just-styles round-up of Q1 apparel and footwear industry results

just-style's round-up of Q1 apparel and footwear industry results

In the latest first-quarter filings from US apparel and footwear brands and retailers, PVH Corp saw revenues exceed guidance thanks to strength across the business, while Guess saw continued momentum in Europe and Asia push up earnings and sales. Dick's Sporting Goods raised its full-year outlook and Destination XL narrowed its net losses.

Boot Barn Holdings

Boot Barn Holdings outperformed its guidance in the first quarter, with net income climbing to US$6.8m from $0.8m last year. Gross profit rate was lifted by a 140 basis point increase in merchandise margin rate and 70 basis points of leverage in buying and occupancy costs. The higher merchandise margin was driven by more full-price selling and increased exclusive brand penetration. Net sales, meanwhile, rose 16.2% to $162m from $139.4m in the prior-year period. This was driven by an 11.6% increase in same store sales and the addition of 14 stores over the past 12 months.

Destination Maternity

US retailer Destination Maternity CEO Marla Ryan said that while she is encouraged by the firm's progress in the first quarter, there is more work to be done to unlock the company's full potential and improve its overall operating performance. For the period ended 5 May, net income totalled US$0.2m, compared to a net loss of $1.1m for the first quarter of fiscal 2017. Net sales, meanwhile, decreased 3% to $103.2m from $106.4m last year, while comparable sales were down 0.1%. E-commerce sales jumped 43% from the prior year first quarter. Gross margin totalled 53.7%, a decrease of 70 basis points from the comparable prior year gross margin.

Tailored Brands

Growth in its custom business, an enhanced delivery offering, and investment in omni-channel have all helped boost earnings and sales for Tailored Brands in its first-quarter. On a GAAP basis, net earnings were US$13.9m compared to $1.8m last year. On an adjusted basis, earnings were $25.3m from $13.3m last year. Consolidated gross margin was down 30 basis points to 42.2%. Total net sales, meanwhile, increased 4.5% to $818m. Men's Wearhouse comparable sales increased 3.2%, and Jos. A. Bank comparable sales increased 1.2%.

Vince Holding

Vince Holding CEO Brendan Hoffman said the company is pleased with the strong response to its women's and men's product assortments in the first quarter which drove a double digit comparable sales increase in its full price stores, and more than 25% growth in its e-commerce business. For the period ended 5 May, net sales decreased 6.1% to US$54.5m compared to $58m in the first quarter of fiscal 2017. Comparable sales increased 12.3%, including e-commerce sales, primarily due to an increase in transactions. Net loss, meanwhile, narrowed to $5.6m from $9.3m last year, while gross margin increased 270 basis points to 46.8%, largely due to lower sales allowances in the wholesale channel and a favourable shift in channel mix, partially offset by the unfavourable impact of adjustments to inventory reserves.

Oxford Industries

Thomas Chubb III, CEO of Oxford Industries, said the company successfully executed its plans during the first quarter and delivered sales at the high-end of its guidance range and earnings per share that exceeded expectations. In the period ended 5 May, consolidated net sales edged up to US$272.6m from $272.4m last year, while earnings on a GAAP basis were $1.23 per share compared to $1.03 in the same period of the prior year.  Gross margin widened to 60.2% compared to 58.5%, while net income reached $20.6m from $17.2m in the year-ago period.

G-III Apparel 

Morris Goldfarb, CEO of G-III Apparel, said the company is pleased to have begun the year with a solid quarter across the board.  For the period ended 30 April, the company reported net income of US$9.9m, compared to a net loss of $10.4m in the prior year's comparable period. Net sales meanwhile, increased16% to a first quarter record of $611.7m from $529m in the year-ago period. As a result, G-III Apparel has increased its prior guidance for the full fiscal year 2019 ending 31January 2019. The company now expects net sales of about $2.97bn and net income between $112m-$117m for fiscal 2019. The business previously forecasted net sales of about $2.94bn and net income between $97m-$102m for fiscal 2019.

Francesca's Holdings Corp

Steve Lawrence, president and CEO of Francesca's Holdings Corporation, said the company's first-quarter results were generally in line with its expectations and it is starting to see signs of progress across several areas of the business, despite moving to a loss in the period. For the quarter ended 5 May, net loss totalled US$3.9m, compared to net income of $4.3m in the comparable prior year quarter. Net sales, meanwhile, decreased 7% to $100.4m from $107.7m last year. The company said the decline was due to a 16% decrease in comparable sales compared to a 5% decrease in the comparable prior year quarter. The decrease in comparable sales was primarily due to a decline in boutique traffic and conversion rates, and was partially offset by sales from 65 net new boutiques added since the comparable prior year quarter. Gross margin narrowed to 38.2% from 45.2% in the comparable prior year quarter.  Francesca's said the unfavorable variance was due to deleveraging of occupancy costs as well as a decrease in merchandise margin.  The decrease in merchandise margin was due to increased markdowns.

Perry Ellis

Oscar Feldenkreis, CEO of Perry Ellis, said the firm is very pleased with its start to fiscal 2019, which continued its momentum from last year. For the period ended 5 May, total revenue reached US$255m, a 5.4% increase compared to $242m reported in the first quarter of fiscal 2018. The increase reflected increases in the company's core brands and in particular golf and Nike Swim, along with a double-digit increase in comparable store sales in the direct-to-consumer channel.  The increase in revenue includes a $1.5m increase due to the adoption of the new revenue recognition standard, which requires advertising reimbursements to be classified as revenue instead of as a reduction of the related advertising costs as was the case in fiscal 2018.  This growth was offset by declines in the women's business. Net income, meanwhile, slipped to $10.2m from $12.8m last year. Adjusted net income totalled $12.1m, compared to $12.8m in the year-ago period. GAAP gross margin narrowed to 36.8% from 37.6% in the first quarter of fiscal 2018, driven by changes in product mix and the change in the accounting standard for revenue recognition which shifts licensing revenues to the fourth quarter rather than spreading revenues evenly throughout the year.  Adjusted gross margin was 36.8% compared with adjusted gross margin of 37.6% in the first quarter of fiscal 2018.


Footwear retailer Caleres booked an increase in both profit and revenue during the first quarter. For the 13 weeks to 5 May, net earnings amounted to US$17.2m, compared to $14.9m in the year-ago period. Gross margin of 43.5% was up 59 basis points, while consolidated sales edged up to $632.1m from $631.5m in the prior year. Famous Footwear total sales of $363.4m were down 0.8%, as were same-store-sales while the company said it operated 39 fewer doors year-over-year. Brand portfolio sales meanwhile, rose 1.4% to $268.7m.


David Kornberg, CEO of speciality retail apparel company Express, said the company's first quarter performance demonstrates its strategy and holistic approach to driving improved sales and profitability is working. During the 13 weeks to 5 May, comparable sales grew for the first time since late 2015, increasing 1%, compared to a 10% decrease in the first quarter of 2017. Net sales, meanwhile, increased 1% to US$479.4m from $474.2m in the year-ago quarter, while e-commerce sales increased 35% year-on-year to $132.6m. Net income reached $0.5m in the period, compared to a net loss of $2.7m last year. Gross margin improved 200 basis points to 29.9% of net sales compared to 27.9% in last year's first quarter. The improvement was driven by a 90 basis point increase in merchandise margin and a 110 basis point decrease in buying and occupancy costs as a percentage of net sales.

Abercrombie & Fitch Co

Fran Horowitz, CEO of US apparel retailer Abercrombie & Fitch Co, said the company is pleased with its performance  across all brands in the first quarter as net loss attributable to the firm narrowed to US$42.5m, compared to $61.7m last year. Gross margin expanded to 60.5%, up 20 basis points from last year. Net sales, meanwhile, reached $730.9m, up 11% from $661.1m last year, with comparable sales up 5%. Changes in foreign currency exchange rates and the calendar shift resulting from the 53rd week in fiscal 2017 benefited first quarter net sales by approximately 4% and 1%, respectively, which do not impact comparable sales.  By brand, net sales increased 13% to $423.6m for Hollister and were up 7% to $307.3m for Abercrombie from last year. By geography, net sales climbed 10% to $449.1m in the US and by 12% to $281.8m in international markets from last year.

Burlington Stores

Burlington Stores has booked first-quarter results above management guidance and increased its full-year sales and earnings guidance. Net income increased 58% to US$83m, driven primarily by top line growth, expense leverage, share repurchases and lower tax rates. Gross margin expanded 35 basis points to 41.2% thanks to increased merchandise margin, while total sales were up 12.8% to $1.52bn. Comparable store sales increased 4.8%. For the full year, the company is forecasting total sales to increase in the range of 9.7% to 10.5%, and adjusted EPS to be in the range of $5.90 to $6.00.

American Eagle Outfitters

American Eagle Outfitters CEO Jay Schottenstein said he is very pleased to see the company continued its momentum in the first quarter. Net income reached US$39.9m in the period, compared to $25.2m last year, while gross margin rate increased 50 basis points to 37% compared to 36.5% last year, reflecting rent leverage and a favourable markdown rate, partially offset by increased digital delivery expense. Total net revenue, meanwhile, increased 8% to $823m, compared to $762m last year, while consolidated comparable sales increased 9% over the comparable period ending 6 May 2017.

Dollar General

Dollar General CEO Todd Vasos said the company is proud of its execution and solid performance, particularly given the significant weather-related headwind it faced during the first quarter. For the 13 weeks ended 4 May, totalled US$365m, compared to $279m in the year-ago period. Net sales, meanwhile, increased 9% to $6.1bn, while same-store sales increased 2.1% due to an increase in average transaction amount, partially offset by a decline in customer traffic. Gross margin edged up to 30.5% from 30.3% last year, an increase of 17 basis points. The firm attributed the increase primarily to higher initial markups on inventory purchases and an improved rate of inventory shrink.

