Perry Ellis: a drop in domestic revenue but expanded international development
For the second consecutive year, American group Perry Ellis saw its revenue go down. After recording a 6% drop in 2013-14, this time it reports a 2% drop, to 890 million dollars, for its financial year closed at the end of January.
The group's management team, led by Oscar Feldenkreis, explains this downturn by a strategy concentrated on certain activities. The group withdrew from several sectors, particularly from the private label programme, and has an objective of yielding some of its brands, such as it recently did with C&C California. It specifies that it has exited from 30 brands that generated 80 million dollars in revenue compared to 2013-14.
Above all in 2014-15, Perry Ellis saw its operational result return to profit. After a complicated year with an operational loss of 19 million dollars, it saw nearly 23 million dollars in income for its last financial year.
The group highlights a net improvement of its gross margin due to a reduction in the share of products sold as promotional items but also better profitability of its products internationally and its licenses. For example, it has just renewed and extended, geographically-speaking, its agreement with Nike for the creation of swimming gear for the sports giant.
Perry Ellis indeed saw its revenue from licenses increase 7%, announcing 27 new licenses signed in 2014-15. Its revenue generated abroad increased 15%, now accounting for 12% of the group's activity compared to 10% a year earlier.
For 2016, the group has announced that it is continuing with its international development and licensing strategy, in particular for its Perry Ellis and Original Penguin brands. It is counting on its activity bouncing back, expecting revenue of between 925 and 935 million dollars. All this in addition to the improvement of its margins.
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