PVH: Q1 GAAP earnings per share improve, revenues up 16 percent

First quarter revenue at PVH Corp increased 16 percent or 10 percent on constant currency basis to 2.3 billion dollars. Earnings per share on a GAAP basis were 2.29 dollars compared to 0.89 dollar in the prior year period. Earnings per share on a non-GAAP basis were 2.36 dollars compared to 1.65 dollars in the prior year period. Earnings before interest and taxes on a GAAP basis for the quarter increased to 244 million dollars from 113 million dollars in the prior year period. Earnings before interest and taxes on a non-GAAP basis for the quarter were 251 million dollars compared to 193 million dollars in the prior year period.

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Commenting on these results, Emanuel Chirico, PVH’s Chairman and Chief Executive Officer, said in a statement: “We experienced broad-based strength across our businesses globally and our performance underscored the power of our diversified business model and the continued momentum in our global designer lifestyle brands, Calvin Klein and Tommy Hilfiger. We are pleased to increase our earnings guidance for the year, despite the continuing volatility in the macroeconomic and geopolitical environments, which is resulting in a significantly lower foreign currency benefit than previously planned for the year.”

First quarter Calvin Klein revenues improve 18 percent

Revenue in the Calvin Klein business for the quarter increased 18 percent or 12 percent on constant currency to 890 million dollars. Calvin Klein International revenue increased 25 percent or 14 percent constant currency to 475 million dollars, driven by continued positive performance in Europe and Asia, including a 9 percent increase in comparable store sales.

Calvin Klein North America revenue increased 10 percent, also on a constant currency basis to 415 million dollars as a result of strong wholesale performance across all categories and a 5 percent increase in comparable store sales. Earnings before interest and taxes for the quarter increased to 109 million dollars, inclusive of a 5 million dollars positive impact due to foreign currency translation, from 93 million dollars in the prior year period.

Revenue in the Tommy Hilfiger business increased 21 percent or 11 percent constant currency to 1 billion dollars. Tommy Hilfiger International revenue increased 25 percent or 10 percent constant currency to 655 million dollars, driven by continued strong performance across all regions and channels, including a 9 percent increase in comparable store sales.

Tommy Hilfiger North America revenue increased 13 percent, also on a constant currency basis to 361 million dollars, principally attributable to a 9 percent increase in comparable store sales and strong performance in the wholesale business. Earnings before interest and taxes on a GAAP basis for the quarter increased to 132 million dollars from 33 million dollars in the prior year period. Earnings before interest and taxes on a non-GAAP basis for the quarter increased to 139 million dollars, inclusive of a 12 million dollars positive impact due to foreign currency translation, from 101 million dollars in the prior year period.

Revenue in the Heritage Brands business for the quarter increased 5 percent to 409 million dollars due to a shift in the timing of shipments into the first quarter from the second quarter as compared to the prior year periods. Comparable store sales increased 1 percent. Earnings before interest and taxes for the quarter increased to 42 million dollars from 32 million dollars in the prior year period.

PVH updates earnings expectations from FY18

The company currently projects that 2018 earnings per share on a GAAP basis will be in a range of 8.81 dollars to 8.91 dollars compared to 6.84 dollars in 2017. The company currently projects that 2018 earnings per share on a non-GAAP basis will be in a range of 9.05 dollars to 9.15 dollars compared to 7.94 dollars in 2017. Both the GAAP and non-GAAP projections include the expected positive impact of approximately 0.12 dollar per share related to foreign currency translation.

Revenue in 2018 is projected to increase approximately 6 percent or approximately 5 percent on a constant currency basis compared to 2017. Revenue for the Calvin Klein business is projected to increase approximately 8 percent or approximately 7 percent on a constant currency basis, revenue for the Tommy Hilfiger business is projected to increase approximately 7 percent or approximately 6 percent on a constant currency basis and revenue for the Heritage Brands business is projected to be relatively flat.

For the second quarter, earnings per share on a GAAP basis is projected to be in a range of 1.98 dollars to 2.03 dollars compared to 1.52 dollars in the prior year period and earnings per share on a non-GAAP basis are expected to be in a range of 2.05 dollars to 2.10 dollars compared to 1.69 dollars in the prior year period. Both the GAAP and non-GAAP projections include the expected positive impact of approximately 0.03 dollar per share related to foreign currency translation.

Revenue in the second quarter of 2018 is projected to increase approximately 10 percent or approximately 9 percent on a constant currency basis compared to the prior year period. Revenue for the Calvin Klein business is projected to increase approximately 15 percent or approximately 14 percent on a constant currency basis. Revenue for the Tommy Hilfiger business in the second quarter is projected to increase approximately 13 percent or approximately 12 percent on a constant currency basis and revenue for the Heritage Brands business in the second quarter is projected to decrease approximately 4 percent compared to the prior year period.

Picture:Calvin Klein website