Perry Ellis International, citing continued strong gross margin expansion, said it expects a second-quarter loss ranging from 15 cents to 17 cents a share, a sharp reduction from a 42 cents-loss a year ago. Revenues are expected to reach $162 million, up from $159 million.
Excluding the planned exit of $11 million in unprofitable businesses from last year, revenues grew 9%.
Operating income are expected to range between $1.6 million to $1.9 million versus an operating loss of $1.9 million last year.
Results exceeded analysts' consensus EPS estimate calling for a 20 cents loss but were short of the Street's revenue target of $167 million.
Management said results reflected growth in the Perry Ellis-branded wholesale business as well as its own retail stores. Reducing its exposure to lower margin businesses helped profitability.
Positive operating cash flow enabled the company to re-purchase an additional $25 million of its senior notes, while also ending the quarter with full availability on its senior credit facility.
Its sports brands include Nike and Jantzen in swim; Grand Slam, Callaway, Top-Flite, PGA Tour and Champions Tour in golf; Gotcha, MCD and Redsand in action sports, and Pro Player team apparel.
