Counselor Top 40 supplier American Apparel (asi/35297) has announced its total third-quarter sales were $156 million, a year-over-year decrease of 5%. Comparable retail and online sales fell by 7% and 5%, respectively, while wholesale revenues increased by 2%. Adjusted EBITDA improved to $13.5 million, while operating expenses – excluding non-recurring costs – decreased $5.7 million, or 7%.

“The strength of American Apparel’s operating model is evident in the 38% year-over-year improvement in adjusted EBITDA,” said Scott Brubaker, American Apparel’s interim CEO. “We are proud to have achieved this growth during a period of company-wide operational restructuring and in a challenging macro-economic environment for retailers. I am encouraged by these results, and am optimistic about the future prospects of the business.”

American Apparel’s gross profit for the third quarter decreased 2% to $82.5 million, due to the lower retail and online sales volume, the company said. The California-based firm reported a Q3 net loss of $19.2 million, compared to a net loss of $1.5 million, for the third quarter of 2013. Excluding unusual costs, income from operations was $4.8 million, compared to $1.6 million in the same period a year ago.

Clearly evident in the company’s public filing is the ongoing financial impact of ousting founder and longtime CEO Dov Charney. On June 18, American Apparel’s board of directors voted to suspend Charney, alleging several cases of misconduct. Following Charney’s removal, American Apparel formed a special investigative committee that would help determine next steps. The findings of that committee have not been released.

In total, American Apparel spent $5.3 million during the third quarter in legal and consulting fees related to Charney’s removal. Last month, Bloomberg reported that American Apparel’s board of directors is now open to offering Charney a formal role at the clothing company. Currently, Charney is serving as paid consultant.  

Ranked by Counselor as the 14th largest supplier in the industry, American Apparel reported 2013 North American ad specialty sales of $99.2 million, a year-over-year increase of 2.5%.

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