PVH reports drop in Q3 revenue and earnings

Third quarter revenues at PVH Corp. decreased 18 percent or 21 percent on constant currency to 2.118 billion dollars compared to the prior year period. The company said, this revenue decrease was due to a 12 percent or 16 percent decrease on a constant currency basis in the Tommy Hilfiger business with Tommy Hilfiger North America revenue down 37 percent and Tommy Hilfiger International revenue flat or down 6 percent on a constant currency basis, an 18 percent or 21 percent decrease on a constant currency basis in the Calvin Klein business, with Calvin Klein North America revenue down 39 percent and Calvin Klein International revenue flat or down 4 percent on a constant currency basis and a 36 percent decrease in the Heritage Brands business compared to the prior year period.

Commenting on these results, Emanuel Chirico, Chairman and Chief Executive Officer of the company, said in a statement: “Our third quarter results exceeded our expectations across all markets and channels, with a very strong recovery in Europe and China, considering the ongoing Covid-19 pandemic. We have outperformed our Holiday season expectations in the fourth quarter to date, including Singles’ Day in Asia and our Black Friday promotions in North America and Europe, with particular strength across the digital channels.”

PVH says Covid-19 impacted revenue performance in nine months

For the third quarter, the company’s earnings per share on a GAAP basis were 98 cents compared to 2.82 dollars in the prior year period, while earnings per share on a non-GAAP basis were 1.32 dollars compared to 3.10 dollars in the prior year period. Earnings before interest and taxes on a GAAP basis for the quarter decreased to 122 million dollars compared to 270 million dollars in the prior year period and earnings before interest and taxes on a non-GAAP basis for the quarter decreased to 132 million dollars compared to 282 million dollars in the prior year period.

The company added that its business was significantly impacted by the Covid-19 pandemic during the first nine months of 2020, resulting in an unprecedented decline in revenue and earnings, including 962 million dollars of pre-tax noncash impairment charges recognized during the first quarter. Revenue for the first nine months of 2020 decreased 31 percent to 5.043 billion dollars compared to the prior year period.

The revenue decrease was due to a 25 percent decrease in the Tommy Hilfiger business including a 46 percent decrease in Tommy Hilfiger North America revenue and a 14 percent decrease in Tommy Hilfiger International revenue, a 32 percent decrease in the Calvin Klein business including a 48 percent decrease in Calvin Klein North America revenue and an 18 percent decrease in Calvin Klein International revenue, and a 45 percent decrease in the Heritage Brands business compared to the prior year period. Revenue for the first nine months of 2020 reflected a 70 percent increase in sales through the company’s directly operated digital commerce businesses, driven by strong growth in all six regions and brand businesses, which partially offset the decline in revenue through its other distribution channels. PVH further said, loss per share on a GAAP basis was 15.15 dollars for the first nine months compared to earnings per share of 6.46 dollars in the prior year period, while loss per share on a non-GAAP basis was 1.58 dollars compared to earnings per share of 7.64 dollars in the prior year period. Loss before interest and taxes on a GAAP basis was 1.098 billion dollars compared to earnings before interest and taxes of 654 million dollars in the prior year period and loss before interest and taxes on a non-GAAP basis was 66 million dollars compared to earnings before interest and taxes of 781 million dollars in the prior year period.

Picture:Tommy Hilfiger website