November 15, 2004-- Home Textiles Today,
Hanover to Restate Finances
Catalog and Internet retailer Hanover Direct said the discovery by its audit committee of an accounting error will require the restatement of its financial statements for the fiscal years ended in late December 1999 through 2003.
Also to be restated are the financial results for quarters ended in March, June and September 2003 as well as the quarters ended in March and June 2004.
The error resulted from the accounting treatment of discount obligations due to members of some of the company's buyer's club programs for three of its catalogs since 1998. While the full impact is still being calculated, Hanover said it did result in the overstatement of revenues and the omission of the related liability for discount obligations for fiscal periods as early as 1998.
The retailer also announced that it is seeking permission from the Securities and Exchange Commission to extend the deadline for filing its quarterly report on Form 10-Q for the fiscal quarter ended Sept. 25, 2004, for up to five calendar days so that it may calculate the impact of restatement.
Neiman Marcus Sheds Chef's Catalog
The Neiman Marcus Group has sold its Chef's Catalog direct marketing business to Pikes Peak Direct Marketing Inc., a newly formed corporation controlled by private equity firm JH Partners LLC.
The retailer did not disclose the purchase price for the catalog, which has annual sales of $75 million — about 2 percent of the company's $3.55 billion in revenue. The company said it expects to post a pretax loss of $15 million to $17 million in its second quarter.
JH Partners LLC's portfolio includes Peet's Coffee & Tea, Performance Bicycle Shop, Bell Helmets, and Design Within Reach.
Saks Promotes Jennings, Frasch
Saks Fifth Avenue Enterprises last week announced it has appointed Andrew Jennings president and chief operating officer and Ron Frasch vice chairman and chief merchant of Saks Fifth Avenue.
Prior to joining Saks Fifth Avenue in February, Jennings was president and managing director of Holt Renfrew Specialty Store Group in Canada. He reports to Fred Wilson, chairman and chief executive officer of SFAE.
Ron Frasch joined Saks Incorporated in January to concentrate on the company's international opportunities and private brand development. Frasch was chairman and chief executive officer of Neiman Marcus Group's Bergdorf Goodman.
Kmart Chooses Plastic for Holidays
Kmart has launched a private label credit card that offers interest-free financing during the 2004 holiday season as well as purchasing discounts throughout the year.
The Kmart Rewards card program is being managed by HSBC, which also handles private label credit card programs for Best Buy, Saks Fifth Avenue and Levitz Furniture. The card carries no annual fee. It will marketed through in-store promotions as well as print and online advertising.
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