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K-Swiss Losses Widen Amid Brand Awareness Effort

Athletic apparel company K-Swiss Inc. widened its net loss for the fourth quarter and the 2010 fiscal year when compared to the same periods from a year ago. The Westlake Village-based firm reported a net loss of $20.6 million, or $058 per diluted share, on revenue of $42.6 million for the quarter ending Dec. 31. For the same period in 2009, the company had a net loss of $12.5 million, or $0.36 per diluted share, on revenues of $42 million. For the 2010 fiscal year, K-Swiss had a net loss of $68.2 million, or $1.94 per diluted share, on revenues of $217 million. For the 2009 fiscal year, the company had a net loss of $28 million, or $0.80 per diluted share, on revenues of $240.7 million. K-Swiss management used 2010 as a year in which to invest in and reposition its brand and to market its new Tubes and Blade lines to a youth customer base. Long known for its Classic, the white leather tennis show introduced in the 1960s, K-Swiss now offers running and training shoes to make up in sales what the tennis line can no longer bring in. The commitment to brand awareness at all costs is showing results in the positive swing in future orders, said company Chairman and President Steven Nichols. Worldwide futures orders to be shipped from January through June 2011 increased to $92.9 million from the same period a year earlier. Domestic orders increased to $45.2 million by Dec. 31 from $29.6 million from the previous year. Sales Up for DineEquity Sales increased for DineEquity Inc.’s Applebee’s Neighborhood Grill & Bar and IHOP restaurants, the Glendale-based company announced. DineEquity, parent company of the two restaurant chains, made the announcement as a preview of its earnings for the fourth quarter and full 2010 fiscal year ending Dec. 31. Applebee’s domestic system-wide same-restaurant sales increased 2.9 percent for the fourth quarter of 2010 compared to the same period in 2009. The improvement was primarily due to ongoing marketing and operational initiatives, as well as menu enhancements. For the fourth quarter, Applebee’s company-operated restaurants experienced a higher average guest check, partially offset by a decline in guest traffic compared to the same period in 2009. For the full fiscal year, Applebee’s domestic system-wide same-restaurant sales increased 0.3 percent compared to the same period in 2009. IHOP domestic system-wide same-restaurant sales increased 1.1 percent for the fourth quarter of 2010 compared to the same period in 2009. The improvement was primarily due to the limited-time offer Fall Festival, along with the promotion of Trick or Treat All-You-Can-Eat Pancakes. IHOP’s same-restaurant sales results for the fourth quarter also reflected a higher average guest check offset by a decline in guest traffic. For the full fiscal year, IHOP’s domestic system-wide same-restaurant sales were flat compared to the same period in 2009. DineEquity also announced it is proposing a re-pricing its term loan facility in order to take advantage of lower interest rates available in the current senior secured debt market. Catalogue Sales Help Image Stronger catalogue sales contributed to Image Entertainment Inc. posting net income for the third quarter compared to the net loss from the same period a year ago. Earnings for the Chatsworth-based distributor and producer of home entertainment programming were also helped by inclusion of results from a distributor it acquired in the fall. For the quarter ending Dec. 31, Image posted net income of $2.2 million, or $0.01 per diluted share, on revenues of $27.7 million. For the same period in 2009, the company had a net loss of $2.1 million, or $0.09 per diluted share, on revenues of $25.1 million. In October, Image bought a majority share in Madacy Home Video, a leading independent distributor of audio and video entertainment that includes classic television, horror, theatrical as well as numerous special interest titles. “The inclusion of Madacy’s library as well as a very strong performance of Image catalog product afforded us an increase in revenues for this quarter,” said Image Chairman and CEO Ted Green. “We are very pleased with the results and look forward to maintaining the momentum.” Net Loss for On Assignment Staffing services firm On Assignment widened its net loss in the fourth quarter when compared to the previous year. The Calabasas-based company reported a net loss of $13.7 million, or $0.38 per diluted share, on revenues of $121.2 million for the quarter ending Dec. 31. For the same period in 2009, On Assignment reported net income of $1.5 million, or $0.03 per diluted share, on revenues of $99.9 million. For the full fiscal year, On Assignment reported a net loss of $9.9 million, or $0.27 per diluted share, on revenues of $438 million. For the previous fiscal year, the company reported net income of $4.7 million, or $0.13 per diluted share, on revenues of $416.6 million. The information technology and engineering segment brought in the most revenues for the year at $178,688, followed by life sciences ($109,495), health care ($76,287) and physician staffing ($73,595). In the fourth quarter, On Assignment signed a deal to acquire one of the largest privately owned clinical staffing firms in Western Europe, which brought in $20 million in revenue in 2010. Testing services boosts Trio-Tech Earnings Trio-Tech International had higher earnings and revenue for its second quarter of fiscal year 2011 compared to the same quarter a year ago due to stronger product sales and better performance in its testing services and real estate segments. For the fiscal quarter ending Dec. 31, the company had net income of $187,000, or $0.05 per diluted share, on revenue of $9.5 million. That shows improvement from the same quarter the previous year when the company had a net loss of $369,000, or $0.11 per share, on revenue of $6.2 million. Revenue from product sales increased to $5.5 million for the second quarter of fiscal year 2011, up from $3.1 million for the same period the previous year. The increase was primarily the result of higher sales of the company’s proprietary semiconductor test equipment products. The company’s testing services revenue increased to $3.2 million for the most recent second quarter, up from $2.6 million for the second quarter of fiscal year 2010. Revenue from the company’s real estate segment increased to $772,000, up from $260,000 the year before. Meanwhile, the company’s oil and gas equipment fabrication revenue decreased to $93,000 for the most recent second quarter, down from $200,000 the year before. “We are making steady progress in the implementation of our two-pronged strategy for growth,” said S.W. Yong, Trio-Tech’s CEO. “Our core semiconductor test equipment and services business posted another strong quarter, and our financial results also benefited substantially from developments at one our new business initiatives, real estate, that are a key element of our long-term growth plan.” During the second quarter of fiscal year 2011, Trio-Tech completed the expansion of its Malaysia testing operation, which included the purchase of additional plant and equipment. The expansion was made in order to grow the company’s production capacity in anticipation of capturing increased order volume from a major customer. Rental Income Increases for PS Business Parks PS Business Parks Inc. had higher revenues but lower net income for the fourth quarter and full year of 2010, the Glendale-based equity real estate investment trust announced. For the fourth quarter of 2010 that ended Dec. 31, the company had net income of $8.4 million, or $0.34 per diluted share, on revenues of $71.4 million. For the same period in 2009, the company had net income of $9.9 million, or $0.40 per diluted share, on revenues of $67.7 million. For the full year of 2010 that ended Dec. 31, the company had net income of $39 million, or $1.58 per diluted share, on revenues of $279.1 million. For the full year of 2009, the company had net income of $59.4 million, or $2.68 per diluted share, on revenues of $271.7 million. Higher revenues for the fourth quarter in 2010 were a result of rental income from acquired properties of $6.4 million, partially offset by a decrease in revenues from the company’s same park portfolio of $2.7 million. That decrease was primarily due to a decrease in rental rate. The drop for the fourth quarter in net income was primarily due to non-cash distributions of $1.6 million related to the preferred equity redemption during that quarter combined with increases in depreciation expense and acquisition transaction costs. Those decreases were partially offset by an increase in net operating income and a reduction of preferred equity cash distributions as a result of preferred equity redemptions in 2010.

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