US: Warnaco lifts FY guidance as Q3 profit rises 3%
- Q3 profit up 12% to $29.7m
- Sales down 5% to $520.9m
- Lifts FY sales and earnings outlook
Net income for the three months to 3 October was $29.7m or $0.63 per share, compared to $26.5m or $0.56 per share, a year earlier.
Net revenues were down 5% to $520.9m thanks to adverse currency exchange rates, the company said, but fell less than 1% on a constant currency basis.
Gross margin, meanwhile, was down 260 basis points to 44% of net revenues.
By group, sportswear revenues fell 1% to $312.9m, intimate apparel net revenues dropped 11% to $177.8m, and swimwear revenues were down 5% to $30.2m - including a $3.6m charge to write-down inventory related to racing suits such as the Speedo LZR Racer that has been banned from use in competition.
"Our strong third quarter results, in the midst of a challenging environment, reflect the continuing positive contribution of our long-term growth initiatives," said Joe Gromek, Warnaco's president and CEO.
"We are off to a strong start to the fourth quarter and are encouraged and optimistic about the prospects for growth as we end 2009 and move into 2010" he continued.
As a result, Warnaco has raised its annual guidance, saying it now expects net revenues to fall by 3-5%, beating earlier forecasts for a drop of 7-9%.
Diluted earnings per share for the year are seen in the range of $2.70 - $2.80, bettering the $2.60 - $2.75 per share expected previously.
Click here for editorial insight into Warnaco's third-quarter results.
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