STRENGTH IN LICENSED BUSINESSES PUTS GIII APPAREL BACK IN BLACK
NEW YORK — Riding a wave of strength in its licensed products, G-III Apparel Group returned to profitability in the fourth quarter and year ended Jan. 31.
The outerwear firm also said its license to make Tommy Hilfiger outerwear would end in April, but it expected new licenses to make up for any lost sales.
In the quarter, the outerwear maker earned $697,000, or 10 cents a share, against a $3.1 million loss a year ago. Excluding the results of the defunct BET Design Studio business and the reversal of unused prior-year restructuring charges, earnings reached $6.7 million, or 98 cents a share, against a $231,000 loss.
The firm last fall dissolved its joint apparel venture with Black Entertainment Network (BET), which included the Exsto young men’s brand.
Sales in the latest quarter jumped 69 percent to $33.4 million from $19.7 million.
In the year, earnings reached $5.8 million, or 84 cents, versus a $1.2 million loss a year ago. Sales jumped 23 percent to $149.6 million from $121.6 million.
“Our fourth-quarter and full-year results are indicative of the strong licensed portfolio we have established, as well as of the robust sales and solid improvements in profitability for our nonlicensed product,” said Morris Goldfarb, chief executive.
G-III noted that licensed product revenue grew 35 percent to $61.9 million from $45.9 million, helping gross margins improve to 26 percent of sales from 21.6 percent. G-III has licensing agreements with Kenneth Cole Productions and Nine West Group, as well as for sporting teams and universities.
Goldfarb said in the past few months “we have added Cole-Haan men’s and women’s outerwear and Jones New York men’s outerwear to our roster of brands. In fiscal 2001, we will continue to strive to add new branded businesses that will further enhance our existing portfolio.”