WESTLAKE VILLAGE, Calif.--(BUSINESS WIRE)--November 3, 2011--K•Swiss Inc. (NASDAQ: KSWS) today announced results for the third quarter ended September 30, 2011. The operations of FORM Athletics are accounted for as a discontinued operation in the Company’s financial results and are excluded from futures orders data for the prior-year periods.

Net loss for the third quarter of 2011 was $15,418,000, or $0.43 per diluted share, compared with a net loss of $28,334,000, or $0.80 per diluted share, for the prior-year period. Net loss for the nine months ended September 30, 2011, was $45,286,000, or $1.28 per diluted share, compared with a net loss of $47,577,000, or $1.35 per diluted share, for the nine months ended September 30, 2010.

For the third quarter of 2011, total worldwide revenues increased 30.8% to $80,456,000 from $61,491,000 in the prior-year period. Domestic revenues increased 21.0% to $32,676,000 in the third quarter, and international revenues increased 38.6% to $47,780,000 for the same period. Total worldwide revenues for the first nine months of 2011 increased 25.3% to $218,194,000 from $174,192,000 for the first nine months of 2010. Domestic revenues increased 30.8% to $96,360,000 in the first nine months, and international revenues increased 21.2% to $121,834,000.

Worldwide futures orders with start ship dates from October 2011 through March 2012 decreased 4.2% to $76,598,000 at September 30, 2011. Domestic futures orders decreased 24.1% to $26,494,000 at September 30, 2011, from $34,894,000 the previous year. International futures orders increased 11.3% to $50,104,000 at September 30, 2011, from $45,021,000 the previous year.

Steven Nichols, Chairman of the Board and President, stated, “Our performance category and international operations continue to strengthen, but our domestic business, in total, needs more work to restore us to profitability.”

For 2011, the Company expects full year consolidated revenues to be approximately $260 million. Consolidated gross margin is expected to be approximately 36.5%, compared to 39.2% in 2010. Selling, general and administrative expenses are expected to be $153 million to $155 million.

K•Swiss will conduct a conference call on its third quarter 2011 results today, at 11:00 a.m. ET. The number to call for this interactive teleconference is (212) 231-2928. A replay of this conference call will be available until November 10, 2011, by dialing (402) 977-9140 and entering the passcode, 21542237.

The Company will also provide an online Web simulcast and rebroadcast of this conference call. The live broadcast of K•Swiss’ quarterly conference call will be available online at www.streetevents.com and www.earnings.com today, beginning at 11:00 a.m. ET. The online replay will follow shortly after the call and continue through November 10, 2011.

Founded more than forty years ago in Van Nuys, California, K•Swiss introduced the first all-leather tennis shoe, the K•Swiss “Classic” in 1966. Since its inception, K•Swiss has rooted itself in California Sport with an aim to be the most inspiring and innovative sports brand in the market. Today the Company offers performance and lifestyle footwear and apparel for several categories under its California Sports umbrella including Tennis Heritage, California Fit (Running, Triathlon and Fitness) and California Youth. K•Swiss also designs, develops and markets footwear under the Palladium brand. For more information about K•Swiss, visit www.kswiss.com.

Certain matters discussed in this press release are subject to certain risks and uncertainties that could cause actual results to differ materially, including, but not limited to: non-achievement of the assumptions discussed herein, general and regional economic conditions, availability of credit, industry trends, merchandise trends, including market acceptance of the Company’s product offerings, customer demand, competition, the impact of terrorism and/or a potential global conflict on the worldwide economy, dependence on large customers and credit concentrations and order cancellations and reduced sales resulting from a deepening of the current worldwide recession. A complete description of these factors, as well as others which could affect the Company's business, is set forth in the Company's periodic filings, including its Form 10-Q for the quarter ended September 30, 2011, which is currently on file with the SEC. Futures orders as of any date, represents orders scheduled to be shipped within the next six months. Futures orders as of a certain date do not include orders scheduled to be shipped on or prior to that date. The mix of “futures” and “at-once” orders can vary significantly from quarter to quarter and year to year and, therefore, “futures” are not necessarily indicative of revenues for subsequent periods.


K•Swiss Inc. Consolidated Statements of Loss
(In thousands, except earnings per share data)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010

Revenues	$	80,456		$	61,491		$	218,194		$	174,192
Cost of goods sold		51,631			36,458			138,413			102,987
Gross profit		28,825			25,033			79,781			71,205
Selling, general and administrative expenses		42,357			38,685			120,620			106,988
Operating loss		(13,532	)		(13,652	)		(40,839	)		(35,783	)
Other income/(expense)		-			-			3,000			(3,320	)
Interest income/(expense), net		242			(197	)		95			170
Loss before income taxes and discontinued operations		(13,290	)		(13,849	)		(37,744	)		(38,933	)
Income tax expense		342			13,993			1,904			8,152
Loss from continuing operations		(13,632	)		(27,842	)		(39,648	)		(47,085	)
Loss from discontinued operations, less applicable income tax		(1,786	)		(492	)		(5,638	)		(492	)
Net loss	$	(15,418	)	$	(28,334	)	$	(45,286	)	$	(47,577	)
Basic loss per share	$	(0.43	)	$	(0.80	)	$	(1.28	)	$	(1.35	)
Diluted loss per share	$	(0.43	)	$	(0.80	)	$	(1.28	)	$	(1.35	)
Weighted average number of shares outstanding
Basic		35,572			35,246			35,480			35,192
Diluted		35,572			35,246			35,480			35,192


K•Swiss Inc. Condensed Balance Sheets
(In thousands)

							September 30,
							2011			2010
ASSETS
CURRENT ASSETS
Cash and cash equivalents							$	37,419		$	44,116
Restricted cash and cash equivalents and restricted investments available for sale								22,702			24,373
Investments available for sale								6,228			71,637
Accounts receivable, net								43,298			44,174
Inventories								93,700			55,292
Prepaid expenses and other current assets								10,181			4,523
Income taxes receivable								-			14,865
Total current assets								213,528			258,980
PROPERTY, PLANT AND EQUIPMENT, NET								20,122			21,156
OTHER ASSETS
Intangible assets								14,575			18,269
Deferred income taxes								3,853			3,320
Other								4,719			10,120
Total other assets								23,147			31,709
							$	256,797		$	311,845

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Bank lines of credit							$	15,060		$	5,116
Current portion of long-term debt								284			300
Trade accounts payable								14,822			15,327
Accrued income taxes payable								-			165
Accrued liabilities								22,612			16,599
Total current liabilities								52,778			37,507
OTHER LIABILITIES
Long-term debt								155			436
Other liabilities								7,610			13,757
Contingent purchase price								3,886			5,857
Total other liabilities								11,651			20,050
STOCKHOLDERS' EQUITY								192,368			254,288
							$	256,797		$	311,845

31248 Oak Crest Drive, Westlake Village, CA	91361
(Address of principal executive offices)	(Zip code)

(d)	Exhibits.

	Exhibit Number	Description of Exhibit
	99.1	Press Release issued November 3, 2011.

		K-Swiss Inc.

Date:	November 3, 2011		By:	/s/ GEORGE POWLICK
			George Powlick,
			Vice President of Finance, Chief Administrative Officer, Chief Financial Officer and Secretary

Exhibit	Description

99.1	Press Release issued November 3, 2011.