Perry Ellis Conference Call Highlights

reported its third quarter earnings on Thursday. Shares of the company are up 2 percent. Below are some key highlights from its conference call.

• We substantially improved our operating income compared to last year and recorded an adjusted net gain of $0.03. • Compared to an adjusted loss of $0.15 in the prior year period. • A 5% revenue decline year-over-year is a result of our previously announced strategic decision to work with certain private label businesses. • Also impacting the quarter was the West - the West Coast ports congestion and ground transportation issues which delayed some shipments and resulted in the shifting of revenues into the fourth quarter. • We have made significant progress in many of our strategic initiatives and are reaffirming our gross objectives for the full year. • Our success this year, we've paved the way for larger commitments from retailers to allocate additional space and open to buy for such brands next year. • We are implementing a number of growth initiatives and internal operating improvements that would drive revenues and enhance profitability. • Including this plan is the expansion of direct-to-consumer licensing and international business. • We remain increasingly focused on our key brands and distribution channel mix. • We maintain our long-term objective of achieving above average EBITDA margins of 10%. • We would continue to open retail store because they give us the opportunity to showcase the lifestyle brand collections, creating brand visibility, awareness and in turn increasing brand loyalty. • Our immediate focus continues to be improve the profitability of the existing store base. • We expect to continue seeing increased earnings from our retail business as some of our poorly performing legacy stores leases expire. • Our direct-to-consumer Internet sales increased by 42% and our a third-party Internet sales together with direct-to-consumer represent now 5% of our total U.S. wholesale business. • Obviously, we see this as an area where we need to continue to invest and build our expertise in order to expand our direct-to-consumer base. • International development and expansion remain a key initiative of the company. • Our performance in Q3 validate both the strategy and the execution of this plan. • Internal operational recorded a 7% increase in net revenue. • Euro was a strong driver, reporting a 20% increase in net sales and perhaps more encouraging gross profit margin expanded further.

• Total debt at the end of the quarter is $172 million including mortgages of $22 million. • Excluding the mortgages and cash on hand, our net total debt is about $97 million or 2.4 times EBITDA. • I just want to point out that the management of this company which include the Feldenkreis family together with directors, employees and myself, control over 28% of outstanding shares and is obviously fully aligned with the stockholders and continue to work very hard to increase shareholder value. • We ask you to remember that this is the same management that was able to grow this company from a $33 million private label company into one with broader retail sales worldwide are in the area of $3 billion. • Reported adjusted net earnings per share of $0.03 and revenues of $211 million in line with our guidance range proposed. • First, there was logistics congestion in West Coast ports as well as challenges with demand for ground transportation. • As a result, approximately $6 million in goods that were scheduled to retailer pick up during the last week of the quarter were moved into the fourth quarter. • We also absorbed approximately $0.04 in negative foreign currency translation considerably driven by the spike in the U.S. dollar during September, which impacted the majority of global currency. • We are pleased with the positive trends in direct-to-consumer, especially given that overall comp traffic was down 2% for the quarter. • Licensing revenue totaled $8.2 million, an increase of 10% for the quarter. • Solid performance by existing licenses in Perry Ellis, Original Penguin, and Laundry coupled with the benefits in 20 new licenses signed during the year contributed to the encouraging results.