UPDATE 2-Signs of progress at Juicy Couture lift Fifth & Pacific

Thu Oct 25, 2012 2:58pm EDT

* Adjusted loss 5 cents/share vs Street view loss 7 cents

* Maintains 2012 adjusted EBITDA ex-currency forecast

* Q4 comp sales at Juicy to be up by mid-single-digit percentage

* Shares up 11.4 percent (Adds details from conference call, CEO comment, share activity)

By Phil Wahba

Oct 25 (Reuters) - Fashion company Fifth & Pacific Cos Inc on Thursday said sales at its struggling Juicy Couture brand are improving so far this quarter and gave an encouraging holiday sales forecast for all three of its major brands, sending its shares up 11.4 percent.

Fifth & Pacific also reported a narrower-than-expected quarterly loss on Thursday as its Lucky Brand and kate spade lines enjoyed strong sales, partially offsetting a 6 percent decline in sales last quarter at Juicy, its biggest brand.

Juicy, a once-hot brand known for its velour track suits with an urban look, has struggled to find favor again with U.S. shoppers.

But things are improving, the company said: comparable sales for the brand should be up by a mid-single digit percentage this quarter, which includes the Christmas period.

"Juicy Couture's re-stage is progressing," Chief Executive William McComb said on a conference call. "The brand has real chops with consumers."

Three weeks ago, the company slashed its profit forecast for 2012 because of a stalled turnaround at Juicy Couture, its largest brand by sales. That news had sent shares plummeting.

Sales at kate spade, its fast growing high end shoes and accessories brand that competes with Michael Kors Holdings Inc and Coach Inc, and Lucky Brand came in above what the company had reported on a preliminary basis on Oct. 1.

The company expects comparable sales during the holiday to be up by a mid-single digit percentage at Juicy and by as much as 29 percentage at kate spade.

Fifth & Pacific also outlined its plan to bring the kate spade brand to new markets next year, including Russia, Turkey and India.

Net sales last quarter fell 4.2 percent to $364.6 million. Fifth & Pacific, formerly known as Liz Claiborne Inc, has shed many brands in the past two years, including Claiborne, to lower its debt and focus on its three marquee brands.

Excluding businesses it still had a year earlier, sales rose 6.6 percent, fueled largely by gains at kate spade.

Comparable sales for kate spade were up 22 percent in the quarter, ended Sept. 29, and up 5 percent at Lucky Brand, both a percentage point higher than the company's preliminary results.

Fifth & Pacific reported a third-quarter net loss of $18.8 million, or 17 cents a share, compared with a year-earlier loss of $214.6 million, or $2.27 a share.

Excluding discontinued business and items such as currency fluctuations, the company had an adjusted loss of 5 cents per share, compared with earnings from continuing operations of 4 cents per share a year earlier. Analysts' average forecast was an adjusted loss of 7 cents a share, according to Thomson Reuters I/B/E/S.

Fifth & Pacific on Thursday stood by its lowered forecast for 2012 adjusted earnings of $100 million to $115 million excluding items such as interest, taxes, depreciation and amortization. (Reporting by Phil Wahba; Editing by Gerald E. McCormick, John Wallace and Bernard Orr)

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