Perry Ellis International Announces Moody’s Updates its Rating to Positive

Perry Ellis International, Inc. (NASDAQ:PERY) today announced that Moody’s Investors Service updated its ratings outlook on the Company to Positive and concurrently affirmed its B2 Corporate Family and Probability of Default Ratings, as well as the B3 rating on its subordinated notes.

In its report dated June 24, 2010, Moody’s stated that: “The positive outlook reflected its expectation for sustained improvement in Perry Ellis’ operating performance, which is supported by the resumption of profitable growth through incremental business with existing and new customers and margin improvement through cost containment and better inventory management.” Moody’s also noted that Perry Ellis has also significantly improved its liquidity and credit metrics over the last nine months, aided by strong free cash flow and debt reduction.

George Feldenkreis, Chairman and CEO, stated: “We are pleased that Moody’s recognized the significant improvement in our operating performance, profitability and cash flow by revising upward its outlook on our debt to a positive rating. Our strategies, which focus on maximizing the performance of our growth platforms while repositioning or exiting lower margin and slower growth businesses, has positioned our Company for consistent and sustained growth in the current fiscal year and beyond. During the first quarter of fiscal 2011, this led to a 420 basis point increase in gross profit margin to 35.7%; a more than doubling in first quarter earnings per share and a reduction in total net debt to capitalization to 30% at quarter end from 44% at the end of the first quarter last year. We remain committed to our strategies, which we expect to lead to increased value for all Perry Ellis stakeholders.”

Separately, the Company also noted that on June 24th, it renewed its existing shelf registration statement which was to expire at the end of July by filing a universal shelf registration statement with the Securities and Exchange Commission. The shelf registration statement may be utilized to offer debt securities, preferred and common stock and other securities in order to provide the Company with flexibility to respond to future financing opportunities. No offering is currently contemplated by the Company.

A registration statement relating to these securities has been filed with the Securities and Exchange Commission but has not yet become effective. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This press release is neither an offer to sell nor the solicitation of an offer to buy any securities and shall not constitute an offer or solicitation in any jurisdiction in which such offer or solicitation is unlawful.

About Perry Ellis International

Perry Ellis International, Inc. is a leading designer, distributor and licensor of a broad line of high quality men's and women's apparel, accessories, and fragrances. The Company's collection of dress and casual shirts, golf sportswear, sweaters, dress and casual pants and shorts, jeans wear, active wear and men's and women's swimwear is available through all major levels of retail distribution. The Company, through its wholly owned subsidiaries, owns a portfolio of nationally and internationally recognized brands including Perry Ellis®, Jantzen®, Laundry by Shelli Segal®, C&C California®, Cubavera®, Centro®, Solero®, Munsingwear®, Savane®, Original Penguin® by Munsingwear®, Grand Slam®, Natural Issue®, Pro Player®, the Havanera Co.®, Axis®, Tricots St. Raphael®, Gotcha®, Girl Star®, MCD® John Henry®, Mondo di Marco®, Redsand®, Manhattan®, Axist® and Farah®. The Company enhances its roster of brands by licensing trademarks from third parties including Pierre Cardin® for men’s sportswear, Nike® and Jag® for swimwear, and Callaway®, TOP-FLITE®, PGA TOUR® and Champions Tour® for golf apparel. Additional information on the Company is available at http://www.pery.com.

Safe Harbor Statement

We caution readers that the forward-looking statements (statements which are not historical facts) in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations rather than historical facts and they are indicated by words or phrases such as "anticipate," "could," "may," "might," "potential," "predict," "should," "estimate," "expect," "project," "believe," "plan," "envision," "continue," "intend," "target," "contemplate," or "will" and similar words or phrases or comparable terminology. We have based such forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, and other factors that may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements, many of which are beyond our control. These factors include: general economic conditions, a significant decrease in business from or loss of any of our major customers or programs, anticipated and unanticipated trends and conditions in our industry, including the impact of recent or future retail and wholesale consolidation, the effectiveness of our planned advertising, marketing and promotional campaigns, our ability to contain costs, disruptions in the supply chain, our future capital needs and our ability to obtain financing, our ability to integrate acquired businesses, trademarks, trade names and licenses, our ability to predict consumer preferences and changes in fashion trends and consumer acceptance of both new designs and newly introduced products, the termination or non-renewal of any material license agreements to which we are a party, changes in the costs of raw materials, labor and advertising, our ability to carry out growth strategies including expansion in international and direct to consumer retail markets, the level of consumer spending for apparel and other merchandise, our ability to compete, exposure to foreign currency risk and interest rate risk, possible disruption in commercial activities due to terrorist activity and armed conflict, and other factors set forth in Perry Ellis International's filings with the Securities and Exchange Commission. Investors are cautioned that all forward-looking statements involve risks and uncertainties, including those risks and uncertainties detailed in Perry Ellis' filings with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which are valid only as of the date they were made. We undertake no obligation to update or revise any forward-looking statements to reflect new information or the occurrence of unanticipated events or otherwise.

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