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Kate Spade & Company Reports 2nd Quarter And First Half 2014 Results

- Reports Q2 2014 Kate Spade direct to consumer comparable sales growth of 30%, contributing to an increase of full year 2014 direct to consumer comparable sales growth guidance to a range of 15% to 17%

NEW YORK, Aug. 12, 2014 /PRNewswire/ -- Kate Spade & Company (NYSE: KATE) today announced results for the second quarter ended July 5, 2014.

The Company is separating its former Kate Spade reportable segment into two reportable segments, Kate Spade North America and Kate Spade International. The Company's Adelington Design Group operating segment is also a reportable segment. Please refer to the item captioned "Presentation of Segments" for more information. As the Company has substantially completed the wind-down of the Juicy Couture business, Juicy Couture is now reported as discontinued operations. Therefore, results from continuing operations exclude Juicy Couture and Lucky Brand.

For the second quarter of 2014 on a GAAP basis, loss from continuing operations, was ($14) million, or ($0.11) per share, compared to a loss from continuing operations of ($24) million, or ($0.20) per share, for the second quarter of 2013.

Net sales for the second quarter of 2014, were $266 million, an increase of $87 million, or 48.7%, from the comparable 2013 period. Adjusted earnings per share from continuing operations for the second quarter of 2014 was $0.05, compared to adjusted loss per share of ($0.08) for the second quarter of 2013.

Adjusted EBITDA, net of foreign currency transaction adjustments, was $32 million for the second quarter of 2014, compared to $7 million for the second quarter of 2013. Comparable Adjusted EBITDA, net of foreign currency transaction adjustments, was $11 million for the second quarter of 2013.

For the first half of 2014, the Company recorded a loss from continuing operations of ($52) million, or ($0.42) per share, compared to a loss from continuing operations for the first half of 2013 of ($47) million, or ($0.40) per share. Net sales for the first half of 2014 were $490 million, an increase of $154 million, or 46.0%, from the comparable 2013 period, including an $18 million benefit associated with the additional week in 2014. Adjusted earnings per share from continuing operations in the first half of 2014 was $0.01 compared to an adjusted loss per share from continuing operations of ($0.18) in the first half of 2013. Adjusted EBITDA, net of foreign currency transaction adjustments, was $49 million for the first half of 2014, compared to $11 million for the first half of 2013. Comparable Adjusted EBITDA, net of foreign currency transaction adjustments, was $18 million for the first half of 2013.

Craig A. Leavitt, Chief Executive Officer of Kate Spade & Company, said: "Despite a more promotional retail environment, Kate Spade & Company had another strong quarter, with sales increases coming across both our North American and International segments. Adjusted EBITDA for Kate Spade & Company, net of foreign currency transaction adjustments, was $32 million for the second quarter of 2014, a $21 million increase compared to the second quarter of 2013. In addition, we achieved comparable store productivity of $1,477 per square foot over the last twelve months, our 16th consecutive quarter of annualized store productivity growth. We are increasing Total Company full year 2014 Adjusted EBITDA guidance to a range of $120 million - $130 million from the previously guided range of $115 million - $125 million."

Mr. Leavitt concluded: "Net sales for both our North American and International segments grew 55% and 54%, respectively, illustrating that our differentiated product resonates with consumers around the world.   We have a clear vision of our customer and continue to design strong collections as we shape our fast-growing, global lifestyle brand."

George Carrara, President and Chief Operating Officer of Kate Spade & Company, said: "We are pleased with our outperformance.  Since completing the transition to our newly integrated organization this quarter, our team is able to cohesively manage our initiatives in a more streamlined, effective way.  Currently, we are conducting our annual business planning process and are actively pursuing both existing and newly identified margin expansion opportunities."

The adjusted results for the second quarter 2014 and 2013, as well as forward-looking targets, exclude the impact of expenses incurred in connection with the Company's streamlining initiatives, brand-exiting activities, acquisition related costs, losses on extinguishment of debt, impairment of cost investment in 2013 and non-cash write-offs of debt issuance costs. The Company believes that the adjusted results for such periods represent a more meaningful presentation of its historical operations and financial performance since these results provide period to period comparisons that are consistent and more easily understood. The attached tables, captioned "Reconciliation of Non-GAAP Financial Information," provide a full reconciliation of actual results to the adjusted results. We present Adjusted EBITDA, which we define as income (loss) from continuing operations, adjusted to exclude income tax provision, interest expense, net, depreciation and amortization, net, losses on extinguishment of debt, expenses incurred in connection with the Company's streamlining initiatives, brand-exiting activities, acquisition related costs, non-cash impairment charges, losses on asset disposals and non-cash share-based compensation expense. We also present Adjusted EBITDA, net of foreign currency transaction adjustments, which is Adjusted EBITDA further adjusted to exclude unrealized and certain realized foreign currency transaction adjustments, net. We also present Comparable Adjusted results (including Comparable Adjusted SG&A expense and operating income (loss)), which we use to measure our performance after giving effect to certain corporate cost savings. Comparable Adjusted SG&A, operating income (loss) and EBITDA are calculated by starting with adjusted results (which already exclude charges related to streamlining initiatives, brand-exiting activities and acquisition related costs) and includes adjustments to reflect the anticipated impact resulting from the Juicy Couture and Lucky Brand divestitures to show 2013 on a comparable basis to 2014. The annualized Corporate Adjusted EBITDA of ($53) million is consistent with our previously provided 2014 guidance for Corporate Adjusted EBITDA of ($50) to ($55) million, which includes estimated amounts to be billed under the Transition Services Agreement (TSA) for Lucky Brand and assumes ownership of Lucky Brand by the Company for the month of January 2014, followed by the implementation of the TSA for a period of up to 24 months thereafter. We present the above-described Adjusted EBITDA measures because we consider them important supplemental measures of our performance and believe they are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry.

The Company will sponsor a conference call at 10:00am Eastern time today to discuss its results for the second quarter of 2014. The dial-in number is 1-888-694-4676 with pass code 79282758. The webcast and slides accompanying the prepared remarks can be accessed via the Investor Relations section of the Kate Spade & Company website at www.katespadeandcompany.com. An archive of the webcast will be available on the website. Additional information on the results of the Company's operations is available in the Company's Form 10-Q for the second quarter 2014, to be filed with the Securities and Exchange Commission. 

