G-III posts 54% drop in second-quarter sales
G-III Apparel Group Ltd., the NYC-based owner of the DKNY and Donna Karan brands, reported a 53.8 percent decline in its second-quarter sales on Wednesday, as a result of disruptions related to the Covid-19 pandemic.
For the second quarter ended July 31, 2020, the company’s net sales dropped to $297.2 million from $643.9 million in the same period last year.
Quarterly net loss was $15 million, or $0.31 per share, compared to net income of $11.1 million, or $0.23 per diluted share, in the same period in the previous year.
“The pandemic has had a major impact on the fashion industry and our second quarter results,” said G-III chairman and CEO, Morris Goldfarb.
“Our customers now prefer casual, comfortable and functional attire. Through our broad range of brands and product categories, G-III is able to capitalize on these changing trends. We have reset our order book for the balance of the year and shifted our product assortment to athleisure, jeans, casual sportswear and coats.”
Goldfarb also highlighted the refinancing of the company’s balance sheet and the extension of the maturity of its revolving credit facility and term debt to 2025.
In addition, G-III previously announced that it will close its 110 Wilsons Leather and 89 G.H. Bass stores by the end of this fiscal year, which will result in the elimination of significant operating losses.
Following the completion of the restructuring process, G-III’s retail segment will consist of 41 DKNY and 13 Karl Lagerfeld Paris stores, along with the e-commerce sites of DKNY, Donna Karan, Karl Lagerfeld Paris, Andrew Marc, Wilsons Leather and G.H. Bass.
Looking forward, the company expects net sales to decline in the range of 28 to 33 percent in the second half of its fiscal year, compared to the same period last year.
Due to ongoing uncertainty surrounding the evolution of the Covid-19 pandemic, G-III has not provided fiscal guidance for the third quarter or full fiscal year 2021.
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