By  on November 20, 2007

Perry Ellis International Inc. reported third-quarter profits increased 3.7 percent on a 6.7 percent sales gain driven by its golf and action sports business, as well as strength in its namesake brand.

However, because of a challenging retail environment, the company lowered its full-year earnings per share estimate to a range of $1.78 to $1.82 a share, from a prior range of $1.87 to $1.91. Sales are now expected to be between $870 million to $880 million, down from previous estimates of between $900 million and $910 million.

For the quarter ended Oct. 31, net income rose to $8.5 million, or 55 cents a diluted share, from $8.2 million, or 53 cents, in the prior year on total revenue that climbed to $227.5 million from $213.2 million.

"The successful implementation of our key strategies along with the growing demand for our brands drove the results we expected, including strong organic sales growth and a record quarter for revenues and profitability," Oscar Feldenkreis, president and chief operating officer, said in a statement. "We accomplished this in spite of unseasonably warm weather and a challenging retail environment."

The company said operating expenses increased 9 percent during the quarter, "attributable to further investment in the company's retail and active sports divisions, start-up expenses for boys' wear and other initiatives and increased costs associated with the implementation of our Oracle Retek system."

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