Co-President Of Troubled Liz Claiborne Unit Is Leaving

The co-president of Liz Claiborne Inc.'s (LIZ) troubled Juicy Couture unit is leaving the post after two months.

David Bassuk, who also served as chief operating officer at Juicy Couture, is going back to his prior employer, AlixPartners, which specializes in revitalizing businesses. Liz Claiborne Chief Executive Bill McComb announced the departure on a call with analysts to discuss the apparel company's fiscal first-quarter earnings.

McComb said Bassuk, who had consulted with Liz Claiborne before joining the company, would go back to that role. The company will see cost savings and efficiencies with Bassuk again serving as a consultant, McComb said. "While this is a bit unusual, it's a highly pragmatic move for Dave, AlixPartners and Juicy."

The company will not be naming a new co-president of Juicy Couture any time soon, McComb said. Bassuk shared the co-president title with LeAnn Nealz, who joined Liz Claiborne in late 2010.

At the time Bassuk joined Liz Claiborne in late February he said Juicy, which became famous for its velour track suits before falling out of favor, has the ability to make a comeback. McComb reiterated that sentiment during the earnings call, saying improvement should be seen in the second half of the year.

Juicy showed it was still struggling in the first quarter, with sales falling 4.4%, while Liz Claiborne's other two main units, Lucky Brand and Kate Spade, saw increases of 20% and 46%, respectively. With only a handful of brands after selling off many units, the performance of each remaining business is critical to the company's overall success.

For the first quarter, Liz Claiborne posted a narrower loss of $60.6 million, or 60 cents a share, compared with a loss of $96.3 million, or $1.02 a share, a year earlier. Adjusted loss from continuing operations narrowed to 22 cents from 32 cents. Sales dropped 4.1% to $317.1 million.

Gross margin rose to 56.5% from 53.3%. The company said it ended the quarter with net debt of $317 million, a decrease of $381 million compared with a year ago.

Liz Claiborne sold its namesake, Monet and Kensie fashion brands to department store operator J.C. Penney Co. (JCP) and sold the Dana Buchman brand to Kohl's Corp. (KSS). The Kensie brand went to Bluestar Alliance, a financial services and brand management company.

Last month, Standard & Poor's Ratings Services upgraded Liz Claiborne's credit junk-level rating, saying the recent asset sales helped reduce debt and it expected the company's profitability and cash flow generation to improve.

Liz Claiborne shares are up 4.7% to $13.26.

-By Karen Talley, Dow Jones Newswires; 212-416-2196; [e-mail]