Net income slipped 18% to $38,071,000 from $46,252,000 on net sales that were down 4% to $402,563,000 from $420,042,000, but would have been up 2% without a $24.5 million reserve adjustment for the bag recall announced in Q4. The top line includes $12.5 million in gift card redemptions. The company began processing returns and claims in the quarter, with a higher number of customers opting for gift cards over product replacement than initially guided. This prompted several adjustments, including the reserve against future gift card sales. The remedy preference also resulted ... Log in to view full article.