SECOND QUARTER RESULTS

Presentation of Segments

During the second quarter of 2014, the Company determined it would disaggregate its former Kate Spade reportable segment into two reportable segments, Kate Spade North America and Kate Spade International. The Company operates its kate spade new york, Kate Spade Saturday and Jack Spade brands through one operating segment in North America and four operating segments internationally, Japan, Southeast Asia, Europe and South America. The Company's Adelington Design Group reportable segment is also an operating segment. As such, the Company configured its operations into the following three reportable segments:

  • Kate Spade North America segment – consists of the Company's kate spade new york, Kate Spade Saturday and Jack Spade brands in North America.
  • Kate Spade International segment – consists of the Company's kate spade new york, Kate Spade Saturday and Jack Spade brands in International markets (principally in Japan, Southeast Asia, Europe and South America).
  • Adelington Design Group segment – consists of: (i) exclusive arrangements to supply jewelry for the Liz Claiborne and Monet brands; (ii) the wholesale non-apparel operations of the Trifari brand and licensed Kensie brand; (iii) the wholesale apparel and wholesale non-apparel operations of the licensed Lizwear brand and other brands; and (iv) the licensed Liz Claiborne New York brand.

Adjusted EBITDA

Our CEO evaluates performance and allocates resources based primarily on Segment Adjusted EBITDA.  Segment Adjusted EBITDA excludes: (i) depreciation and amortization; (ii) charges due to streamlining initiatives, brand-exiting activities and acquisition related costs; and (iii) losses on asset disposals and impairments. In connection with the decision to disaggregate the Company's reportable segments, the cost of all corporate departments that serve the respective operating segments are fully allocated. We do not allocate amounts reported below Operating income (loss) to our reportable segments, other than equity income (loss) in our equity method investee. Our definition of Segment Adjusted EBITDA may not be comparable to similarly titled measures of other companies.

Overall Results

Net sales from continuing operations for the second quarter of 2014 were $266 million, an increase of $87 million, or 48.7% from the second quarter of 2013, reflecting increases in the Kate Spade North America and Kate Spade International segments, partially offset by decreases in net sales within our Adelington Design Group segment.

Gross profit as a percentage of net sales decreased to 58.6% in the second quarter of 2014, compared to 61.8% in the comparable 2013 period, reflecting the impact of off-price sales margin, primarily driven by the Kate Spade Saturday brand, due to excess inventory and raw materials disposal that arose in connection with balancing consumer demand with inventory buys in the launch year.

Selling, general & administrative expenses ("SG&A") increased $32 million, or 27.8%, to $146 million in the second quarter of 2014 compared to the second quarter of 2013. The increase in SG&A reflected the following:

  • A $19 million increase in SG&A in our Kate Spade North America segment, primarily related to direct-to-consumer expansion reflecting: (i) increased rent and other store operating expenses; (ii) increased compensation related expenses; and (iii) increased e-commerce fees and advertising expenses;
  • A $13 million increase in SG&A in our Kate Spade International segment, primarily related to direct-to-consumer expansion reflecting: (i) increased compensation related expenses; (ii) increased rent, concession fees and other store operating expenses; and (iii) increased advertising expenses. The increase also included incremental SG&A associated with the KATE SPADE businesses in Southeast Asia;
  • A $3 million increase in expenses associated with our streamlining initiatives, brand-exiting activities and acquisition-related costs; and
  • A $2 million decrease associated with reduced costs at our Adelington Design Group segment.

SG&A for the second quarter of 2014 included a $1 million decrease in expenses related principally to distribution functions that were included in the Juicy Couture and Lucky Brand historical results, but are not directly attributable to Juicy Couture or Lucky Brand and therefore, have not been included in discontinued operations.

SG&A as a percentage of net sales was 54.9% in the second quarter of 2014, compared to 63.9% in the second quarter of 2013.

Operating Income was $10 million (3.7% of net sales) in the second quarter of 2014 compared to operating loss of ($4) million ((2.1%) of net sales) in the second quarter of 2013.

Other Income (Expense), net was $0.2 million in the second quarter of 2014, compared to ($0.8) million in the second quarter of 2013, and included foreign currency transaction gains and losses and equity in (losses) earnings of our equity investee.

Loss on Extinguishment of Debt was ($17) million in the second quarter of 2014 and related to the refinancing of the Senior Notes.

Impairment of Cost Investment was ($6) million in the second quarter of 2013, related to the former investment in the Mexx business.

Interest expense, net decreased to $6 million in the second quarter of 2014, compared to $12 million in the second quarter of 2013, primarily reflecting (i) the recognition of $3 million of interest income in 2014 from the Note Receivable related to the sale of Lucky Brand Dungarees, Inc.; (ii) a net decrease of $3 million in interest expense related to the Senior Notes and Term Loan which was issued in the second quarter of 2014 to refinance the Senior Notes; (iii) a $2 million write-off of deferred financing fees in the second quarter of 2014 due to a reduction in the size of our Amended Facility; and (iv) a decrease of $1 million related to the Amended Facility and the extinguishment of the Convertible Notes.

Provision for Income Taxes was $1 million in the second quarter of 2014 and 2013 and consisted primarily of increases in deferred tax liabilities for indefinite-lived intangible assets, current tax on operations in certain jurisdictions and an increase in the accrual for interest related to uncertain tax positions.

Loss from Continuing Operations in the second quarter of 2014 was ($14) million, or ($0.11) per diluted share, compared to a loss of ($24) million, or ($0.20) per share in the second quarter of 2013. Adjusted earnings per share from continuing operations in the second quarter of 2014 was $0.05, compared to adjusted loss per share of ($0.08) in the second quarter of 2013.

Net loss in the second quarter of 2014 was ($4) million, inclusive of income related to discontinued operations of $10 million, compared to net loss of ($43) million, inclusive of a loss related to discontinued operations of ($20) million in the second quarter of 2013. Net loss per share was ($0.03) in the second quarter of 2014, compared to a loss per share of ($0.36) in the second quarter of 2013.

Balance Sheet and Cash Flow

Accounts Receivable decreased $20 million, or 21.4%, at the end of the second quarter 2014 compared to the second quarter 2013, primarily due to the sale of the Lucky Brand business and the wind-down of the Juicy Couture operations, partially offset by an increase in Kate Spade accounts receivable due to increased wholesale sales.

Inventories decreased $60 million, or 25.2% at the end of the second quarter 2014 compared to the second quarter 2013, primarily due the sale of the Lucky Brand business and the wind-down of the Juicy Couture operations, partially offset by an increase in Kate Spade inventory to support growth initiatives and to support the transition of certain Juicy Couture stores to Kate Spade stores.

Cash flow used in continuing operating activities for the last 12 months was ($39) million.

