Phillips-Van Heusen Corp. shares slid 13.1 percent Tuesday after the company forecasted fourth-quarter and 2008 earnings below Wall Street expectations.
The apparel maker said in its earnings release after the market closed Monday that it expects fourth-quarter earnings in the range of 51 cents to 53 cents a diluted share, and 2008 earnings in the range of $3.55 to $3.65 a diluted share. Wall Street was predicting 55 cents in the fourth quarter and $3.66 for 2008.
In trading Monday, shares of Phillips-Van Heusen dropped to a new 52-week low of $36.65, before rallying slightly. The stock closed the day at $37.64.
In a conference call to Wall Street, the company said it is planning for aggressive markdowns in the fourth quarter.
"Looking at the fourth quarter, we are very comfortable with the guidance we gave the street," said Emanuel Chirico, chairman and chief executive officer, on the call. "We have factored in what we believe is more than efficient markdown to deal with the promotions and environment that we are dealing with, so we are very comfortable that we will deliver our guidance."
Phillips-Van Heusen is also being impacted by start-up costs from its Timberland and Izod businesses.
Chirico said he is taking a cautious view on the economy and consumer heading into the first half of 2008. But he believes the second half of the year will fare better as launches begin to contribute to the company's profit and it benefits from a share repurchase program.
The company expects same-store sales to be flat to up 1 percent in the first half of the year and increase 2 to 3 percent in the second half.
On Monday, Phillips-Van Heusen posted a 20 percent jump in third-quarter earnings, driven by strong sales in its Calvin Klein business. Net income rose to $60.9 million, or $1.05 a diluted share, from $50.8 million, or 89 cents, in the year-ago period on sales that climbed 22 percent to $611.4 million from $500.2 million.
Chirico said on the conference call the firm's underwear business posted a "30 percent increase in royalties for the quarter."
The ceo said business grew in the U.S. "just about 20 percent and the international business grew about 40 percent. The international growth was fueled by new product, but also by the continued opening of Calvin Klein underwear stores around the world, particularly throughout Asia." He went on to say the company's "jeans business was really driven by the international component of that. Our international jeans business overall was up about 20 percent."
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast