Nautica Enterprises Inc on Tuesday reported a sharp rise in first quarter net sales as it delivered a healthy trading update sure to please its incoming owners, apparel giant VF Corp.

New York-based Nautica, which accepted a $586 million takeover bid from VF Corp last week, said revenue for the 13 week period ended May 31 rose 10.6 per cent to $139.2m from $125.9m in the year-ago period.

The company said sales of its wholesale segment rose 12.4 per cent year-on-year to $107.1m driven by demand for men's jeans, women's sleepwear, children's clothes and underwear.

Nautica, whose other brands include Earl Jean and John Varvatos, added retail sales edged up five per cent to $32.1m from $30.6m in 2002.

The firm added in a news release earnings from continuous operations for the latest quarter was $393,000, or one cent per diluted share, compared with a year-ago loss of $527,000, or two cents per share.

It continues to expect to report full year earnings in the range of 95 cents to $1 per share and sees second quarter earnings in the range of 31 cents to 32 cents per share.

Chairman, president and CEO, Harvey Sanders, commented: "This is an exciting time for the Nautica business as we move towards completing the previously announced plans to merge with VF Corp.

"We are particularly pleased with the company's first quarter earnings results, which were in-line with consensus estimates. Importantly, the strategic initiatives we have put in place over the last several months are beginning to yield tangible results.

"Of note, the company's key accomplishments this quarter include growing sales across many of the divisions and further rationalising the company's cost structure as evidenced by the improvement in the SG&A margin.

"These achievements, together with strong free cash flow and a collection of well recognized brand names, position the Nautica business well for the long-term."