US: Hilfiger costs push Phillips-Van Heusen to Q1 loss
- Swings to Q1 loss of $27.6m
- Exceeds guidance excluding Hilfiger costs
- Revenues rose 11% to $619.0m
Costs related to its recent acquisition of luxury label Tommy Hilfiger have pushed Phillips-Van Heusen Corporation to a first quarter loss, but the apparel maker says it remains excited about the growth prospects of the combined company.
"The Tommy Hilfiger business is performing well both in North America and internationally and similarly in the wholesale and retail components," said chairman and CEO Emanuel Chirico.
"We are acting quickly to align the two organisations and are focused on realising the opportunities we envisioned when we embarked on this transaction."
For the three months to 2 May, the company posted a loss of $27.6m or $0.53 per share, compared with a profit of $24.7m or $0.48 per share a year earlier.
Excluding the $104m in costs for the Tommy Hilfiger deal which completed earlier this month, the company beat guidance with earnings of $0.83 per share.
Phillips-Van Heusen Corp, whose brands include Calvin Klein and Izod, said revenues rose 11% to $619.0m.
Wholesale and retail revenues rose 11%, with a 12% rise in outlet retail same-store sales.
Global growth of the Calvin Klein brand's footwear, women's sportswear and dresses helped lift royalty revenue by 10% on a constant currency basis.
"The positive trends of the last several quarters have continued and we have seen strong gross margin recovery in our wholesale and retail businesses against last year's difficult first quarter," Chirico noted.
Looking ahead, Phillips-Van Heusen expects a second quarter loss of $1.25 to $1.23 per share and revenues of $1.08bn to $1.10bn, including costs and sales from the Tommy Hilfiger acquisition.
For the full-year, it sees earnings of $0.34 to $0.44 per share and revenues in the range of $4.35bn to $4.40bn.
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