G-III posts 3% sales rise; crops full-year guidance
G-III Apparel Group, Ltd., the owner of brands including DKNY, Donna Karan and Andrew Marc, announced moderate increases in sales and income for the second quarter ended July 31, 2019 on Thursday, but revised down its full-year earnings guidance in the face of mounting tariffs.
The New York-based company’s net sales increased 3.1% to $643.9 million in Q2, up from $624.7 million in the prior-year period. Growth was particularly strong in the apparel group’s wholesale segment, where sales rose 8.1% to $588.6 million.
G-III’s net income for the quarter totaled $11.1 million, or $0.23 per diluted share, compared to $10.1 million, or $0.20 per diluted share, in the same period in the previous year.
Year to date, the company’s net sales rose 3.3%, from $1.24 billion to $1.28 billion, while net income came to $23.2 million, or $0.47 per diluted share, up from $20.0 million, or $0.40 per diluted share, in the first six months of the previous year.
“We are pleased to report second quarter results that met our expectations and were fueled by continued outperformance in our wholesale business enabling us to navigate the ever-changing retail landscape,” said G-III Chairman and CEO Morris Goldfarb in a release. “However, based on the additional tariffs that were just implemented, we feel it is prudent to revise our guidance to a more conservative posture for the remainder of this fiscal year.”
In line with Goldfarb’s comments, G-III reported that it now expects to see net income of between $154 million and $159 million, or between $3.10 and $3.20 per diluted share, in fiscal 2020, down from its previously reported guidance of between $3.25 and $3.35 per share.
The company did, however, slightly increase its full-year sales guidance from $3.28 billion to approximately $3.30 billion.
Currently, G-III is forecasting net sales of approximately $1.17 billion for the third quarter, with net income expected to total between $90.0 million and $95.0 million, or between $1.85 and $1.95 per diluted share.
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