USA -- Maidenform Brands, Inc., a global branded marketer of intimate apparel, reported second quarter 2009 net sales of $114.2 million, an increase of 5.6% over the second quarter of 2008, driven by continued strength in its core bra and shapewear businesses, replenishment of its Donna Karan and DKNY licensed brands, the introduction of new programs with off-price retailers and sales to a specialty retailer. Reported earnings per share (EPS) of $0.31 for the second quarter of 2009 were down as compared to EPS of $0.33 in the second quarter of 2008.

Maurice S. Reznik, Chief Executive Officer, stated, "We're very pleased with our results in the second quarter and for the year-to-date. We've differentiated ourselves from our competition with leadership and innovation in bras and shapewear and we continue to build penetration across all of our channels of distribution. While the marketplace and economy remain challenging, we're deeply focused on executing our strategies and investing in our business and infrastructure to further strengthen our company and drive continued market share growth through the balance of this year and forward."

Financial Results for Second Quarter 2009 versus Second Quarter 2008
Net sales for the second quarter of 2009 increased $6.1 million, or 5.6%, to $114.2 million. Wholesale segment net sales in the second quarter of 2009 increased $6.1 million, or 6.5%, to $99.7 million. Retail segment net sales were unchanged at $14.5 million in the second quarter of 2009.

The Company's net sales performance by channel of distribution is highlighted in Exhibit 1 to this press release.

Wholesale Segment
Department Stores and National Chain Stores
Net sales for the department stores and national chain stores channel decreased $1.0 million, or 1.7%, to $56.4 million in the second quarter of 2009. This decrease reflected the weakness in this channel as a result of the global economic slowdown, along with promotional activities with retail partners to increase inventory productivity and lost sales associated with customer bankruptcies filed in the second half of 2008. Partially offsetting this decrease were sales from the Company's licensed brands Donna Karan and DKNY that the Company launched in the first quarter of 2009.

Mass Merchants
Mass merchant channel net sales decreased $2.1 million, or 7.4%, to $26.4 million in the second quarter of 2009. Sales were impacted by a non-recurring program with a warehouse customer and lower private brand sales with one mass customer. Partially offsetting this decrease was the continued growth of Maidenform's Sweet Nothings and Inspirations(TM) brands in the shapewear and bra categories.

Other
Net sales in the other channel increased $9.2 million, or 119.5%, to $16.9 million in the second quarter of 2009 primarily from the replenishment of products based on the Company's patent-pending Total Solution(TM) technology with a specialty retailer and higher sales to off-price retailers.

Total international net sales, which are included in the wholesale segment, decreased $2.1 million, or 19.8%, to $8.5 million. International sales were adversely affected by currency exchange rates and lower sales in Russia.

Retail Segment
Total retail segment net sales were unchanged at $14.5 million in the second quarter of 2009 with same store sales down 6.4% at Maidenform's retail outlet stores. Internet sales remained unchanged at $1.2 million in the second quarter of 2009. Maidenform had 75 retail outlet stores as of the end of the second quarter of 2009 compared to 77 retail outlet stores in the same period of 2008.

As a percentage of net sales, consolidated gross margins were 36.0% versus 38.7% in the second quarter of 2008. The majority of the decrease was a result of increased promotional activity to drive inventory productivity, and the mix of customers and products, including a higher percentage of net sales from the Company's lower margin other channel.

Consolidated selling, general and administrative expenses (SG&A) increased $0.7 million, or 2.6%, to $28.0 million in the second quarter of 2009 largely due to expenses associated with the Company's licensed brands Donna Karan and DKNY , which were launched in early 2009, as well as higher compensation costs. These additional expenses were partially offset by managed cost reductions across most operating departments. As a percentage of net sales, SG&A declined 80 basis points to 24.5% in the second quarter of 2009 compared to 25.3% in the second quarter of 2008.

Due to all of the factors described above, operating income in the second quarter of 2009 was $13.1 million, or 11.5% of net sales, compared to $14.5 million, or 13.4% of net sales, in the second quarter of 2008.

Net interest expense in the second quarter of 2009 was $0.6 million compared to $1.1 million in the second quarter of 2008 as we benefited primarily from a lower average interest rate for the second quarter of 2009 when compared to the same period in 2008.

The Company's effective income tax rate for the second quarter of 2009 was 41.9% compared to 41.7% in the second quarter of 2008.

Net income for the second quarter of 2009 and 2008 was $7.3 million and $7.8 million, respectively, and EPS was $0.31 and $0.33, respectively.

For Financial Results for Year-To-Date 2009 versus Year-To-Date 2008 click here.
 
Maidenform Brands Inc