Third Quarter Accomplishments

Improvement in cash flow, primarily due to better terms with vendors;

SG&A expenses decreased 33% to $9.7 million from $14.4 million in the third quarter 2008, reflecting a portion of the estimated $13.1 million in annualized savings resulting from the Company's restructuring and cost reduction plans;

Negotiated the renewal of the licensing agreement with Geoffrey Beene® for three years for the design, production and distribution of men's sweaters under the Geoffrey Beene® brand;

Positive consumer response to initial launches of JOE Joseph Abboud® and Alexander Julian Colours®

Reorganized management of women's businesses with appointment of Howard L. Zwilling as President of Women's Apparel

Operating Results

Net sales decreased 37.2% to $50.9 million for the three months ended September 26, 2009 from $81.0 million for the same period last year. For the nine months ended September 26, 2009, net sales decreased by 34.3% to $100.9 million from $153.6 million for the same period last year. The decrease in net sales resulted from a decline in volume, principally in the Company's women's businesses and lower average selling prices due to larger customer allowances, both reflective of the weak retail market and the impact of customers that filed for bankruptcy during 2008.

In the third quarter, the Company had a loss from operations of $1.0 million compared to operating income of $2.1 million for the same period last year. For the nine month period ended September 26, 2009, the Company's loss from operations was $17.0 million compared to $9.1 million for the same period last year. The increase in the loss from operations for both the three-month and nine-month periods was primarily the result of decreased net sales, increased customer allowances, restructuring and tender offer related costs and was somewhat offset by reduced selling, general and administrative expenses from the prior year.

Excluding restructuring, special and tender offer related costs, income from operations was $1.3 million and $3.6 million for three months ended September 26, 2009 and September 27, 2008, respectively. The loss from operations excluding non-operational restructuring, special and tender offer related costs, was $7.1 million and $6.2 million for the nine month periods ended September 26, 2009 and September 27, 2008, respectively.

Basic and diluted loss per share from continuing operations for the quarter ended September 26, 2009 was $0.10, compared to income of $0.44 for the same period last year.