Aided by double-digit growth in the sportswear and intimate apparel group, The Warnaco Group Inc. on Monday posted a 27.7 percent increase in first-quarter profits and raised fiscal 2010 guidance.
This story first appeared in the May 11, 2010 issue of WWD. Subscribe Today.
For the three months ended April 3, the company said income rose to $48 million, or $1.02 a diluted share, from $37.6 million, or 81 cents, in the year-ago period. Excluding onetime costs in both periods, such as restructuring charges, income would have risen 16.6 percent to $50.8 million, or $1.08 a diluted share, 2 cents better than analysts’ estimates, from $43.6 million, or 94 cents, a year ago.
Revenues rose 9.4 percent to $588.2 million from $537.8 million.
By category, the sportswear group showed the biggest gain at 13.9 percent to $306.3 million from $269.1 million, followed by the intimate apparel group, up 12.2 percent to $193.9 million from $172.8 million. The swimwear group showed an 8.4 percent decline to $87.9 million from $96 million. By channel, wholesale sales gained 4.6 percent to $464.1 million from $443.7 million, while retail sales shot up 31.7 percent to $124.1 million from $94.2 million.
By region, sales in the U.S. were close to flat, inching up just 0.4 percent to $270.8 million from $269.7 million. In Mexico and Central and South America, revenues spiked 66.8 percent to $37.5 million from $22.5 million, followed by a sales gain of 23.2 percent in Canada to $25.5 million from $20.7 million. In Asia, sales rose 18.1 percent to $97.1 million from $82.2 million. European sales rose 10.2 percent to $157.3 million from $142.7 million.
The company raised fiscal 2010 guidance to adjusted diluted earnings per share for continuing operations in the range of $3.30 to $3.40, up from the previous forecast range of $3.10 to $3.20.
Joe Gromek, president and chief executive officer, said, “Looking ahead, we are optimistic about the prospects for our company….In addition to powerful brands, Warnaco possesses a highly efficient business model, an established global infrastructure and an experienced leadership team.” He said in 2010, the company will continue to focus on global expansion and “opportunities to expand our direct operation through strategic acquisitions of key distribution and franchise partners.”