Despite warm weather and a challenging retail environment, Calvin Klein and Tommy Hilfiger are doing good things for PVH.

After the market closed, PVH Corp. posted lower third-quarter sales and earnings, which was negatively impacted by a strong dollar. But carve out the currency issues as well as costs incurred from its integration with The Warnaco Group Inc., and the results exceeded expectations due to a strong performance of the company’s Calvin Klein and Tommy Hilfiger International businesses.

Net income dropped 1.7 percent to $221.9 million, or $2.67 per share, from $225.7 million, or $2.71 per share as total revenue fell 3 percent to $2.16 billion from $2.23 billion in the same period last year. Gross margin as a percent of sales fell 170 basis points to 47.89 percent.

Due to a challenging market, the company said it was reiterating its full-year adjusted EPS to be between $6.90 and $7 per share.

Emanuel Chirico, chairman and chief executive officer, said in the report that results exceeded expectations “despite the difficult and volatile market environment, including the slowdown in traffic experienced in the U.S. during the quarter. Our results continued to highlight the strength of our Calvin Klein and Tommy Hilfiger International businesses and improving trends in our Heritage Brands business.”

The company said earnings per share on an adjusted basis came in at $2.66, which is “inclusive of a 44 [cents per share] negative impact compared to the prior year primarily related to foreign currency exchange rates.” Adjusted EPS excluding exchange rate issues were $3.10, which is a 21 percent gain over the same quarter last year. On a constant currency basis, total revenues showed a gain of 3 percent.

On a constant currency basis, the Calvin Klein business had a 7 percent sales gain while Tommy Hilfiger posted a 4 percent gain. The company’s Heritage Brands business, which is being repositioned, had a 5 percent sales decline in the quarter.

“The U.S. market during the second half of the quarter and currently in the fourth quarter continues to experience increased softness in traffic trends, in large part driven by the decline in international tourist traffic and spending trends coupled with unseasonably warm weather,” Chirico said.

PVH said in the earnings report that North America retail same-store sales “were flat to the prior year period primarily as a result of both the decline in traffic and spending trends in the company’s U.S. stores located in international tourist locations and unseasonably warm weather in the third quarter of the current year.”

Chirico said he believes “the current holiday season will continue to be very competitive and highly promotional and the volatility we are experiencing in the global environment will remain a headwind for the remainder of the year and into 2016.”

In its report, the company noted that inventory at the end of the quarter was 7 percent “over the prior year’s third quarter, including an overall cost increase of 4 percent attributable to U.S. dollar inventory purchases by the company’s international businesses.”

Regarding the global market, Chirico said foreign currency exchange rates as well as consumer spending trends that remain “unpredictable and volatile” present challenges, but the company’s Calvin Klein and Tommy Hilfiger brands can help the company “successfully navigate this uncertain environment.”

“We remain focused on the strategic growth opportunities ahead of us and believe the sound execution of our business strategies and investment in our world-class brands, together with our strong balance sheet and the efforts of our dedicated and talented associates, will position us to deliver long-term growth and stockholder value,” Chirico added.

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