US: PVH Q1 profit soars 61% on Hilfiger, Calvin Klein
- Q1 net income rose 61% to $93.1m
- Revenue increased 4% to $1.43bn
- Calvin Klein up 7%, Hilfiger up 8%
Strong global demand for its Calvin Klein and Tommy Hilfiger brands has helped PVH Corp to a 61% surge in first quarter earnings - and prompted the New York based clothing firm to raise its full-year forecast.
The company said both brands performed above expectations despite cost pressures and economic headwinds in Europe - and are likely to continue this momentum despite the uncertain macroeconomic environment in both the US and Europe.
"We believe that the impact of the product cost increases that have negatively affected our industry will abate in the second half of 2012, which will have a positive impact on all of our businesses," noted chairman and CEO Emanuel Chirico.
He added: "We are excited about the continued execution of our growth strategies for our brands, particularly Calvin Klein and Tommy Hilfiger, as we expand our global footprint." The company said its new Tommy Hilfiger joint ventures in India and China "performed very well during the first quarter."
During the three months to 29 April, net income rose to $93.1m or $1.27 per share, up from $57.7m or $0.79 per share, in the same quarter last year.
Revenue, meanwhile, increased 4% to $1.43bn from $1.37bn. The Calvin Klein business saw its revenues rise 7% to $262.1m, with weakness in Europe offset by gains in North America, South America and Asia.
At Tommy Hilfiger, revenues were up 8% to $770.4m, helped by higher selling prices and same-store sales growth in North America and Europe.
"As we head into the second quarter, we are optimistic that the strength of our brands and the sound execution of our business strategies, along with our strong balance sheet, will continue to drive long-term growth and improvements in our financial metrics and business returns in 2012 and beyond," Chirico said.
Looking ahead, PVH expects full-year earnings per share in the range of $6.15 to $6.25, an increase of 14% to 16% over the prior year's $5.38, with sales increasing by 1% to 2%.
In the second quarter, earnings are seen rising 10-12% over the previous year to between $1.18 and $1.20, with revenues staying flat.
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