Maidenform Brands Earnings: Margins Suffer for Five Quarters Straight

Maidenform Brands Inc. (NYSE:MFB) reported its results for the second quarter. Maidenform Brands is a global intimate apparel company.

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Maidenform Brands Inc. Earnings Cheat Sheet

Results: Net income for Maidenform Brands Inc. fell to $11.4 million (49 cents per share) vs. $11.6 million (50 cents per share) a year earlier. This is a decline of 1.6% from the year-earlier quarter.

Revenue: Fell 7.4% to $157.5 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Maidenform Brands Inc. reported adjusted net income of 67 cents per share. By that measure, the company beat the mean estimate of 47 cents per share. It beat the average revenue estimate of $153.8 million.

Quoting Management: “Sales and earnings were at the top end of our expectations for the second quarter,” stated Maurice S. Reznik, Chief Executive Officer. “Gross margin improved 680 basis points since the first quarter of 2012, our inventory levels are down and we are poised for high single digit growth in sales and double digit growth in EPS in the second half. Continued weakness in Europe and a choppy domestic market are placing downward pressure on our outlook, however we continue to execute well against our strategies and we are excited about our upcoming new product launches and branding initiatives.”

Key Stats:

Last quarter was the fifth in a row that the company saw shrinking gross margins, as they fell 0.8 percentage point from the year-earlier quarter to 34%. Over that time, margins have contracted on average five percentage points per quarter on a year-over-year basis.

The company has beaten estiamtes for two quarters in a row. In the first quarter, it topped expectations with net income of 25 cents versus a mean estimate of net income of 24 cents per share.

Revenue has declined for two quarters in a row. In the first quarter, revenue declined 3.7% to $157.5 million from the year-earlier quarter.

Looking Forward: Analysts appear increasingly optimistic about the company’s results for the next quarter. The average estimate for the third quarter has moved up from 61 cents a share to 63 cents over the last ninety days. The average estimate for the fiscal year is $1.78 per share, down from $1.81 ninety days ago.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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