NEW YORK — Tumi Holdings Inc. experienced growth in all parts of its business except for North American wholesale operations as the accessories and travel product firm narrowly exceeded analysts’ expectations for third-quarter profits.
In the three months ended Sept. 29, the South Plainfield, N.J.-based company boosted net income 15.2 percent to $12.1 million, or 18 cents a diluted share, 1 cent higher than the consensus estimate of analysts. Year-ago profits were $10.5 million, or 15 cents.
Revenues accelerated 13.6 percent, to $108.9 million from $95.9 million, as gross margin expanded to 58.8 percent of sales from 57.6 percent a year ago.
By business segment, North American direct-to-consumer sales rose 16.6 percent to $47.2 million and international DTC was up 26 percent to $6.1 million. While international wholesale operations advanced 23.6 percent to $31.6 million, North American wholesale revenues declined 3.9 percent, to $24 million.
Michael Mardy, chief financial officer, told analysts on a Thursday afternoon conference call that some of the decline in North American wholesale was part of a series of “limitations” the company had placed on its business with retailers on the continent to combat unauthorized resale and diversion.
“This has become a more significant issue as brand awareness and the desirability of the Tumi brand have grown in [Asian] markets,” he said. “In addition, we had fewer off-price sales in the quarter.”
He estimated that self-imposed limits on North American wholesale subtracted about $2.5 million in revenue, partially offset by growth in U.S. department stores and increases in the company’s Canadian wholesale business.
Jerome Griffith, president and chief executive officer, noted that the company had introduced its Global Citizen marketing campaign in August and backed it with a push in the New York market beginning in October. “We’re getting great feedback on the campaign,” he said, “as it utilizes both traditional and social media but, more importantly, we see this as the long-term strategy to build brand awareness and loyalty for the brand and our broader product offering.”
The new campaign nudged Tumi’s marketing spend up about 40 percent in the third quarter. “And we anticipate this trend and spending to continue into the fourth quarter,” Griffith said. “Going beyond that, we believe just focusing on speaking about our brand directly with our consumer more often...will help us effectively cement our position as the travel lifestyle brand.”
In the first three quarters of the year, net income rose 70.2 percent to $33.8 million, or 50 cents a diluted, share, as revenues grew 17.8 percent, to $320 million.
EXCLUSIVE: @tomford is opening its first-ever beauty store. The boutique, which opens November 20 in London’s Covent Gardens, was designed with the over-the-top glam Ford is known for. Read the full story on WWD.com, link in bio. #wwdbeauty #wwdnews (📷: Simon Wagner) #TomFordBeauty
New York-based DJ @harleyvnewton threw a party to celebrate the holiday collection of her dress and pajama line @hvn at the Ladurée Beverly Hills. It Girls @katebosworth, @rashidajones and more joined in on the fun, which included cocktails, croque monsieur sandwiches and a photo booth. #wwdfashion (📷: Owen Kolasinski/BFA.com)
For the holidays, @Burberry partnered with 20-year-old artist @blondeymccoy on a series of three outdoor murals in downtown Manhattan. The murals are McCoy’s interpretation of a Christmas eve party, the idea of charity and the spirit of family. His third mural, pictured here, is the most personal. The image depicts McCoy’s grandparents and father in London’s Trafalgar Square in the Seventies. “My work often features lots of sentimental objects.” #wwdeye
For spring 2018, designers applied bold colors and cartoonish motifs on everything from sneakers and belts to key chains. See all the top men’s accessories trends on WWD.com. #wwdtrends (📷: George Chinsee; Prop Styling by @rnasti; Market Editor: @luiscampuzano)
The @dior-sponsored @guggenheim international gala pre-party has a history of drawing cool-girl musical acts to serenade the crowd –– and last night was no exception. @haimtheband performed songs both new and old, and lured a star-studded audience with the likes of Rebecca Hall, Kate Mara, Mamoudou Athie and more. #wwdeye (📷: @lexieblacklock)
In a partnership between the @metopera and the @englishnationalopera, “Marnie” was born. The opera, with costumes sponsored by @mrporterlive, is an adaptation of the 1961 thriller by Winston Graham. Arianne Phillips, who created the costumes, is no rookie: She’s styled Madonna for her tours and created costumes for a myriad of films in the past. Read WWD’s interview with Phillips, where she talks about her inspiration for the opera’s costumes on WWD.com #wwdfashion
@barneysnyc took a different approach to their holiday windows this year. Instead of Christmas decor, Barneys tapped @thehaasbrothers to tell a story of positivity, gratitude and inclusivity via heartwarming silliness and humor. “It’s about kids and it’s about coming together and being family and loving each other,” said Simon Haas. #wwdfashion (📷: @joshuascottphoto)
Beauty influencer @kandeejohnson makes her foray into hair care with a collaboration with @ogx_beauty — making it the first time that OGX has teamed up for a product creation. The collab includes shampoos and conditioners in three scents. At 39 and a mom, Johnson is a different profile than the emerging social media stars, but is considered one of the pioneers of the digital beauty influencer world. Read WWD’s interview with her on wwd.com, including the strangest beauty product she’s ever tried #wwdbeauty