recorded $524,000 of rent related expenses associated with the closing of the above
mentioned leased Returns Center in Erie, Pa. First quarter 2007 results were also impacted by
approximately $975,000 of expenses incurred relative to its announced pending merger transaction
with Appleseed’s Topco, Inc.
In connection with the proposed merger and related transactions, Blair Corporation has filed a
definitive proxy statement with the Securities and Exchange Commission. Blair stockholders are
urged to read the definitive proxy statement carefully, because it contains important information.
Stockholders are able to obtain a copy of the proxy statement and other documents containing
information about Blair Corporation, free of charge, at the SEC’s Web site at www.sec.gov. In
addition, copies of the proxy statement are available free of charge on the investor relations
portion of the Blair Corporation Web site at www.blair.com, and may also be obtained by writing
Blair Corporation’s investor relations department, at 220 Hickory Street, Warren, PA 16366, or by
calling Georgeson Inc. at (866) 229-8451. Blair Corporation and its respective directors and
executive officers and other members of management and employees may be deemed to be participants
in the solicitation of proxies from Blair Corporation’s stockholders in respect of the proposed
transaction. Information regarding Blair Corporation’s directors and executive officers and their
ownership of Blair securities is set forth in the definitive proxy statement. Further information
regarding persons who may be deemed participants, including any direct or indirect interests they
may have, is also set forth in the definitive proxy statement filed on March 21, 2007.
ABOUT BLAIR
Headquartered in Warren, Pennsylvania, Blair Corporation sells a broad range of women’s and
men’s apparel and home products through direct mail marketing and its Web site www.blair.com.
Blair Corporation employs approximately 1,900 associates (worldwide) and operates facilities and
retail outlets in Northwestern Pennsylvania as well as a catalog outlet in Wilmington, Delaware.
The Company, which has annual sales of approximately $425 million, is publicly traded on the
American Stock Exchange (Amex: BL).
This release contains certain statements, including without limitation, statements containing the
words “believe,” “plan,” “expect,” “anticipate,” “strive,” and words of similar import relating to
future results of the Company (including certain projections and business trends) that are
“forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995.
Actual results may differ materially from those projected as a result of certain risks and
uncertainties, including but not limited to, changes in political and economic conditions, demand
for and market acceptance of new and existing products, as well as other risks and uncertainties
detailed in the most recent periodic filings of the Company with the Securities and Exchange
Commission.