Debt outstanding decreased to $409 million compared to $490 million in the second quarter 2013. We ended the second quarter of 2014 with $177 million in cash and cash equivalents and marketable securities, compared to $9 million at the end of the second quarter of 2013. The $249 million decrease in our net debt position over the last twelve months primarily reflected: (i) the receipt of net proceeds of $332 million from the dispositions of the Juicy Couture IP, Lucky Brand and our former investment in Mexx; (ii) the funding of $86 million of capital and in-store shop expenditures over the last 12 months; (iii) the receipt of proceeds of $43 million from the exercise of stock options; (iv) the payment of $32 million for the acquisition of the existing Kate Spade business in Southeast Asia from Globalluxe; (v) the generation of $22 million in cash from other activities of our discontinued operations over the past 12 months; and (vi) the receipt of net proceeds of $20 million from the sale-leaseback of our Ohio facility. We also used $39 million of cash from continuing operations over the past 12 months.

Performance Highlights

Total Kate Spade comparable direct-to-consumer net sales, including e-commerce, increased by 30.4% in the second quarter of 2014; excluding e-commerce net sales, comparable direct-to-consumer net sales increased by 31.6%. Sales per square foot for comparable stores for the latest twelve months were $1,477.

Net sales and Segment Adjusted EBITDA for our reportable segments are provided below:

Kate Spade North America

Net sales for Kate Spade North America were $208 million, a 54.6% increase compared to 2013, driven primarily by increases in kate spade new york.

Store counts and key operating metrics are as follows:

—    We ended the quarter with 96 specialty retail stores and 51 outlet stores, reflecting the net addition over the last 12 months of 27 specialty retail stores and 18 outlet stores;  and
—  Average retail square footage in the second quarter of 2014 was approximately 295 thousand square feet, a 47.8% increase compared to 2013.

Kate Spade North America Segment Adjusted EBITDA in the second quarter of 2014 was $32 million (15.5% of net sales), compared to Segment Adjusted EBITDA of $8 million (6.2% of net sales) in the second quarter of 2013. Comparable Adjusted EBITDA was $12 million (8.7% of net sales) in the second quarter of 2013.

Kate Spade International

Net sales for Kate Spade International were $49 million, a 53.6% increase compared to 2013, reflecting increases across all operations in the segment.

Store counts and key operating metrics are as follows:

—    We ended the quarter with 39 specialty retail stores, 11 outlet stores and 48 concessions, reflecting the net addition over the last 12 months of 5 specialty retail stores, 1 outlet store and 7 concessions and the acquisition of 6 specialty retail stores, 1 outlet store and 2 concessions; and
—  Average retail square footage in the second quarter of 2014 was approximately 93 thousand square feet, a 35.9% increase compared to 2013.

Kate Spade International Segment Adjusted EBITDA was flat in the second quarter of 2014, compared to Segment Adjusted EBITDA of ($0.7) million ((2.1% of net sales) in the second quarter of 2013. Comparable Adjusted EBITDA was flat in the second quarter of 2013.

Adelington Design Group

Net sales for the Adelington Design Group segment decreased $4 million, or 30.6%, in the second quarter of 2014 to $8 million, reflecting:

—   A net $2 million decrease related to the Liz Claiborne New York and private label jewelry businesses; and
—   A $2 million decrease due to the expiration of our former Dana Buchman brand supplier agreement.

Adelington Design Group Segment Adjusted EBITDA in the second quarter was $0.4 million (4.6% of net sales), compared to Segment Adjusted EBITDA of $1 million (8.6% of net sales) in the second quarter of 2013. Comparable Adjusted EBITDA was $1 million (10.1% of net sales) in the second quarter of 2013.

About Kate Spade & Company

Kate Spade & Company (NYSE: KATE) designs and markets accessories and apparel under three global, multichannel lifestyle brands: kate spade new york, Kate Spade Saturday and Jack Spade. With collections spanning demographics, genders and geographies, the brands are intended to accent customers' interesting lives and inspire adventure at each turn. The Company also owns the Adelington Design Group, a private brand jewelry design and development group that markets brands through department stores and serves jcpenney via exclusive supplier agreements for the Liz Claiborne and Monet jewelry lines. The Company also has a license for the Liz Claiborne New York brand, available at QVC, and Lizwear, which is distributed through the club store channel.  Visit www.katespadeandcompany.com for more information. 

