PVH posts mixed results for third quarter
Fashion giant PVH Corp, the company behind brands like Tommy Hilfiger and Calvin Klein, reported a mixed bag of earnings at the end of last week, and committed issued fourth-quarter guidance in-line with analysts’ estimates. It also highlighted the cause of certain weaknesses: first, less business in China, and second, a ‘disappointing’ performance in flagship brand Calvin Klein. In regards to the latter, the company has committed to fixing the problem.
PVH Corp’s share price has appreciated by 2% over the last five days
Source: Yahoo Finance
It was not all doom and gloom. Here’s the numbers: adjusted earnings per share came in at $3.21, beating the company’s guidance as well as analysts’ expectations of $3.14 per share. This represents a 6.3% increase on earnings in the third quarter of the previous year. Total revenues came in at $2,524.5 – a year-on-year increase of 7%, but a slight miss against the Street’s wishes ($2,528). On a constant currency basis, that year-on-year top-line growth comes in at 9%. Total gross profit was up 5.2% against the year-ago period.
The company is raising its guidance for the fourth quarter to be in-line with consensus estimates, and said that Tommy Hilfiger had an “exceptionally strong” quarter, while Calvin Klein showed more mixed results – something that the company vows to fix. It also said it was still seeing outperformance in China, but that the trend there was “softening”. On the company’s earnings call, CEO Manny Chirico took the opportunity to talk up the company’s ecommerce showing:
“From a digital sales point of view, we continue to see growth at an outpaced rate with revenues growing over 20% across our third party and our owned and operated businesses. Again, our digital sales for the company represent about 10% of total revenues. We are off to a strong start in the fourth quarter and including an excellent Black Friday weekend.”
Dominion holds PVH Corp in its Global Trends Luxury Fund.
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