Double-digit revenue and profit growth at its two designer divisions allowed PVH Corp. to overcome weakness in the Heritage Brands unit and post second-quarter profits comfortably ahead of Wall Street’s and its own expectations.
For the three months ended July 31, the company reported net income of $66.7 million, or 92 cents a share, versus a loss of $70.6 million, or $1.07 a share, in the second quarter of 2010, when it concluded its purchase of Tommy Hilfiger. Stripping out extraordinary items, including those related to the acquisition, earnings per share for the quarter were $1.07, 12 cents better than the guidance provided in June and subsequently adopted by analysts.
Revenues totaled $1.33 billion, up 21 percent from the $1.1 billion reported in the year-ago period, as net sales rose 21.4 percent to $1.23 billion from $1 billion.
Emanuel Chirico, chairman and chief executive officer, said, “Trends in both the Calvin Klein and Tommy Hilfiger businesses globally demonstrate how powerful brand appeal translates into strong performance across product categories, distribution channels and geographies. As such, we continue to invest in marketing to broaden the reach of the Calvin Klein and Tommy Hilfiger brands worldwide.”
Hilfiger revenues rose 30.2 percent to $692.9 million while adjusted earnings before interest and taxes were up 33.5 percent to $75.6 million. Calvin Klein revenues were up 18.9 percent to $239.9 million with EBIT up 21.4 percent to $65.6 million. Same-store sales were ahead 21 percent at Calvin Klein, 13 percent at Tommy Hilfiger North America and 12 percent for the Hilfiger business in other parts of the world.
The Heritage Brands unit saw operating earnings, excluding costs incurred in connection with PVH’s early termination of its Timberland license, contract 2.7 percent to $30.2 million on an 8.8 percent increase in revenues to $401.7 million. Same-store sales rose 2 percent. Although wholesale volume of dress furnishings was up 20 percent and profitability for that business rose substantially, improvements were “more than offset by a gross margin decline due to higher product costs and increased promotional selling in the Izod wholesale sportswear division.”
Long-term debt was reduced to $2.09 billion from $2.49 billion a year ago as the company made debt payments of $247.5 million on outstanding term loans during the first half, the majority ahead of schedule. Debt payments since the Hilfiger acquisition are about $500 million.
Full-year EPS guidance was raised to $5 to $5.12 on a non-GAAP basis from the range of $4.80 to $5 provided in June.
For the first half of 2011, net income was $124.4 million, or $1.71 a share, against a net loss during the first six months of 2010 of $98.2 million, or $1.67. Revenues, which include Tommy Hilfiger for all of the current year but for less than three months of 2010, were up 57 percent to $2.7 billion from $1.72 billion.
The company, known as Phillips-Van Heusen Corp. prior to changing its name in June, will discuss the results during a conference call today.
Taking the final spot on the mens’ portion of New York Fashion Week calendar next month will be none other than @tomford. Though he’s shown his men’s wear in New York in the past, this will mark the first time the designer has shown his men’s collection alone during New York Fashion Week: Men’s. His runway show will debut on February 6 at the Park Avenue Armory. #wwdfashion
London-based couture house @ralphandrusso has certainly been in the spotlight, having its dresses worn by @beyonce, Angelina Jolie, Meghan Markle in her engagement photos and more. For couture, Tamara Ralph focused on ornamentation — think: feathers with chain mail, jet embroidery and clusters of pearls and crystals. See the rest of the collection on WWD.com #wwdfashion #couture (📷: @giovanni_giannoni_photo)
Minnie Mouse celebrated her 90th birthday by getting her own star on the Hollywood Walk of Fame. For her celebratory luncheon, @coach’s creative director @stuartvevers dressed her in a custom made prairie dress, complete with Vever’s take on the polka dot – black sequined versions – under a cropped motorcycle jacket. The designer also put his own mark on Minnie’s classic red shoes, infusing the color with sparkles and adding some Coach crystals. “We chose colors that were very Minnie and also represented quintessential Coach elements,” said Vevers. #wwdfashion #nationalpolkadotday (📷: George Chinsee)
@nickjonas is unveiling his first-ever apparel collection through a partnership with John Varvatos. The limited-edition capsule, which makes its debut in spring, also marks the first time the designer has collaborated with anyone on a line. “The process in working with Nick is amazing. It’s inspiring to be around someone who is not only connected with the trade that they do, but also with what’s happening in the environment around him, and how that connects to what we do with style,” said Varvatos. (RG: @johnvarvatos) #wwdfashion
@margotrobbie steps out onto the red carpet wearing @miumiu. The actress is nominated for “Outstanding Performance by a Female Actor in a Leading Role” in “I, Tonya” at the #SagAwards. (📷: Stewart Cook) #wwdfashion
For @massimogiorgetti of @msgm, the Nineties are his favorite decade. “They had a huge impact on my personal growth. What I like of the Nineties is that they are not so precise in terms of style as other decades…there was actually a bit of everything,” he said. As seen on MSGM’s Spring 2018 show: tie-dye and a bit of grunge, two styles that are synonymous with the decade #wwdfashion #wwddecades (📷: @kukukuba)