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Statements contained in, or incorporated by reference into, this press release, future filings by us with the Securities and Exchange Commission, our Form 10-Q, and oral statements made by, or with the approval of, our authorized personnel, that relate to our future performance or future events are forward-looking statements under the Private Securities Litigation Reform Act of 1995. Such statements are indicated by words or phrases such as "intend," "anticipate," "plan," "estimate," "target," "aim," "forecast," "project," "expect," "believe," "we are optimistic that we can," "current visibility indicates that we forecast," "contemplation" or "currently envisions" and similar phrases. Although we believe that the expectations reflected in these forward-looking statements are reasonable, these expectations may not prove to be correct or we may not achieve the financial results, savings or other benefits anticipated in the forward-looking statements. These forward-looking statements are necessarily estimates reflecting the best judgment of our senior management and involve a number of risks and uncertainties, some of which may be beyond our control, that could cause actual results to differ materially from those suggested by the forward-looking statements, including, without limitation: our ability to complete the transition to a mono-brand business centered on the KATE SPADE family of brands, including our ability to successfully complete the transition of our management and operations; our ability to operate as a mono-brand business and to successfully implement our long-term strategic plans; general economic conditions in the United States, Asia, Europe and other parts of the world; levels of consumer confidence, consumer spending and purchases of discretionary items, including fashion apparel and related products, such as ours; changes in the cost of raw materials, occupancy, labor, advertising and transportation which could impact prices of our products; our ability to expand into markets outside of the US, such as India, Russia, Southeast Asia, and South America, as well as continued expansion in China, Japan and Brazil, including our ability to promote brand awareness in our international markets, find suitable partners in certain of those markets and hire and retain key employees for those markets; issues related to our current level of debt, including an inability to pursue certain business strategies because of the restrictive covenants in the agreements governing our debt and our potential inability to obtain the capital resources needed to operate and grow our business; restrictions in the credit and capital markets, which would impair our ability to access additional sources of liquidity, if needed; our ability to maintain targeted profit margins and levels of promotional activity; our ability to achieve the business plan for our KATE SPADE SATURDAY business, including our ability to attract new customers and achieve margin targets; our ability to expand our retail footprint with profitable store locations; our ability to implement operational improvements and realize economies of scale in finished product and raw material costs in connection with growth in our business; our ability to expand the KATE SPADE family of brands into new product categories; our ability to successfully implement our marketing initiatives; risks associated with the sale of the Lucky Brand business, including collection of the full amount of principal and interest due and owing pursuant to a three year note issued by Lucky Brand Dungarees, LLC, an affiliate of Leonard Green & Partners, L.P., to us as partial consideration for the purchase of the Lucky Brand business and compliance with our transition service requirements; risks associated with the sale of the Juicy Couture intellectual property to Authentic Brands Group, including our ability to complete the transition plan for the Juicy Couture business in a satisfactory manner and to manage the remaining associated transition costs, the impact of the transition plan and the announced future plans for the Juicy Couture brand on our relationships with our employees, our major customers, vendors and landlords and unanticipated expenses and charges that may occur as a result of the transition plan and the announced future plans for the Juicy Couture brand, such as litigation risks, including litigation regarding employment and workers' compensation; our dependence on a limited number of large US department store customers, and the risk of consolidations, restructurings, bankruptcies and other ownership changes in the retail industry and financial difficulties at our larger department store customers; whether we will be successful operating the KATE SPADE businesses in Japan and Southeast Asia and the risks associated with such operations, including with respect to the conclusion of transition services provided by our former operating partners; risks associated with decreased diversification of our business as a result of the reduction of our brand portfolio to the KATE SPADE and Adelington Design Group businesses; risks associated with material disruptions in our information technology systems, both owned and licensed, and with our third party e-commerce platforms and operations; risks associated with data security, including privacy breaches; risks associated with credit card fraud and identity theft;  our ability to anticipate and respond to constantly changing consumer demands and tastes and fashion trends, across multiple brands, product lines, shopping channels and geographies; our ability to attract and retain talented, highly qualified executives, and maintain satisfactory relationships with our employees; our ability to adequately establish, defend and protect our trademarks and other proprietary rights; risks associated with the dependence of our Adelington Design Group business on third party arrangements and partners; the impact of the highly competitive nature of the markets within which we operate, both within the US and abroad; our reliance on independent foreign manufacturers, including the risk of their failure to comply with safety standards or our policies regarding labor practices; risks associated with our buying/sourcing agreement with Li & Fung Limited, which results in a single third party foreign buying/sourcing agent for a significant portion of our products; risks associated with our arrangement to operate our leased Ohio distribution facility with a third party operations and labor management company that provides distribution operations services, including risks related to increased operating expenses, systems capabilities and operating under a third party arrangement; a variety of legal, regulatory, political and economic risks, including risks related to the importation and exportation of product, tariffs and other trade barriers; our ability to adapt to and compete effectively in the current quota environment in which general quota has expired on apparel products, but political activity seeking to re-impose quota has been initiated or threatened; our exposure to currency fluctuations; risks associated with third party service providers, both domestic and overseas, including service providers in the area of e-commerce; limitations on our ability to utilize all or a portion of our US deferred tax assets if we experience an "ownership change"; and the outcome of current and future litigation and other proceedings in which we are involved. The list of factors above is illustrative, but by no means exhaustive. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. All subsequent written and oral forward-looking statements concerning the matters addressed in this press release and attributable to us or any person acting on our behalf are qualified by these cautionary statements. Forward-looking statements are based on current expectations only and are not guarantees of future performance, and are subject to certain risks, uncertainties and assumptions, including those described in this press release, and in the Company's Annual Report on Form 10-K for the year ended December 28, 2013, filed with the SEC, and Quarterly Report on Form 10-Q for the quarterly period ended July 5, 2014, to be filed with the SEC, including in the sections entitled "Item 1A-Risk Factors" and "Statement on Forward Looking Statements." We may change our intentions, beliefs or expectations at any time and without notice, based upon any change in our assumptions or otherwise. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. In addition, some factors are beyond our control. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

KATE SPADE & COMPANY


CONSOLIDATED STATEMENTS OF OPERATIONS


(All amounts in thousands, except per common share data)





















Three Months Ended





Three Months Ended









July 5, 2014


% of


June 29, 2013


% of






 (13 Weeks) 


 Sales 


 (13 Weeks) 


 Sales 
















Net Sales



$                        265,998


100.0  %



$                         178,881


100.0  %



Cost of goods sold


110,088


41.4  %



68,403


38.2  %



Gross Profit



155,910


58.6  %



110,478


61.8  %



Selling, general & administrative expenses

145,982


54.9  %



114,245


63.9  %



Operating Income (Loss)


9,928


3.7  %



(3,767)


(2.1) %



Other income (expense), net

241


0.1  %



(832)


(0.5) %



Impairment of cost investment

-


-



(6,109)


(3.4) %



Loss on extinguishment of debt

(16,914)


(6.4) %



-


-



Interest expense, net


(6,474)


(2.4) %



(11,544)


(6.5) %



Loss Before Provision for Income Taxes

(13,219)


(5.0) %



(22,252)


(12.4) %



Provision for income taxes

764


0.3  %



1,336


0.7  %



Loss from Continuing Operations

(13,983)


(5.3) %



(23,588)


(13.2) %



Discontinued operations, net of income taxes

9,579





(19,549)





Net Loss



$                          (4,404)





$                         (43,137)



















Loss per Share:












Basic and Diluted













Loss from Continuing Operations 

$                            (0.11)





$                             (0.20)






Net Loss



$                            (0.03)





$                             (0.36)















































Weighted Average Shares, Basic and Diluted (a)

126,664





120,013





_______________












(a)

Because the Company incurred a loss from continuing operations for the three months ended July 5, 2014 and June 29, 2013, all potentially dilutive shares are antidilutive.  Accordingly, basic and diluted weighted average shares outstanding are equal for such periods.
















 

KATE SPADE & COMPANY


CONSOLIDATED STATEMENTS OF OPERATIONS


(All amounts in thousands, except per common share data)





















Six Months Ended





Six Months Ended









July 5, 2014


% of


June 29, 2013


% of






 (27 Weeks) 


 Sales 


 (26 Weeks) 


 Sales 
















Net Sales



$                        489,612


100.0  %



$                         335,330


100.0  %



Cost of goods sold


196,879


40.2  %



126,756


37.8  %



Gross Profit



292,733


59.8  %



208,574


62.2  %



Selling, general & administrative expenses

309,732


63.3  %



220,199


65.7  %



Operating Loss


(16,999)


(3.5) %



(11,625)


(3.5) %



Other income (expense), net

88


-



(2,702)


(0.8) %



Impairment of cost investment

-


-



(6,109)


(1.8) %



Loss on extinguishment of debt

(16,914)


(3.5) %



(1,108)


(0.3) %



Interest expense, net


(15,996)


(3.3) %



(23,760)


(7.1) %



Loss Before Provision for Income Taxes

(49,821)


(10.2) %



(45,304)


(13.5) %



Provision for income taxes

2,570


0.5  %



2,030


0.6  %



Loss from Continuing Operations

(52,391)


(10.7) %



(47,334)


(14.1) %



Discontinued operations, net of income taxes

94,157





(47,977)





Net Income (Loss)


$                          41,766





$                         (95,311)



















(Loss) Earnings per Share:











Basic and Diluted













Loss from Continuing Operations 

$                            (0.42)





$                             (0.40)






Net Income (Loss)


$                              0.33





$                             (0.80)















































Weighted Average Shares, Basic and Diluted (a)

125,491





119,523





_______________












(a)

Because the Company incurred a loss from continuing operations for the six months ended July 5, 2014 and June 29, 2013, all potentially dilutive shares are antidilutive.  Accordingly, basic and diluted weighted average shares outstanding are equal for such periods.
















