Losses up at Fruit of the Loom

FRUIT of the Loom, which employs 3,000 people in Derry and Donegal, has reported increased losses in 1995 as the fourth quarter came in the red.

"During the quarter, we saw a continuation of the downward trend in retail apparel sales that has plagued much of the apparel industry for several quarters," said chief executive, Mr William Farley.

"While our revenues were below plan, we were successful in reducing inventory by taking 25 manufacturing down days. The manufacturing down time negatively impacted on gross margins, adding approximately $25 million (£15.74 million) to our cost of goods sold," he said.

Fruit of the Loom, which manufactures underwear, sportswear and other apparel, had a fourth quarter loss of $308 million, or $4.05 a share, on revenues of $508.8 million. The fourth quarter included a larger than expected restructuring charge of $287.4 million, related to plant closings and acquisition costs.

In the Irish plants, 800 workers in Derry and Donegal were put on a three day week last October but returned to full working on January 2nd, a month ahead of schedule. The short time working had been introduced because stocks of T shirts and jogging shorts were higher than anticipated orders.

For the year, Fruit of the Loom lost $232.5 million on revenues of $2.4 billion. In 1994, it had a profit of $60.3 million on revenues of $2.29 billion.

"With these charges behind us and, hopefully, with a somewhat more vigorous retail environment ahead of us, we look forward to a rebound in operating results in 1996," Mr Farley said. He added that Fruit of the Loom does not anticipate a need for manufacturing down time in 1996.