Q3FY16 revenue up 3% in constant currency at PVH Corp

07 Dec '15
3 min read

Revenue for the third fiscal quarter ended November 11, 2105 rose 3 per cent on a constant currency basis at US based apparel marketer PVH Corp.

Revenue for the third quarter of fiscal 2016 increased 3 per cent on a constant currency basis, but decreased 3 per cent on a GAAP basis to $2.16 billion as against $2.23 billion in the fiscal ago period.

As compared to the prior fiscal third quarter, revenue rose 7 per cent year on year in the Calvin Klein business on a constant currency basis, but was flat on a GAAP basis.

Revenue grew 4 per cent year over year in the Tommy Hilfiger business on a constant currency basis; however fell 5 per cent on a GAAP basis.

In a press release, PVH informed that revenue also declined 5 per cent in the Heritage Brands business on a GAAP basis.

Earnings before interest and taxes on a GAAP basis was $254 million compared to $280 million in the prior fiscal's third quarter.

“The decrease was primarily due to a negative impact of foreign currency exchange rates and expenses incurred principally in connection with the discontinuation of several licensed product lines,” PVH explained.

“The decline was also due to exit from the Izod retail business, partially offset by a reduction in Warnaco integration and restructuring costs incurred compared to the prior year's third quarter,” it added.

Net interest expense dropped to $27 million in the period under review from $32 million in last fiscal's third quarter due principally to lower average debt balances.

The effective tax rate on a non-GAAP basis decreased to 15.3 per cent compared to 23.0 per cent in the third quarter of fiscal 2015.

The effective tax rate on a GAAP basis decreased to 1.9 per cent in the reporting quarter vis-à-vis 8.9 per cent in the third quarter of prior fiscal.

“The decrease in the effective tax rates is principally attributable to a favourable shift in the mix of earnings between tax jurisdictions and certain favourable discrete items,” the apparel marketer said.

Inventory at the end of the current fiscal's third quarter increased 7 per cent from a fiscal ago quarter including an overall cost increase of 4 per cent attributable to US dollar inventory purchases by its international businesses.

Earnings per share on a non-GAAP basis were $2.66, inclusive of a $0.44 negative impact compared to the prior year primarily related to foreign currency exchange rates.

Earnings per share on a non-GAAP basis excluding the negative impact primarily related to foreign currency exchange rates was $3.10, or an increase of 21 per cent over the previous fiscal's third quarter. (AR)

Fibre2Fashion News Desk – India

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