Apparel maker Kellwood (NYSE:KWD) is getting caught up in the tough times facing its industry. But it can't blame just the current environment for its latest quarterly results.

Net earnings on an ongoing basis inched up to $0.39 a share, from $0.37 a year ago, excluding certain charges and gains from both periods. Doesn't sound too bad. However, that's only if you ignore a huge $2.94-per-share charge to write down goodwill and the impairment of certain assets. In Foolspeak, that means the businesses that Kellwood has bought are no longer worth what it paid for them. Ditto for some of its assets. Figure in the charge, and the company ended up reporting a net loss of $2.54 per diluted share.

Management did cite a softening retail environment, and although I'm not giving management any points for being astute, I will concede this point, to an extent. Some of Kellwood's largest customers, including Wal-Mart (NYSE:WMT) Macy's (NYSE:M), and Kohl's (NYSE:KSS) have all seen slowing trends, so it isn't surprising that the Kellwood's results aren't too spectacular.

Yes, the company is working on reorganizing itself. It's reducing its women's-sportswear segment into three divisions and refocusing its Phat Farm business solely on licensing. Management claims that annual cost savings from these efforts should begin in the fourth quarter. But Kellwood still has more restructuring charges to incur through 2008.

Guidance was reduced for the year. Management now expects to earn $1.30-$1.40 per share, way down from its prior expectation of $1.80-$1.89, based on the overall consumer spending environment. It also announced a new authorization to repurchase 2.5 million shares, or 10% of the outstanding total.

It sounds as if Kellwood is going through a turnaround period and trying to recover from some poor decisions in the past -- the asset-impairment charge, in particular, speaks for itself. But until I see signs of improvement, the cloth just doesn't measure up.

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Fool contributor Larry Rothman is happy to receive feedback, and he promises to read it when he's not being wrestled by his three children. Feel free to email him at rothmanviews@comcast.net. He doesn't have any positions in the companies mentioned. The Fool has a disclosure policy.