American Apparel Tuesday reported heavy Q3 losses, worse than expectations, as it saw its worse sales dive since Q4 2010.
The company is still reeling from its ouster of CEO and founder Dov Charney, who has been accused of sexual and financial improprieties. The investigation and ouster of Charney cost $5.3 million in legal fees and other costs last quarter.
Charney is working as a paid consultant to the company and his future there is still a matter of discussion, sources say.
Things seem to be calming down at American Apparel, but the retailer was struggling even before the distracting and expensive drama this past summer. Interim CEO Scott Brubaker put a positive spin on the Q3 results, saying the company did well under the circumstances.
"I am encouraged by these results," Brubaker said in a statement Monday, saying the retailer showed a 38% improvement, to $13.5 million in adjusted earnings (before interest, taxes, depreciation, and amortization).