 

KATE SPADE & COMPANY


CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME 


(All amounts in thousands)




















Three Months Ended


Six Months Ended







July 5, 2014


June 29, 2013


July 5, 2014


June 29, 2013







 (13 Weeks) 


 (13 Weeks) 


(27 Weeks)


(26 Weeks)
















Net (Loss) Income 


$                        (4,404)


$                      (43,137)


$                        41,766


$                      (95,311)
















Other Comprehensive (Loss) Income, Net of Income Taxes:










  Cumulative translation adjustment, net of income taxes of $0

(197)


(3,383)


1,488


(7,928)



    Change in fair value of cash flow hedges, net of income taxes of $(217), $333,
    $(449) and $621, respectively

(352)


542


(732)


1,013



Comprehensive (Loss) Income

$                        (4,953)


$                      (45,978)


$                        42,522


$                    (102,226)















 

KATE SPADE & COMPANY

CONSOLIDATED BALANCE SHEETS

(All amounts in thousands)















July 5, 2014


June 29, 2013



Assets









Current Assets:








     Cash and cash equivalents

$                        177,132


$                            9,155




     Accounts receivable - trade, net

71,814


91,350




     Inventories, net

178,234


238,390




     Other current assets

39,854


53,670




     Total current assets

467,034


392,565













Property and Equipment, Net

165,578


236,232




Goodwill


72,458


52,147




Intangibles, Net


94,478


126,999




Note Receivable

86,724


-




Other Assets


35,837


38,241



Total Assets


$                        922,109


$                        846,184












Liabilities and Stockholders' Equity (Deficit)







Current Liabilities:







     Short-term borrowings

$                            6,434


$                          90,002




     Convertible Senior Notes

-


8,269




     Other current liabilities

268,948


358,894




     Total current liabilities

275,382


457,165













Long-Term Debt

402,415


391,746




Other Non-Current Liabilities

166,781


210,951




Stockholders' Equity (Deficit)

77,531


(213,678)



Total Liabilities and Stockholders' Equity (Deficit)

$                        922,109


$                        846,184


 

KATE SPADE & COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(All amounts in thousands)

















Six Months Ended








July 5, 2014


June 29, 2013








(27 Weeks)


(26 Weeks)













Cash Flows from Operating Activities:







Net income (loss) 

$                           41,766


$                         (95,311)




Adjustments to arrive at loss from continuing operations

(94,157)


47,977




Loss from continuing operations

(52,391)


(47,334)














Adjustments to reconcile loss from continuing operations to net cash







       used in operating activities:








Depreciation and amortization

26,422


18,437





Loss on asset disposals and impairments, including streamlining initiatives, net

2,536


7,436





Share-based compensation

26,032


2,344





Loss on extinguishment of debt

16,914


1,108





Foreign currency (gains) losses, net

(1,301)


7,738





Other, net

173


629




Changes in assets and liabilities:








(Increase) decrease in accounts receivable - trade, net

(886)


17,055





Increase in inventories, net

(36,463)


(19,430)





Increase in other current and non-current assets

(7,042)


(4,586)





Decrease in accounts payable

(11,748)


(5,402)





Decrease in accrued expenses and other non-current liabilities

(25,062)


(32,712)





Net change in income tax assets and liabilities

3,818


1,136




Net cash provided by (used in) operating activities of discontinued operations

12,750


(30,738)





Net cash used in operating activities

(46,248)


(84,319)













Cash Flows from Investing Activities:







Purchases of property and equipment

(44,708)


(28,751)




Payments for in-store merchandise shops

(3,294)


(1,175)




Payments for purchases of businesses

(32,268)


-




Investments in and advances to equity investee

-


(3,000)




Other, net



(33)


(46)




Net cash provided by (used in) investing activities of discontinued operations

136,408


(20,982)





Net cash provided by (used in) investing activities

56,105


(53,954)













Cash Flows from Financing Activities:







Proceeds from borrowings under revolving credit agreement 

3,871


298,886




Repayment of borrowings under revolving credit agreement

(4,960)


(211,260)




Proceeds from sale-leaseback

-


8,673




Principal payments under capital lease obligations

(199)


(2,458)




Proceeds from issuance of Term Loan

398,000


-




Repayment of Senior Notes

(390,693)


-




Proceeds from exercise of stock options

40,128


1,498




Payment of deferred financing fees 

(7,978)


(4,436)





Net cash provided by financing activities

38,169


90,903













Effect of Exchange Rate Changes on Cash and Cash Equivalents

(1,116)


(2,877)













Net Change in Cash and Cash Equivalents

46,910


(50,247)



Cash and Cash Equivalents at Beginning of Period 

130,222


59,402



Cash and Cash Equivalents at End of Period

$                         177,132


$                             9,155


 

KATE SPADE & COMPANY

SEGMENT REPORTING

(All amounts in thousands)





































Segment


% of









 Net Sales 


Adjusted EBITDA (a)


 Sales 


Three Months Ended July 5, 2014 (13 Weeks)










     KATE SPADE North America




$  208,382


$    32,240


15.5  %


     KATE SPADE International (b)




49,231


(48)


(0.1) %


     Adelington Design Group 




8,385


382


4.6  %


     Other (c)






-


(531)


-


          Total - Reportable Segments



$  265,998




























Segment


% of









 Net Sales 


Adjusted EBITDA (a)


 Sales 


Three Months Ended June 29, 2013 (13 Weeks)









     KATE SPADE North America




$  134,749


$      8,337


6.2  %


     KATE SPADE International (b)




32,046


(661)


(2.1) %


     Adelington Design Group 




12,086


1,041


8.6  %


     Other (c)






-


(1,382)


-


          Total - Reportable Segments



$  178,881




























 Segment 


% of









 Net Sales 


Adjusted EBITDA (a)


 Sales 


Six Months Ended July 5, 2014 (27 Weeks)










     KATE SPADE North America




$  372,135


$    48,484


13.0  %


     KATE SPADE International (b)




102,606


1,427


1.4  %


     Adelington Design Group 




14,871


(10)


