• Q1 earnings drop to US$7.8m
  • Gross margin expands to 34.1%
  • Sales drop 2%
Perry Ellis says it was encouraged by the results of the quarter

Perry Ellis says it was encouraged by the results of the quarter

Apparel business Perry Ellis has upped its earnings guidance for the full year, despite recording a drop in earnings and sales in the first quarter.

Earnings amounted to US$7.8m in the three months ended 3 May, compared to a net profit of $11.3m a year earlier. The quarter included costs associated with the streamlining and consolidation of operations.

Gross margin, however, expanded to 34.1% as compared to 33.8% in the same period of the prior year, reflecting a favorable business mix and reduced freight costs as a result of an infrastructure rationalisation programme initiated last year.

Total sales dropped 2% to $257m, impacted by the planned exits of certain private and retailer exclusive branded programmes.

President and COO Oscar Feldenkreis, said: "We were encouraged by the results of the quarter which were ahead of our expectations. Despite a slow start to the spring season, we experienced positive momentum beginning in April with particular strength in golf lifestyle apparel, Original Penguin as well as our Nike swim businesses."

The company reaffirmed its guidance for revenues in a range of $910m to $920m and upped its adjusted earnings per diluted share guidance to $0.80 to $0.95 per share from previous guidance of $0.75 to $0.90.