Elizabeth Arden’s Net Loss Widens in First

Beauty products maker Elizabeth Arden Inc. reported that its first-quarter net loss widened even though net sales more than doubled. The Miami based-company, which changed its name from French Fragrances after it acquired the Elizabeth Arden business in January, reported a net loss of $19.0 million, or $1.15 per share, compared with a net loss of $9.9 million, or 74 cents per share, on a pro forma basis a year earlier.

For the three months ended April 28, net sales more than doubled, to $142.0 million from $65.7 million a year earlier. The increase reflected the acquisition of the Elizabeth Arden business, offset somewhat by weakness in the retail sales environment, the company said. In a statement, Scott Beattie, chairman, president and chief executive officer, said the company expects fiscal 2002 net sales of $840 million to $870 million, EBITDA (earnings before interest, taxes, depreciation and amortization) of $125 million to $140 million, and diluted earnings per share of $1.55 to $1.75.

The company said EBITDA for the first quarter was a loss of $10 million, compared with a profit of $6.7 million a year earlier. First-quarter EBITDA reflected lower gross margins on sales of Elizabeth Arden product owned prior to the acquisition, and administrative costs paid to the Unilever Group, former owner of the Elizabeth Arden business, for the provision of transitional services. The company previously said the Arden acquisition would add significantly to fiscal 2002 earnings but would be dilutive to earnings per share in the first two quarters of the year.