PVH Corp. (PVH) Wednesday reported a surge in first-quarter profit, driven mainly by "continued momentum" at its Calvin Klein and Tommy Hilfiger brands. PVH's earnings and revenues for the quarter came in well ahead of analysts' expectations.
The clothing company lifted its financial outlook for the full year 2012, and detailed second-quarter earnings above current analysts' expectations. The revision was based on continued strong performance from the two brands of Calvin Klein and Tommy Hilfiger.
Chief Executive Emanuel Chirico said, "Both of these brands continued to demonstrate their worldwide consumer appeal during the first quarter, allowing us to perform above our expectations for both revenue and earnings per share, despite the cost pressures and economic headwinds in Europe that have impacted our industry."
PVH, which owns and markets Calvin Klein, Van Heusen, Arrow and Tommy Hilfiger brands, renamed itself from Phillips-Van Heusen Corp. last year, as a majority of its revenues were contributed by Calvin Klein and Tommy Hilfiger brands rather than Van Heusen.
Revenues from Calvin Klein business rose 7 percent to $262.1 million, with comparable store sales growth of 9 percent. Revenues from Tommy Hilfiger advanced 8 percent year-over-year to $770.4 million, as retail comparable-store store sales growth increased 16 percent in North America while European comparable store-sales grew 5 percent.
PVH said total revenues for the first quarter grew 4 percent to $1.43 billion, topping analysts' estimate of $1.40 billion.
The New York-headquartered company's first-quarter net income improved to $93.1 million or $1.27 per share from $57.7 million or $0.79 per share last year. On an adjusted basis, earnings advanced to $1.30 per share from $1.23 per share last year. Analysts polled by Thomson Reuters expected earnings of $1.26 per share for the quarter. Analysts' estimates typically exclude special items.
Looking forward to the second quarter, PVH expects adjusted earnings in a range of $1.18 to $1.20 per share. The company expects second-quarter revenues to be relatively flat compared to last year's revenue of $1.33 billion. Analysts currently expects earnings of $1.17 per share for the quarter, with revenue of $1.35 billion.
For the full-year 2012, the company lifted its adjusted earnings guidance to a range of $6.15 to $6.25 per share, from prior estimate of $6.10 to $6.20 per share. Analysts currently estimate earnings of $6.17 per share for the full year.
PVH now projects full-year 2012 revenues to increase 1 percent to 2 percent compared to last year's revenue of $5.89 billion. Previously, the company expected full year revenues to be relatively flat to up to 2 percent. Analysts currently estimate revenues of $6.03 billion for the full year.
"As we head into the second quarter, we are optimistic that the strength of our brands and the sound execution of our business strategies, along with our strong balance sheet, will continue to drive long-term growth and improvements in our financial metrics and business returns in 2012 and beyond," said Chirico.
PVH closed Wednesday's trading on the NYSE at $77.37, down $0.18 or 0.23%, on a volume of 2.7 million shares. The stock however gained $3.12 or 4.03% in after-hours trade.
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