An increase in earnings and revenues from its Calvin Klein business helped Phillips-Van Heusen Corporation to a better-than-expected third quarter, but the apparel maker has lowered its fourth quarter and full year guidance amid a rapidly deteriorating economic environment.

The New York based company, which owns lines like Van Heusen, Izod and Arrow, and licenses brands including Geoffrey Beene, Kenneth Cole New York, and BCBG Max Azria, also said it was reviewing its operating structure, real estate portfolio and capital spending programs next year with a view to making savings.

"The recent and rapid deterioration in the overall economic environment in the US and abroad has decreased consumer confidence and spending beyond what we had previously anticipated," said chairman and chief executive officer Emanuel Chirico.

Net profit in the quarter to 2 November fell 11.8% to $53.7m, or $1.03 per share, from $60.9m, or $1.05 per share, a year earlier.

Excluding the cost of closing its Geoffrey Beene outlet division, earnings were $1.10, which was in line with the company's earlier guidance.

Sales rose 4% to $727.5m from $696.4m a year earlier, helped by a 9% rise in the Calvin Klein licensing business.

Wholesale and retail revenues were up 3%, driven by dress furnishings, the Calvin Klein men's sportswear and retail businesses, and the new Timberland wholesale men's sportswear business.

However, same-store sales fell 7% in the company's heritage brand outlet retail businesses, and overall retail comparable store sales declined 5%.

Inventory levels excluding new businesses were down 8%, which Chirico said "positions us appropriately for the fourth quarter."

But he added that the strengthening US dollar, slowing growth in international markets and more promotional selling were behind the decision to lower fourth quarter and full year guidance.

For the quarter, it expects same-store sales to be down between 8% and 13% in its total outlet retail business, with Calvin Klein licensing revenue flat with last year.

Quarterly earnings per share are seen at $0.35 to $0.45, with revenues rising 2-5% to $595m to $615m.

For the full year, earnings per share are expected to range from $3.00 to $3.10, excluding the Geoffrey Beene outlet exit costs.

Total fiscal revenue is projected at $2.51bn to $2.53bn, a rise of 3% to 4% over 2007.