(0.1) %


     Other (c)






-


(595)


-


          Total - Reportable Segments



$  489,612




























 Segment 


% of









 Net Sales 


Adjusted EBITDA (a)


 Sales 


Six Months Ended June 29, 2013 (26 Weeks)










     KATE SPADE North America




$  239,205


$    10,297


4.3  %


     KATE SPADE International (b)




68,553


52


0.1  %


     Adelington Design Group 




27,572


4,077


14.8  %


     Other (c)






-


(2,682)


-


          Total - Reportable Segments



$  335,330






_______________












(a) 

Segment Adjusted EBITDA excludes: (i) depreciation and amortization; (ii) charges due to streamlining initiatives, brand-exiting activities and acquisition related costs; and (iii) losses on asset disposals and impairments.  In connection with the decision to disaggregate the Company's reportable segments, the costs of all corporate departments that serve the respective segment are fully allocated. The Company does not allocate amounts reported below Operating income/loss to its reportable segments, other than equity income (loss) in its equity method investee. Refer to the table entitled "Reconciliation of Non-GAAP Financial Information" for further information.


(b)

Amounts include equity in the earnings (losses) of equity method investee of $125 and $(292) for the three months ended July 5, 2014 and June 29, 2013, respectively, and $(173) and $(562) for the six months ended July 5, 2014 and June 29, 2013, respectively. 


(c)

Other consists of expenses principally related to distribution functions that were included in Juicy Couture and Lucky Brand historical results, but are not directly attributable to those businesses and therefore have not been included in discontinued operations. 

 

KATE SPADE & COMPANY

RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION

(All amounts in thousands)

(Unaudited)














The following table provides reconciliations of Segment Adjusted EBITDA to: (i) Adjusted EBITDA, Net of Foreign Currency Transaction Adjustments; and (ii) Loss from Continuing Operations. 


















Three Months Ended


Six Months Ended






July 5, 2014


June 29, 2013


July 5, 2014


June 29, 2013






(13 Weeks)


(13 Weeks)


(27 Weeks)


(26 Weeks)


























Segment Adjusted EBITDA:










   KATE SPADE North America


$                           32,240


$                         8,337


$                  48,484


$                  10,297


   KATE SPADE International


(48)


(661)


1,427


52


   Adelington Design Group


382


1,041


(10)


4,077


   Other (a)



(531)


(1,382)


(595)


(2,682)


Total Reportable Segments Adjusted EBITDA


32,043


7,335


49,306


11,744


Other income (expense) (b)


116


(540)


261


(2,140)


Less: Foreign currency transaction adjustments, net


(71)


131


(364)


1,235


Adjusted EBITDA, Net of Foreign Currency Transaction Adjustments


32,088


6,926


49,203


10,839














Foreign currency transaction adjustments, net


71


(131)


364


(1,235)


Depreciation and amortization, net (c)


(11,144)


(7,545)


(22,281)


(15,685)


Charges due to streamlining initiatives, brand-exiting activities, acquisition related
costs and loss on asset disposals and impairments, net 


(5,038)


(2,656)


(18,165)


(5,902)



Share-based compensation (d)


(5,808)


(1,193)


(26,032)


(2,344)


Loss on extinguishment of debt


(16,914)


-


(16,914)


(1,108)


Impairment of cost investment


-


(6,109)


-


(6,109)


Interest expense, net


(6,474)


(11,544)


(15,996)


(23,760)


Provision for income taxes


764


1,336


2,570


2,030


Loss from Continuing Operations 


$                          (13,983)


$                     (23,588)


$                (52,391)


$                 (47,334)


























Adjusted EBITDA, Net of Foreign Currency Transaction Adjustments




$                         6,926




$                  10,839


Corporate Adjustments (e)




3,789




7,658


Comparable Adjusted EBITDA, Net of Foreign Currency Transaction Adjustments




$                       10,715




$                  18,497














_______________























(a)

Other consists of expenses principally related to distribution functions that were included in Juicy Couture and Lucky Brand historical results, but are not directly attributable to those businesses and therefore have not been included in discontinued operations. 


(b)

Amounts do not include equity in the (income) losses of the Company's equity method investee of $(125), $292, $173 and $562 for the three and six months ended July 5, 2014 and June 29, 2013, respectively.


(c)

Excludes amortization included in Interest expense, net. 


(d)

Includes share-based compensation expense of $0.6 million and $16.9 million in the three and six months ended July 5, 2014, respectively, that was classified as restructuring.


(e)

Represents adjustments to reflect Corporate Costs on an annualized Adjusted EBITDA basis of $(53) million.













 

KATE SPADE & COMPANY

RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION

(All amounts in thousands, except per common share data)

(Unaudited)














The following tables provide reconciliations of (i) Loss from Continuing Operations to Adjusted Income (Loss) from Continuing Operations (a)and (ii) Operating Income (Loss) to Adjusted Income (Loss) from Continuing Operations (a)


















Three Months Ended


Six Months Ended






July 5, 2014


June 29, 2013


July 5, 2014


June 29, 2013






(13 Weeks)


(13 Weeks)


(27 Weeks)


(26 Weeks)














Loss from Continuing Operations


$                       (13,983)


$                       (23,588)


$                       (52,391)


$                       (47,334)


Streamlining initiatives, brand-exiting activities and acquisition related
   costs (b)


5,044


2,539


33,990


5,605


Impairment of cost investment


-


6,109


-


6,109


Write-off of debt issuance costs (c)


3,004


-


3,004


-


Loss on extinguishment of debt


16,914


-


16,914


1,108


(Provision) benefit for income taxes


(4,589)


5,401


(404)


13,266


Adjusted Income (Loss) from Continuing Operations (a)


$                          6,390


$                         (9,539)


$                          1,113


$                       (21,246)


























Operating Income (Loss) 


$                          9,928


$                         (3,767)


$                       (16,999)


$                       (11,625)


Streamlining initiatives, brand-exiting activities and acquisition related
   costs (b)


5,044


2,539


33,990


5,605


Write-off of debt issuance costs included in Selling, general &
   administrative expenses (d)


702


-


702


-


Adjusted Operating Income (Loss) (a)


15,674


(1,228)


17,693


(6,020)












-


Adjusted interest expense, net (e)


(4,172)


(11,544)


(13,694)


(23,760)


Other income (expense), net


241


(832)


88


(2,702)


Provision (benefit) for income taxes (f)


5,353


(4,065)


2,974


(11,236)














Adjusted Income (Loss) from Continuing Operations (a)


$                          6,390


$                         (9,539)


$                          1,113


$                       (21,246)














Adjusted Basic Earnings per Common Share from
     Continuing Operations (a)(g)


$                            0.05


$                           (0.08)


$                            0.01


$                           (0.18)


Adjusted Diluted Earnings per Common Share from
     Continuing Operations (a)(g)


$                            0.05


$                           (0.08)


$                            0.01


$                           (0.18)


_______________











(a)

Adjusted Operating Income (Loss) excludes streamlining initiatives, brand-exiting activities and acquisition related costs.  In addition to those items, Adjusted Income (Loss) from Continuing Operations and Adjusted Basic and Diluted Earnings per Common Share from Continuing Operations exclude impairment of cost investment, loss on extinguishment of debt and non-cash write-offs of debt issuance costs.


