Question-and-Answer Session
Operator
(Operator instructions) Our first question is coming from Todd Slater. Please go ahead, sir.
Todd Slater – Lazard Freres & Co.
Thanks very much and good evening. Congratulations, everyone.
Joe Gromek
Thanks, Todd.
Todd Slater – Lazard Freres & Co.
Just starting with the guidance both on the revenue and EPS, with ForEx benefit obviously on all the flowing through the whole quarter, how much of the ForEx benefit or detriment have you assumed in your annual number for the next three quarters on the EPS and revenue line?
Larry Rutkowski
Well, Todd, this is Larry. In terms of ForEx benefits, we picked up $27 million of benefit in the first quarter. In the remainder of the year, we also currently are projecting that there is a benefit given where the euro is currently trading and also some improvements in select other currencies, the Canadian dollar and also the RMB. In terms of that, we are projecting a sizable improvement in the rest of the year so that we are continuing to show this type of benefit in future half of the year or slightly more than that. Does that help?
Todd Slater – Lazard Freres & Co.
So, this type of benefit in each of the next three quarters?
Larry Rutkowski
No, not in each, be careful. We are showing slightly more than the $27 million that we have shown in the first quarter in the remaining three quarters of the year.
Todd Slater – Lazard Freres & Co.
I see. So, clearly less going forward on a quarter?
Larry Rutkowski
For each quarter, that is correct.
Todd Slater – Lazard Freres & Co.
Much less, okay. And then, could you just go over a little bit what the annual tax rate looks like now with the NOLs, remind us how big the NOL is and how that impacts the P&L? Thanks.
Larry Rutkowski
Sure. The NOL at the end of the year was $339 million. One of the things we mentioned is that we had a one-time charge regarding the repatriation of Lejaby proceeds back in the first quarter. If you put that aside, our continuing tax rate, we are expecting to remain in that 26%, 27% on a normalized basis.
Todd Slater – Lazard Freres & Co.
Okay. And then I just have a quick question for Helen and congratulations to you too especially. 5000 more fixtures at retail and profitably 410 basis point increase in operating income it sounds like in the core intimates fees. Could you talk a little bit more about the story there and are we approaching the upside in door penetration or sort of what the annualized operating margin potential is there looking forward? Thank you.
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