NEW YORK — Falling temperatures precipitated double-digit increases in sales and profits at G-III Apparel Group during the third quarter.
For the three months ended Oct. 31, the New York-based outerwear and sportswear maker said net income skyrocketed 68.8 percent to $8.5 million, or $1.16 a diluted share, compared with income of $5 million, or 68 cents, in the year-ago period. Net sales swelled 12.9 percent to $102.3 million from $90.6 million in the 2001 quarter.
Morris Goldfarb, G-III’s chief executive officer, said in a statement that the quarter’s improved results were highlighted by a strong showing in the midtier and mass distribution channels. “We achieved a higher level of shipments, kept our inventories clean and executed well,” he noted.
However, Goldfarb said that due to the rapidly rising costs and political and economic instability in Indonesia, G-III closed its factory there, which will result in a fourth quarter pretax charge in the range of $3 million to $5 million.
G-III reaffirmed its previously announced $190 million sales forecast for the fiscal year ending Jan. 31, 2003. However, due to the significant increase in operating losses at its Indonesian facility, as well as higher-than-planned advertising and third-party shipping costs, it now estimates that net income per diluted share, excluding the closing charge, will be in the range of 60 to 65 cents.
For the nine-month period, net income chilled 18.7 percent to $4.9 million, or 67 cents, compared with year-ago earnings of $6 million, or 82 cents. Sales eroded 9.2 percent to $155 million against year-ago sales of $170.7 million.
G-III has licenses with Kenneth Cole Productions, Nine West Group, Cole-Haan and Jones Apparel Group, as well as with the four major sports leagues and more than 50 universities nationwide.
The company named Richard D. White to its board of directors. White, a private investor, was involved with G-III’s initial public offering and, until recently, was a managing director of CIBC Capital Partners.