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PVH Q3 2018 revenue up 7% to $2.5 bn

Dec '18
Courtesy: PVH
Courtesy: PVH
PVH Corp, an American clothing company, has reported revenue increase by 7 per cent in Q3 2018 compared to Q3 2017. Earnings per share on a GAAP basis was $3.15 for Q3 2018 compared to $3.05 in Q3 2017 and on a non-GAAP basis was $3.21 for Q3 2018 compared to $3.02 in Q3 2017; both GAAP and non-GAAP basis for Q3 2018 showed a $0.09 negative impact.

Revenue in the Tommy Hilfiger brand of the business for the quarter increased 11 per cent to $1.1 billion compared to the prior year period according to a media release by the company. Tommy Hilfiger international revenue increased 16 per cent to $708 million compared to the prior year period, driven by continued strong performance across all regions and channels, including a 13 per cent increase in comparable store sales. Tommy Hilfiger North America revenue increased 3 per cent to $424 million compared to the prior year period, primarily attributable to strength in the wholesale business, as comparable store sales were relatively flat.

Revenue in the Calvin Klein business for Q3 increased 2 per cent to $963 million compared to the prior year period. Calvin Klein International revenue increased 3 per cent to $482 compared to the prior year period, driven by growth in Europe. International comparable store sales increased 1 per cent. Calvin Klein North America revenue increased 1 per cent to $481 million compared to the prior year period, as growth in the wholesale business was partially offset by a 2 per cent comparable store sales decline.

Revenue in the Heritage Brands business for the quarter increased 8 per cent to $429 million compared to the prior year period, as solid growth in the wholesale business was partially offset by a 1 per cent comparable store sales decline.

“We are pleased with the strong earnings performance in the third quarter which exceeded our expectations driven by the power of our diversified global business model. We continue to over-deliver against our 2018 plan and are raising our full year earnings outlook based on our third quarter outperformance and our confidence in the opportunities for the fourth quarter, despite recent retailer bankruptcies in the US and UK and increasing geopolitical volatility around the world,” said Emanuel Chirico, chairman and chief executive officer of PVH.

“Our Tommy Hilfiger business truly outperformed, with strength across all regions, product lines and channels of distribution. The brand continues to gain meaningful market share, as our consumer-centric brand approach and consistent brand execution are driving global momentum. The Calvin Klein brand continues to command strong brand health and desire in all markets; however, the business in the third quarter experienced softness. While many of the product categories performed well, we are disappointed by the lack of return on our investments in our Calvin Klein 205 W39 NYC halo business and believe that some of the Calvin Klein Jeans re-launched product was too elevated and did not sell through as well as we planned,” added Chirico.

“As we move into 2019, we believe the consumer will increasingly feel more connected to the brand as we offer a more commercial product and marketing experience to capture the long-term opportunity for our Calvin Klein business,” concluded Chirico.

The company’s effective tax rate projections for 2018 include estimates of the impacts of the US Tax Cuts and Jobs Act of 2017 enacted on December 22, 2017, including the reduction of the corporate income tax rate from 35 per cent to 21 per cent, the implementation of a modified territorial tax system, the introduction of a tax on foreign income in excess of a deemed return on tangible assets of foreign corporations (known as ‘GILTI’) and the introduction of a base erosion anti-abuse tax measure (known as ‘BEAT’) that taxes certain payments between US corporations and their subsidiaries. (PC)

Fibre2Fashion News Desk – India

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