MOVIE STAR, INC. PURCHASES $2 MILLION OF ITS 12.875% SUBORDINATED DEBENTURES
New York, NY – December 8, 1999 -- MOVIE STAR, INC. (ASE: MSI) today reported that it has repurchased $2 million of its 12.875% Subordinated Debentures of which $117,000 was remaining on the mandatory sinking fund payment due October 1, 2000. The remaining $1,883,000 represents approximately 30% of the final payment, due October 1, 2001, of its 12.875% Subordinated Debentures.
Movie Star will record a gain in its second quarter ended December 31, 1999 of approximately $160,000, net of related expenses, from this debenture repurchase. This brings the total gain in the second fiscal quarter to approximately $200,000, since earlier in the period, the Company repurchased $786,000 of these debentures for an approximate gain of $40,000, net of related expenses.
Commenting, Mel Knigin, President & CEO of Movie Star stated “With this debenture repurchase, we have utilized cash flow from operations to further reduce long-term debt and future interest expense. Thus far in the first half of fiscal year 2000, we have repurchased approximately $5.5 million of the 12.875% Subordinated Debentures which, at current short-term interest rates, is expected to result in annualized interest savings in excess of $250,000. We now have just under $4.4 million of these debentures outstanding and approximately $10.6 million of our 8% Notes, which together comprise most of our long-term debt.”
MOVIE STAR, INC. produces and sells ladies sleepwear, robes, leisurewear,
loungewear, panties and daywear and also operates 28 retail outlet stores.
Certain of the matters set forth in this press release are forward looking and involve a number of risks and uncertainties. Among the factors that could cause actual results to differ materially are the following: business conditions and growth in the industry; general economic conditions; addition or loss of significant customers; the loss of key personnel; product development; competition; foreign government regulations; fluctuations in foreign exchange rates; rising costs for raw materials and the unavailability of sources of supply; the timing of orders booked; and the risk factors listed from time to time in the Company's SEC reports.
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CONTACT: INVESTOR
RELATIONS COUNSEL:
Movie Star, Inc. -or- The Equity Group Inc.
Thomas Rende, CFO Linda
Latman (212) 836-9609
(212) 684-3400 www.theequitygroup.com