Commenting on the results, Jim Riedman, Phoenix Footwear's Chairman and CEO, said, "2006 was an important year for Phoenix as we addressed several significant challenges which we believe pave the way for improved performance. We aggressively dealt with excess inventory levels, reducing our footwear inventory by over 300,000 pair or approximately 40% year-over-year. Additionally, we completely repositioned the Tommy Bahama Footwear brand and launched a new Spring 2007 line."
"We now have product with world class design and quality, which is being shipped to major national retailers, including Nordstrom and Macy's. During the fourth quarter we also began reinvesting in our H.S. Trask brand and started updating and redesigning the product line. Finally, we rationalized many of our third party sourcing relationships, opened up a second foreign sourcing office and started consolidating our distribution facilities."
"While these efforts suppressed our margins in the later half of 2006 we believe they provide the basis for improving our operating results in 2007 and beyond. Mr. Riedman continued, "The final two initiatives on which we are presently focused, are the strengthening of our balance sheet and complementing our management team with the addition of a new CEO. We are making progress on both these fronts and hope to report further details in the coming months."
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