G-III disappoints with slowing revenue growth
G-III Apparel Group Ltd. announced improvements in sales and earnings for the first quarter of 2020, ended April 30 2019, on Wednesday, but disappointed with total revenues that came in under analysts’ predictions.
The New York-based company’s net sales for the quarter ended April 30, 2019, rose 3.6% to $633.6 million, up from $611.7 million in the prior-year period. Analysts cited by MarketWatch had expected revenues to total $650.0 million.
The group, which owns brands including DKNY and Donna Karan, and holds licenses with the likes of Calvin Klein, Tommy Hilfiger, Karl Lagerfeld Paris, Guess and Levi’s, reported net income of $12.0 million ($0.24 per diluted share), compared to $9.9 million ($0.20 per diluted share) in Q1 2019.
“We are pleased to have reported first quarter net income per diluted share that was at the high end of our expectations. Our results were once again fueled by strong performance in our wholesale business led by our five global power brands DKNY, Donna Karan, Calvin Klein, Tommy Hilfiger and Karl Lagerfeld,” said G-III Chairman and CEO Morris Goldfarb in a release.
G-III has been seeing strong sales growth since its acquisition of the Donna Karan and DKNY brands from LVMH in 2016, reporting record-breaking annual revenues at the end of last year.
The group also recently signed a licensing deal for the design, production and distribution of Calvin Klein women’s jeanswear in North America, rounding out its existing womenswear license portfolio with the brand, which already included ready-to-wear, dresses, outerwear, accessories and swimwear.
“We know disruption in the retail industry has never been greater, but we remain confident in our ability to adapt to unique challenges. We are well positioned for a solid year and I am confident we are poised to achieve significant growth over the next several years,” concluded Goldfarb.
Looking forward, G-III still expects to report annual net sales of approximately $3.28 billion in fiscal 2020, while net income is predicted to be between $163 million and $168 million, or $3.19 to $3.29 per diluted share
For Q2 the company is forecasting net sales of around $660.0 million and net earnings of between $8.0 million and $13.0 million ($0.15-$0.25 per diluted share).
Following the report of the apparel group’s revenue miss, shares in G-III dropped more than 7% in premarket trading on Wednesday.
Copyright © 2023 FashionNetwork.com All rights reserved.