NEW YORK — Phillips-Van Heusen Corp. posted better than expected fourth-quarter earnings on Monday, saying its Calvin Klein branded apparel and licensing operations helped guide sales and earnings upward.
In the three months ended Jan. 29, the company — which abruptly announced last month that its chief executive officer of eight months, Mark Weber, would step down — earned $22.9 million, or 41 cents, up 32.5 percent from $17.3 million, or 33 cents, in the year-ago period. Analysts had been expecting 37 cents.
Fourth-quarter total revenues rose 11.2 percent to $460.1 million. The company cited strength in dress shirts, driven by the Geoffrey Beene and Calvin Klein brands, and sportswear, driven by Calvin Klein men’s better sportswear and the IZOD, Arrow and Van Heusen brands. Royalty and other revenues, which include the company’s Calvin Klein licensing business, increased 13 percent to $55.3 million. Of that, Calvin Klein licensing revenues, which rose 8.9 percent, contributed $45.9 million to the total.
PVH said its two businesses, apparel and related products and Calvin Klein licensing, each posted strong operating earnings in the quarter; apparel and related products’ operating earnings rose 45.2 percent to $32.8 million, and the Calvin Klein licensing segment’s operating earnings rose 21 percent to $23.1 million, driven by growth of existing and new licensees.
In the full year, the company earned $111.7 million, or $1.85, up from $58.6 million, or $1.14, a year ago. Revenues were $1.91 billion, an increase of 16.3 percent.
“Our Calvin Klein licensing business continues to be a key growth engine for our company,” Emanuel Chirico, the new ceo of PVH, said in a written statement released Monday after the close of the stock market. “Growth in licensing revenues in 2005 was fueled by initiatives to expand the breadth and reach of Calvin Klein product offerings … Our core dress shirt brands, together with our new introductions, Chaps and Donald J. Trump Signature Collection, exceeded expectations and contributed to the strong performance of our apparel segment in 2005.”
Looking to the first quarter, PVH forecast earnings per share of 59 to 60 cents, excluding certain items. With the items, including a one-time gain, EPS is forecasted at 70 to 71 cents. Revenues are expected to be between $495 million and $500 million. Analysts expect 50 cents in the first quarter on sales of $496 million.
This story first appeared in the March 21, 2006 issue of WWD. Subscribe Today.
PVH forecast full-year 2006 earnings per share of $2.16 to $2.22. That forecast excludes a one-time $30 million gain related to the sale by the company’s Calvin Klein subsidiary of minority interests in certain jeans and sportswear business operated in Europe and Asia; costs related to the departure of Weber, and certain restructuring costs. Including items, the annual forecast is for EPS of $2.27 to $2.33. Both yearly EPS forecasts include the impact of stock option expensing. PVH forecasted revenues at $1.96 billion to $1.98 billion in the year. Analysts are expecting EPS of $2.17 for the year on sales of $2.03 billion.
Shares of PVH closed at $35.25, up 80 cents, in Monday trading on the New York Stock Exchange.