The company’s branded stores in U.S. tourist hot spots continued to suffer, though. PVH’s second-quarter net income slipped 11.4 percent to $90.5 million, or $1.11 a diluted share, from $102.2 million, or $1.22 a year ago. But adjusted earnings per share came in at $1.47, ahead of the $1.27 analysts projected, according to S&P Capital IQ.
Revenues for the three months ended July 31 rose 3.7 percent to $1.93 billion from $1.86 billion a year earlier.
Calvin Klein drove the company ahead with revenues up 12 percent to $726 million for the quarter, supported by “continued healthy performance across the North American wholesale businesses.”
PVH said of the brand: “Revenue in the North America retail business grew modestly, as square footage expansion in company-operated stores was partially offset by a 4 percent comparable-store sales decline driven by continued weakness in traffic and consumer spending trends in Calvin Klein’s U.S. stores located in international tourist locations.”
The Tommy Hilfiger business rose 6 percent to $860 million. Dragging on the marquee names was the Heritage Brands group (which markets dress shirts, sportswear, swimwear, intimate apparel and other items under a range of labels and also handles the licensed businesses of the company’s Van Heusen, Izod, Arrow, Warner’s and Olga brands) which saw sales fall 14 percent to $347 million.
Emanuel Chirico, chairman and chief executive officer, said: “We experienced strong momentum in our Calvin Klein and Tommy Hilfiger International businesses and have seen improvement across our North America wholesale businesses, but we continue to be pressured by weakness in traffic and consumer spending trends at our Tommy Hilfiger and Calvin Klein U.S. stores located in international tourist locations.”
Chirico said the company would continue to invest in its businesses and has new marketing and commercial initiatives coming over the next six months — including “our creative team leadership change at Calvin Klein to our launch of the Gigi Hadid capsule collection and fall women’s wear campaign for Tommy Hilfiger, as well as our ongoing digital commerce efforts.”
This month, PVH named Simons chief creative officer of Calvin Klein Inc., making official a move that had been one of the worst-kept secrets in fashion.
His first collections will be shown early next year.
For the full year, PVH expects that its adjusted earnings per share will range from $6.55 to $6.65 — that’s up slightly from the $6.45 to $6.55 previously projected, but still down from the $7.05 seen a year earlier. The negative impact of currency exchange is expected to cut profits by $1.60 a share.
Revenues are projected to increase about 2 percent, with both Calvin Klein and the Tommy Hilfiger businesses up 5 percent and the Heritage Brands unit falling about 8 percent.
Chirico said, “We expect the macroeconomic and geopolitical volatility around the world to continue to impact the consumer” but added that the company would be able to “execute our strategic initiatives in an ever-changing retail environment.”