PVH Corp. announces Q1 results above guidance
It was a good first quarter of 2016 for PVH Corp., which posted results above guidance for the period.
The company said revenue increased 3% on a constant currency basis, (up 2% on a GAAP basis to $1.92bn) from $1.88bn in Q1 2015. Earnings before interest and taxes for the first quarter increased 18% on a non-GAAP and constant currency basis (decreased 4% including foreign currency exchange rate impacts) from $196m in the prior year’s first quarter. On a GAAP basis, earnings before interest and taxes increased to $295m compared to $177m in the previous year.
Calvin Klein saw a 13% revenue increase, up from $654m in the previous year. The company's North America revenue increased 14%, up from $339m in the previous year. International revenue increased 13% on a constant currency basis from $315m in the prior year’s first quarter, due principally to continued strong growth in Europe. Earnings before interest and taxes for the quarter of $90m on a GAAP basis were flat compared to the prior year’s first quarter.
Revenue in the Tommy Hilfiger business for the quarter increased 4% on a constant currency basis (increased 3% on a GAAP basis) from $767m in the prior year’s first quarter. North America revenue fell 5% on both a constant currency and a GAAP basis, compared to $354m in the previous year. This was due to continued softness in the retail business. Earnings before interest and taxes for the quarter was $206m on a GAAP basis, compared to $92m in the prior year’s first quarter.
Revenue in the Heritage Brands business for the quarter decreased 12% from $458m in the prior year’s first quarter, driven by the ongoing rationalization of the Heritage Brands business.
Commenting on these results, Emanuel Chirico, Chairman and Chief Executive Officer, noted, “We are very pleased with our first quarter 2016 results, which exceeded our expectations despite the difficult retail environment experienced in the U.S. market. Our Calvin Klein and Tommy Hilfiger businesses were the highlight, with significant strength demonstrated by our international businesses. Outperformance in Europe and China further demonstrated the power of our brands in key markets and their ability to post growth against a challenging macroeconomic environment.”
PVH Corp. is now projecting that 2016 earnings per share will be in a range of $6.45 to $6.55 on a non-GAAP basis, which includes approximately $1.55 per share negative impact related to foreign currency exchange rates. Excluding this negative impact, earnings per share on a non-GAAP basis is expected to increase 13% to 15% compared to earnings per share of $7.05 on a non-GAAP basis in 2015.
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