Endeavor Acquisition Corp. Reports American Apparel's Third Quarter 2007 Financial Results

Business Wire, Nov 12, 2007

* Amendment to preliminary proxy statement filed with SEC

* American Apparel reports third quarter combined revenue of $106.5 million, up 34% over year ago period; combined Pro Forma Adjusted EBITDA of $17.4 million, up 221% over Q3 2006

* American Apparel posts third quarter retail same-store sales up 27% over third quarter 2006

NEW YORK -- Endeavor Acquisition Corp. (Amex: EDA) is pleased to report American Apparel's financial results for the third quarter of 2007. Endeavor filed an amendment to the preliminary proxy statement with respect to the proposed acquisition of American Apparel with the Securities and Exchange Commission on Friday, November 9, 2007. Endeavor is working towards mailing a definitive proxy statement to shareholders later this month in time for a special meeting of stockholders anticipated to be held on Wednesday, December 12, 2007 for stockholders of record as of November 16, 2007.

The amendment to the preliminary proxy statement includes unaudited financial information for each of Endeavor and American Apparel for the nine month periods ended September 30, 2007 and 2006. The amended proxy statement also includes additional information with respect to the revised transaction terms in the amended and restated merger agreement announced on November 8, 2007 and filed with the SEC on November 9, 2007.

The information below presents the combined results of American Apparel Inc. ("AAI") and The American Apparel Group of Canada ("CI"), collectively "American Apparel", unless specifically noted otherwise. Quarterly operating results are not necessarily indicative of the results that may be expected for other interim periods or the year ending December 31, 2007. AAI's interim financial statements for the periods ended September 30, 2007 and 2006 were not required to be reviewed and therefore were not reviewed by an independent registered public accounting firm using professional review standards and procedures. Certain account balances included in prior period financial statements have been reclassified to conform to the current period presentation.

American Apparel reported unaudited combined sales for the 2007 third quarter ended September 30, 2007 of $106.5 million, a 34% increase over sales of $79.4 million for the three month period ended September 30, 2006. Retail sales increased 43% to $55.9 million for the third quarter of 2007 as compared to $39.1 million for the same period in 2006, with same-store sales for stores open at least 12 months rising 27%. At September 30, 2007, American Apparel had 165 stores as compared to 142 stores at September 30, 2006. Wholesale results were $50.6 million for the 2007 third quarter as compared to $40.3 million for the 2006 third quarter, an increase of 25%.

Pro Forma Adjusted Earnings Before Interest, Taxes, Depreciation, Amortization and certain adjustments and exclusions ("pro forma adjusted EBITDA") equaled $17.4 million for the third quarter ended September 30, 2007. This represents a 221% increase over pro forma adjusted EBITDA of $5.4 million for the three months ended September 30, 2006. The non-cash and other adjustment items in the quarterly comparisons per the acquisition agreement include deferred rent, litigation/legal expenses and business combination expenses not capitalized. These adjustments totaled approximately $0.4 million for the three months ended September 30, 2007 as compared to approximately $(0.1) million for the three months ended September 30, 2006.

Dov Charney, Chief Executive Officer of American Apparel stated: "I am very proud of the financial results we have delivered in the third quarter, which were made possible by the important contributions of everyone at the company. I look forward to the completion of our merger with Endeavor which will result in American Apparel becoming a public company, and will allow our employees and the public to share in the future success of our business."

For the nine month period ended September 30, 2007, American Apparel reported combined sales of $275.6 million. This was a 31% increase over sales of $209.8 million for the nine month period ended September 30, 2006. American Apparel's retail sales for the first three quarters of 2007 were $146.7 million, an increase of 50% over the $97.7 million of sales in the comparable period for 2006. Wholesale sales for the nine month period ended September 30, 2007 were $128.9 million, a 15% increase over the $112.1 million for the nine months ended September 30, 2006.

Pro Forma Adjusted EBITDA equaled $45.0 million for the nine months ended September 30, 2007. This represents a 106% increase over pro forma adjusted EBITDA of $21.8 million for the nine months ended September 30, 2006. The non-cash and other adjustment items in the quarterly comparisons per the acquisition agreement include deferred rent, litigation/legal expenses and business combination expenses not capitalized. These adjustments totaled approximately $2.1 million for the nine months ended September 30, 2007 as compared to approximately $1.9 million for the nine months ended September 30, 2006.