G-III Apparel Group Ltd. reported net income for the first quarter fell to $2.8 million, or 6 cents per diluted share, compared to $6.8 million, or 15 cents, in the prior year’s comparable period, but still came in ahead of Wall Street’s consensus estimate of 2 cents.
For the quarter ended April 30, G-III reported that net sales increased 6 percent to a first quarter record of $457.4 million compared to $433.0 million in the year-ago period.
When reporting fourth-quarter results on March 22, G-III forecast net sales of approximately $475 million and net income between $0.1 million and $2.4 million, or between $0.00 and $0.05 per diluted share.
Morris Goldfarb, G-III’s Chairman, Chief Executive Officer and President, said, “Fiscal 2017 got off to a strong start in our wholesale business, particularly with respect to our Calvin Klein products and our dress businesses including Eliza J and the newly launched Tommy Hilfiger dress line. Although our own retail businesses did not perform to plan, we expect many of the measures we are taking to improve top and bottom line performance for these businesses in the second half of the year. We are looking forward to our upcoming multi-category product launches for Tommy Hilfiger, as well as further penetration and distribution of the Karl Lagerfeld brand.”
Goldfarb concluded, “We believe that our leadership in product design, merchandising and sourcing will continue to drive our strong sell-through performance in department stores. In spite of the challenging retail climate, we are positioned well to continue to build our wholesale business, and remain confident with respect to our financial performance and forecast for the full year.”
Outlook
The company today reiterated its prior guidance for the full fiscal 2017 year ending January 31, 2017. The Company continues to expect net sales of approximately $2.56 billion and net income between $120 million and $125 million, or a range between $2.55 and $2.65 per diluted share. For the fiscal 2016 year ended January 31, 2016, net sales were $2.34 billion and net income was $114.3 million, or $2.46 per diluted share.
On an adjusted basis, excluding items resulting in other income in Fiscal 2016 of $0.02 per share, net of taxes, non-GAAP net income per diluted share was $2.44 for the 2016 fiscal year.
The company also continues to project adjusted EBITDA for fiscal 2017 to increase between 9 percent and 12 percent, to between approximately $228 million and $236 million. Adjusted EBITDA for fiscal 2016 was $210.1 million.
For its second fiscal quarter ending July 31, 2016, the Company is forecasting net sales of approximately $485.0 million compared to $473.9 million in the comparable quarter last year. The Company is also forecasting net income for the second fiscal quarter between $7.0 million and $9.0 million, or between $0.15 and $0.19 per diluted share, compared to net income of $12.5 million, or $0.27 per diluted share, in last year’s second quarter.
Non-GAAP Financial Measures
Reconciliations of GAAP net income per share to non-GAAP net income per share and of GAAP net income to adjusted EBITDA are presented in tables accompanying the condensed financial statements included in this release and provide useful information to evaluate the Company’s operational performance. Non-GAAP net income per share and adjusted EBITDA should be evaluated in light of the Company’s financial results prepared in accordance with GAAP.
About G-III Apparel Group, Ltd.
G-III is a leading manufacturer and distributor of apparel and accessories under licensed brands, owned brands and private label brands. G-III’s owned brands include Vilebrequin, Andrew Marc, Marc New York, Bass, G.H. Bass, Weejuns, G-III Sports by Carl Banks, Eliza J, Black Rivet and Jessica Howard. G-III has fashion licenses under the Calvin Klein, Tommy Hilfiger, Karl Lagerfeld, Kenneth Cole, Cole Haan, Guess?, Jones New York, Jessica Simpson, Vince Camuto, Ivanka Trump, Ellen Tracy, Kensie, Levi’s and Dockers brands. Through our team sports business, G-III has licenses with the National Football League, National Basketball Association, Major League Baseball, National Hockey League, Hands High, Touch by Alyssa Milano and more than 100 U.S. colleges and universities. G-III also operates retail stores under the Wilsons Leather, Bass, G.H. Bass & Co., Vilebrequin and Calvin Klein Performance names.