(b)

During the three and six months ended July 5, 2014 and June 29, 2013, the Company recorded expenses related to its streamlining initiatives, brand-exiting activities and acquisition related costs as follows:






























 Three Months Ended 


Six Months Ended






July 5, 2014


June 29, 2013


July 5, 2014


June 29, 2013






 (13 Weeks) 


 (13 Weeks) 


(27 Weeks)


(26 Weeks)



























Payroll, contract termination costs, asset write-downs and other costs:










   KATE SPADE North America


$                          1,058


$                             217


$                          3,155


$                             911



   Adelington Design Group


113


61


216


391



   Other (h)



3,743


1,131


30,474


3,058















Store closure, other brand-exiting activities and acquisition related costs:










   KATE SPADE North America


202


858


523


1,183



   Adelington Design Group


(7)


175


(14)


135



   Other (h)



(65)


97


(364)


(73)






$                          5,044


$                          2,539


$                        33,990


$                          5,605














(c)

Represents a non-cash write-off of debt issuance costs associated with the amended and restated revolving credit facility for the three and six months ended July 5, 2014.


(d)

Represents the portion of the non-cash write-off of debt issuance costs associated with the amended and restated revolving credit facility attributable to SG&A for the three and six months ended July 5, 2014.


(e)

Excludes a $2,302 non-cash write-off of debt issuance costs associated with the amended and restated revolving credit facility for the three and six months ended July 5, 2014. 


(f)

Reflects a normalized tax rate based on estimated adjusted pretax income (loss). 








(g)

Adjusted diluted earnings per share for the three and six months ended July 5, 2014 are based on 127,475 and 126,353 shares outstanding, respectively. As the Company incurred an adjusted loss from continuing operations for the three months and the six months ended June 29, 2013, all potentially dilutive shares are antidilutive. As such, basic and diluted weighted average shares outstanding are equal for such periods. 


(h)

Other consists of: (i) Juicy Couture and Lucky Brand restructuring charges principally related to distribution functions that are not directly attributable to Juicy Couture or Lucky Brand and therefore have not been included in discontinued operations; and (ii) unallocated corporate restructuring costs.













 




KATE SPADE & COMPANY




RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION




(All amounts in thousands)














As Reported (a)

Streamlining
Initiatives & Brand-
Exiting Activities (b)

 Adjusted Results 

Corporate (c)

Comparable         
Adjusted Results


Three Months Ended June 29, 2013 (13 Weeks)








Total Net Sales

$                      178,881


$                      178,881


$                      178,881




   KATE SPADE North America

134,749


134,749


134,749




   KATE SPADE International

32,046


32,046


32,046




   Adelington Design Group

12,086


12,086


12,086












Gross Profit

110,478


110,478


110,478












SG&A

114,245

(2,539)

111,706

(3,789)

107,917












Operating (Loss) Income

$                         (3,767)

$                          2,539

$                         (1,228)

$                          3,789

$                          2,561













Depreciation and amortization, asset impairments and losses on asset disposals, net (d)

7,662


7,662




Share-based compensation



1,193


1,193




Other expense, net (e)



(701)


(701)












Adjusted EBITDA



$                          6,926

$                          3,789

$                        10,715












Segment Adjusted EBITDA:








KATE SPADE North America



$                            8,337

$                            3,349

$                          11,686



KATE SPADE International



(661)

261

(400)



Adelington Design Group 



1,041

179

1,220



Other 



(1,791)

-

(1,791)







$                          6,926

$                          3,789

$                        10,715












Reconciliation to Loss from Continuing Operations:








Operating loss, per above

$                         (3,767)








Other expense, net

(832)








Impairment of cost investment

(6,109)








Interest expense, net

(11,544)








Provision for income taxes

1,336








Loss from Continuing Operations

$                      (23,588)

















_______________








(a)

Represents the results of Kate Spade & Company in accordance with accounting principles generally accepted in the US.




(b)

Represents charges due to streamlining initiatives, brand-exiting activities and acquisition related costs.





(c)

Represents adjustments to reflect Corporate Costs on an annualized Adjusted EBITDA basis of $(53) million.



(d)

Excludes amortization included in Interest expense, net.



(e)

Amount is net of foreign currency transaction adjustments of $131.





 




KATE SPADE & COMPANY




RECONCILIATION OF NON-GAAP FINANCIAL INFORMATION




(All amounts in thousands)














As Reported (a)

Streamlining
Initiatives & Brand-
Exiting Activities (b)

 Adjusted Results 

Corporate (c)

Comparable          Adjusted Results


Six Months Ended June 29, 2013 (26 Weeks)








Total Net Sales

$                      335,330


$                      335,330


$                      335,330




   KATE SPADE North America

239,205


239,205


239,205




   KATE SPADE International

68,553


68,553


68,553




   Adelington Design Group

27,572


27,572


27,572












Gross Profit

208,574


208,574


208,574












SG&A

220,199

(5,605)

214,594

(7,658)

206,936












Operating (Loss) Income

$                      (11,625)

$                          5,605

$                         (6,020)

$                          7,658

$                          1,638













Depreciation and amortization, asset impairments and losses on asset disposals, net (d)

15,982


15,982




Share-based compensation



2,344


2,344




Other expense, net (e)



(1,467)


(1,467)












Adjusted EBITDA, Net of Foreign Currency Transaction Adjustments


$                        10,839

$                          7,658

$                        18,497












Segment Adjusted EBITDA:








KATE SPADE North America



$                          10,297

$                            6,770

$                          17,067



KATE SPADE International



52

528

580



Adelington Design Group 



4,077

360

4,437



Other



(3,587)

-

(3,587)







$                        10,839

$                          7,658

$                        18,497












Reconciliation to Loss from Continuing Operations:








Operating loss, per above

$                      (11,625)








Other expense, net

(2,702)








Impairment of cost investment

(6,109)








Loss on extinguishment of debt

(1,108)








Interest expense, net

(23,760)








Provision for income taxes

2,030








Loss from Continuing Operations

$                      (47,334)

















_______________








(a)

Represents the results of Kate Spade & Company in accordance with accounting principles generally accepted in the US.




