Perry Ellis meets revenue and earnings guidance in Q1, reiterates FY expectations
Perry Ellis announced on Thursday its first quarter 2018 results that are a “solid start” to the fiscal year, following a hit-and-miss fiscal 2017 that fell short of full year revenue expectations but met its earnings guidance.
First-quarter revenue decreased 7.3% to $242 million but surpassed the guidance range of $230 million to $235 million. The decrease reflected a planned decrease in shipments due to a reduction of customers’ doors and inventory discipline to drive higher margin sales. The inventory management led to a 120 basis-point expansion in GAAP gross margin to 37.6%.
SG&A expenses were $71.2 million compared to $69.9 million in the prior year, and EBITDA was $19.9 million versus $25.2 million in the previous year.
In addition, GAAP net income increased to $12.8 million, or $0.83 per diluted share, which surpassed the guidance of $0.70 to $0.75 per diluted share.
George Feldenkreis, Executive Chairman, Perry Ellis International, commented, "We continue to successfully navigate the changing U.S. retail environment, as demonstrated by our solid first quarter performance.”
“Our razor sharp focus on maximizing the potential of our core global brands by delivering a continuous flow of new innovative products while maintaining tight inventory discipline continued to serve us well in a difficult U.S. retail environment, with particular strength in Golf Lifestyle Apparel and Nike Swim.”
Perry Ellis extended its license agreement with Callaway Golf in November 2016 and entered into a distribution deal for Nike Swim at the beginning of 2017. The parent company of Original Penguin also said in March that it would focus on its licensing, menswear and direct-to-consumer businesses in fiscal 2018, and in the following month entered a new licensing agreement with Sector Apparel Group to expand Original Penguin to new markets in southern Africa.
Following the start to fiscal 2018, Perry Ellis reiterated its fiscal year 2018 guidance and expects revenues to be in range of $870 million to $880 million and adjusted diluted earnings per share to be in range of $2.07 to $2.17.
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