G-III Apparel Group, Ltd. reported that sales jumped 39.4 percent in its second quarter ended July 31, to $424.0 million, led by strong performances by a number of Calvin Klein divisions and several of its outerwear and dress businesses.
Earnings surged 77.0 percent to $5.9 million, or 29 cents a share. Results came in well-above G-IIIs guidance given in early June calling for earnings in the range of 13 to 17 cents a share with sales around $392 million.
Similar to the first quarter, our growth reflects significant outperformance in our wholesale business, said Morris Goldfarb, G-IIIs chairman and CEO, on a conference call with analysts.
Standouts in the quarter included dresses, led by Calvin Klein and Eliza J. Outerwear selling got off to a fast start, led by Calvin Klein, Kenneth Cole, Cole Haan, Tommy Hilfiger, Guess? and Jessica Simpson. While the gains partly reflected accelerated early shipments, last year’s outerwear season ended clean and we have our sights set on another good outerwear season this year, said Goldfarb.
Calvin Klein handbags saw significant gains while Calvin Klein performance had another good quarter with strong increases in sales and margins. Calvin Klein sportswear achieved plan.
Its team sports business, its licensed fan business, had another solid quarter of sales and profits, said Goldfarb. The team sports business includes Touch by Alyssa Milano and G-III Sports by Carl Banks.
The improvement came despite a somewhat weaker than planned performance at its specialty retail segment, which consists of Wilsons Leather and Vilebrequin. Losses were also incurred with the transition and repositioning of its recently-acquired G.H. Bass footwear business.
Said Goldfarb, We expect to have transition to our new merchandise plan early in the fourth quarter. Were systematically addressing the look of the stores, store level staffing, marketing, and product. And we are excited about the revitalization of the GH Bass brand into a strong, healthy business.
The company now expects net earnings for the full year to climb in the range of 17.1 percent to 21.4 percent from a range of 13.6 percent to 17.8 percent previously. Revenues are expected to reach about $2.11 billion, up from a previous estimate of $2.05 billion.
For the third quarter, earnings are expected to rise to a range of $63.9 million and $67.3 million, up 7.2 percent to 12.9 percent versus the same period a year ago. Revenues are forecast to climb 20.4 percent to $805 million.
