US: Perry Ellis "disappointed" as it cuts outlook
- Expects Q4 sales decline of 16%
- EPS forecast at $0.02 to $0.05
- Gross margin expands 170 bps
Perry Ellis is "extremely disappointed" with its Q4 and FY results
Apparel maker Perry Ellis International said it is "extremely disappointed" with its fourth-quarter and full-year results as it cut its outlook on poor weather and a challenging retail environment.
For its fourth-quarter ended 1 February, Perry Ellis said it expects to report a 16% decline in revenues to US$216m versus sales of $258m a year earlier. Adjusted EPS is expected to be in the range of $0.02 to $0.05.
The company said its performance has been impacted by inclement weather across major parts of the country coupled with a challenging consumer spending environment across its distribution channels.
In its direct-to-consumer channel, lower mall traffic resulted in a comparable store sales decline of 4.8%. In wholesale, Perry Ellis said replenishment orders were essentially turned off for many retailers who were struggling to manage overall store inventories.
Gross margins expanded 170 bps, driven by a higher contribution from licensing revenues and higher margins in the golf apparel and Rafaella sportswear business.
For its full-year, however, Perry Ellis expects sales of around $912m and EPS in the range of $0.34 to $0.37. This falls below its prior forecast of 95 cents to $1.01 per share and revenue of $960m to $970m.
"We are extremely disappointed with our fourth quarter and full year results," said COO said Oscar Feldenkreis. "We experienced a very difficult environment, which required our customers to become more aggressive with promotions and limit new orders. We expect our customers to remain cautious and have adjusted our expectations for initial delivery and replenishment orders in fiscal 2015."
The company will report its fourth-quarter and full-year results the week of 7 April.
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