G-III Apparel eyes further acquisition opportunities
G-III bought Vilebrequin last year in a deal worth EUR85.5m (US$106.2m)
Speaking at the 15th Annual ICR XChange investor conference in Miami last week, chief operating officer Wayne Miller said: "Acquisitions have been an important part of the company's growth over the past eight years. We continue to look. I would say that first and foremost we're looking for a brand to two brands.
"We are told that on G-III's balance sheet we could probably afford up to US$500m of debt. We are debt-averse, but if the right opportunity comes along, we know that we could move quickly on that."
Miller said the size of potential businesses could be between $50m and $500m. "We feel pretty good that we have enough organic growth over the next several years. Then again, if the right opportunity comes along, we think we can move pretty quick on it."
Chief financial officer Neal Nackman reiterated the group's interest in adding to its portfolio, saying: "We feel very comfortable with our operating performance and the capital and debt structure we have to be able to take advantage of acquisition opportunities as we go into the future."
The comments come after G-III acquired Vilebrequin from Fashion Fund One in a deal worth EUR85.5m (US$106.2m) last year. Vilebrequin sold its products through a network of 185 owned and franchised speciality retail stores and through select wholesale distribution.
The apparel maker now aims to expand the Vilebrequin label in terms of products and stores - potentially in New York, Florida and California, according to Miller. "We're working very hard now and we're expanding the product categories."
"We feel pretty strongly that we can take this to the women's side with a women's wear ready-to-wear collection and swimwear," he added.
"With an acquisition like Vilebrequin, we can accelerate growth in the US by using their real estate team to find locations for Vilebrequin so we're very pleased with our retail segment. It should wrap up a good year and we should have even more growth into next year."
On an adjusted basis, excluding expenses associated with the Vilebrequin acquisition, the group expects full-year net income per share to range from $2.82 to $2.92, compared to previous guidance of between $2.74 and $2.84.
"We're think we're really back on track and we should put up a good year of sales and profits and also continued growth well into the future," Miller told investors at the conference.
The apparel maker, whose private-label brands include Jessica Howard, Eliza J and G-III, licenses its merchandise to select third parties. Its product portfolio includes outerwear, dresses, sportswear, swimwear, beachwear and and women's suits, as well as handbags and luggage.
It has fashion licenses under the Calvin Klein, Kenneth Cole, Jones New York, Tommy Hilfiger, Nine West and Ivanka Trump. The group's sports licenses include the National Football League and the National Hockey League.
G-III also operates retail stores under the Wilsons Leather, Calvin Klein Performance and Andrew Marc banners.
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