(b)

Represents charges due to streamlining initiatives, brand-exiting activities and acquisition related costs.





(c)

Represents adjustments to reflect Corporate Costs on an annualized Adjusted EBITDA basis of $(53) million.



(d)

Excludes amortization included in Interest expense, net.



(e)

Amount is net of foreign currency transaction adjustment of $1,235.





 

KATE SPADE & COMPANY

AVAILABILITY UNDER REVOLVING CREDIT FACILITY

(In thousands)

















July 5, 2014










Total Revolving Credit Facility Size(a)



$                   200,000


















Borrowing Base (a)




$                   219,214










Outstanding Borrowings




2,000










Letters of Credit Issued




16,089


Available Capacity




$                   181,911










Excess Capacity(b)




$                   161,911


_______________






(a)

Availability under the revolving credit facility is the lesser of $200 million and a borrowing base comprised primarily of eligible cash, accounts receivable and inventory.


(b)

Excess capacity represents available capacity reduced by the minimum required aggregate borrowing availability under the revolving credit facility of $20 million.




SOURCE Kate Spade & Company

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We are reaching the end of the beginning with WebRTC, and real systems using this technology have begun to appear. One challenge that faces every WebRTC deployment (in some form or another) is identity management. For example, if you have an existing service – possibly built on a variety of different PaaS/SaaS offerings – and you want to add real-time communications you are faced with a challenge relating to user management, authentication, authorization, and validation. Service providers will w...
The Internet of Things will greatly expand the opportunities for data collection and new business models driven off of that data. In her session at @ThingsExpo, Esmeralda Swartz, CMO of MetraTech, discussed how for this to be effective you not only need to have infrastructure and operational models capable of utilizing this new phenomenon, but increasingly service providers will need to convince a skeptical public to participate. Get ready to show them the money!
The Internet of Things will put IT to its ultimate test by creating infinite new opportunities to digitize products and services, generate and analyze new data to improve customer satisfaction, and discover new ways to gain a competitive advantage across nearly every industry. In order to help corporate business units to capitalize on the rapidly evolving IoT opportunities, IT must stand up to a new set of challenges. In his session at @ThingsExpo, Jeff Kaplan, Managing Director of THINKstrateg...
One of the biggest challenges when developing connected devices is identifying user value and delivering it through successful user experiences. In his session at Internet of @ThingsExpo, Mike Kuniavsky, Principal Scientist, Innovation Services at PARC, described an IoT-specific approach to user experience design that combines approaches from interaction design, industrial design and service design to create experiences that go beyond simple connected gadgets to create lasting, multi-device exp...
High-performing enterprise Software Quality Assurance (SQA) teams validate systems that are ready for use - getting most actively involved as components integrate and form complete systems. These teams catch and report on defects, making sure the customer gets the best software possible. SQA teams have leveraged automation and virtualization to execute more thorough testing in less time - bringing Dev and Ops together, ensuring production readiness. Does the emergence of DevOps mean the end of E...
Scott Jenson leads a project called The Physical Web within the Chrome team at Google. Project members are working to take the scalability and openness of the web and use it to talk to the exponentially exploding range of smart devices. Nearly every company today working on the IoT comes up with the same basic solution: use my server and you'll be fine. But if we really believe there will be trillions of these devices, that just can't scale. We need a system that is open a scalable and by using ...
The Internet of Things is tied together with a thin strand that is known as time. Coincidentally, at the core of nearly all data analytics is a timestamp. When working with time series data there are a few core principles that everyone should consider, especially across datasets where time is the common boundary. In his session at Internet of @ThingsExpo, Jim Scott, Director of Enterprise Strategy & Architecture at MapR Technologies, discussed single-value, geo-spatial, and log time series dat...
"Verizon offers public cloud, virtual private cloud as well as private cloud on-premises - many different alternatives. Verizon's deep knowledge in applications and the fact that we are responsible for applications that make call outs to other systems. Those systems and those resources may not be in Verizon Cloud, we understand at the end of the day it's going to be federated," explained Anne Plese, Senior Consultant, Cloud Product Marketing at Verizon Enterprise, in this SYS-CON.tv interview at...
"For the past 4 years we have been working mainly to export. For the last 3 or 4 years the main market was Russia. In the past year we have been working to expand our footprint in Europe and the United States," explained Andris Gailitis, CEO of DEAC, in this SYS-CON.tv interview at Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
P2P RTC will impact the landscape of communications, shifting from traditional telephony style communications models to OTT (Over-The-Top) cloud assisted & PaaS (Platform as a Service) communication services. The P2P shift will impact many areas of our lives, from mobile communication, human interactive web services, RTC and telephony infrastructure, user federation, security and privacy implications, business costs, and scalability. In his session at @ThingsExpo, Robin Raymond, Chief Architect...
The term culture has had a polarizing effect among DevOps supporters. Some propose that culture change is critical for success with DevOps, but are remiss to define culture. Some talk about a DevOps culture but then reference activities that could lead to culture change and there are those that talk about culture change as a set of behaviors that need to be adopted by those in IT. There is no question that businesses successful in adopting a DevOps mindset have seen departmental culture change, ...
The Domain Name Service (DNS) is one of the most important components in networking infrastructure, enabling users and services to access applications by translating URLs (names) into IP addresses (numbers). Because every icon and URL and all embedded content on a website requires a DNS lookup loading complex sites necessitates hundreds of DNS queries. In addition, as more internet-enabled ‘Things' get connected, people will rely on DNS to name and find their fridges, toasters and toilets. Acco...
"Cloud consumption is something we envision at Solgenia. That is trying to let the cloud spread to the user as a consumption, as utility computing. We want to allow the people to just pay for what they use, not a subscription model," explained Ermanno Bonifazi, CEO & Founder of Solgenia, in this SYS-CON.tv interview at Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
Enthusiasm for the Internet of Things has reached an all-time high. In 2013 alone, venture capitalists spent more than $1 billion dollars investing in the IoT space. With "smart" appliances and devices, IoT covers wearable smart devices, cloud services to hardware companies. Nest, a Google company, detects temperatures inside homes and automatically adjusts it by tracking its user's habit. These technologies are quickly developing and with it come challenges such as bridging infrastructure gaps,...
SYS-CON Media announced that Centrify, a provider of unified identity management across cloud, mobile and data center environments that delivers single sign-on (SSO) for users and a simplified identity infrastructure for IT, has launched an ad campaign on Cloud Computing Journal. The ads focus on security: how an organization can successfully control privilege for all of the organization’s identities to mitigate identity-related risk without slowing down the business, and how Centrify provides ...