The Wall Street Journal-20080215-Liz Claiborne Cuts Projected Earnings

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Liz Claiborne Cuts Projected Earnings

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Apparel-maker Liz Claiborne Inc. lowered its earnings outlook, stung by higher product markdowns, retailer cancellations and aggressive liquidation of excess inventories.

Liz Claiborne, which has been jettisoning many of its brands to focus on fewer product lines, said it was selling its Ellen Tracy brand to an investor group for as much as $42.3 million.

In addition, the company said it would complete its strategic review of its brands by the end of March, and it postponed its Feb. 27 quarterly report. The company plans to hold an earnings conference call no later than March 13.

Liz Claiborne said it expects to post a 2007 loss of from 25 cents to 35 cents a share. Excluding restructuring charges and other special items, the company said it would earn from $1.25 to $1.35 a share, down from its prior outlook of $1.70 to $1.80.

Shares fell 18% to $18.31 in 4 p.m. New York Stock Exchange composite trading.

Last month the company hired designer Isaac Mizrahi to revamp its Liz Claiborne women's line.

In positive news, sales rose 25% at Liz Claiborne's Juicy Couture stores that had been open for at least one year.