Dollar Tree

US discount retailer Dollar Tree booked top-line sales and bottom-line earnings results within its range of guidance for the first quarter. Net income decreased US$40m to $160.5m. Consolidated net sales, meanwhile, increased 5% to $5.55bn from $5.29bn last year. Enterprise same-store sales increased 1.4%, while same-store sales for the Dollar Tree banner increased 4% on a constant currency basis. Gross margin decreased to 30.6% compared to 30.8% in the prior year due to higher shrink, distribution and occupancy costs, partially offset by lower markdowns and lower merchandise costs.

PVH Corp

PVH Corp booked growth in both earnings and sales in its first-quarter, exceeding revenue guidance thanks to broad-based strength across the business and continued momentum in its Calvin Klein and Tommy Hilfiger brands. Earnings reached US$179.4m from $70.4m, while net sales grew 16% to $2.31bn. Sales increased across all brands, and the company raised its outlook for the full year. It now expects EPS on a GAAP basis to reach $8.81 to $8.91 from $8.76 to $8.86 previously, and on a non-GAAP basis to reach $9.05 to $9.15 from $9.00 to $9.10 previously.


Victor Herrero, CEO of Guess Inc, said he was pleased the company's first-quarter results finished above the high-end of its expectations for revenues, adjusted operating margin and adjusted earnings per share. For the period ended 5 May, total net revenue increased 14.7% to US$521.3m, compared to $454.3m in the prior-year quarter, driven by continued momentum in Europe and Asia where sales were up 24.2% and 32.6% respectively. Sales in the Americas were down 1.4%. In constant currency, net revenue increased by 7.7%. Adjusted operating margin was negative 3.9%, an improvement of 100 basis points on last year. Meanwhile, Guess recorded a GAAP net loss of $21.2m, a 0.3% improvement compared to $21.3m last year. GAAP diluted loss per share deteriorated 3.8% to $0.27. 

Destination XL

Destination XL has booked a rise in revenue and narrowed its net loss in the first quarter. The company said net losses totalled US$3.1m compared to last year's net loss of $6.1m. Total sales, meanwhile, reached $113.3m, up 5.3% from $107.6m in the prior-year. The increase was primarily due to a comparable sales increase of 2.2% and an increase in non-comparable sales of $3.2m. Gross margin rate, inclusive of occupancy costs, was down 50 basis points to 44.7% due to a decrease in merchandise margins of 120 basis points partially offset by a 70 basis point improvement in occupancy costs as a percent of sales.


Tilly's moved to a profit in the period as net income reached US$1.2m, compared to a net loss of $0.2m last year. Total net sales were also up, rising 2.2% to $123.6m from $120.9m in the prior-year quarter, primarily due to the calendar shift impact of last year's 53rd week in the retail calendar. Comparable store sales, which includes e-commerce sales, increased 0.1%, while e-commerce sales were down 7.2% for the quarter. Gross margin increased to 28.3% from 27.2% last year thanks to a 120 basis point reduction in buying, distribution and occupancy costs. Product margins declined 10 basis points as a result of lower initial markups.


Roger Rawlins, CEO of DSW said the company is pleased to report its second consecutive positive comp and the fourth positive footwear comp in the DSW brand. For the quarter ended 5 May, net income totalled $24.3m, compared to $22.8m last year. The figure included net after-tax charges totaling $7.2m related to the exit of Ebuys, foreign exchange losses and transaction costs related to the acquisition of Town Shoes. Total revenue, meanwhile, increased by 2.9% to $712m, including $5.6m from residual Ebuys operations. Comparable sales were up 2.2% over last year. Reported gross profit, as a percentage of sales, increased by 40 basis points due to the wind-down of Ebuys.

Dick's Sporting Goods

Dick's Sporting Goods has raised its full-year outlook on the back of what CEO Edward Stack called "strong" first-quarter earnings. For the period ended 5 May, consolidated net income totalled US$60.01m, compared to $58.2m in the year-ago quarter. Net sales, meanwhile, increased 4.6% to $1.91bn from $1.83bn last year. Adjusted for the calendar shift due to the 53rd week in 2017, consolidated same store sales decreased 2.5% on a 13-week to 13-week comparable basis. Based on an unshifted calendar, consolidated same store sales for the first quarter decreased 0.9%. 


Despite strong inventory management and targeted promotions, customer traffic remained challenging for Chico's in the first quarter, weighing on earnings, which dropped to US$29m from $33.6m in the year ago quarter. Gross margin narrowed to 40.4% from 40.7% due to implementation costs and the launch of a new shipping programme. Net sales were down 3.8% to $561.8m, reflecting a comparable store sales decline of 5.9% due to 41 store closures.

The Buckle

The Buckle saw earnings grow 12.3% to US$18.3m in the first quarter. Net sales for the 13 weeks ended 5 May dropped 3.5% to $204.9m from $212.3m a year earlier. Comparable store net sales, however, were down 3.1%, while online sales grew 6.1% to $23.1m.

Foot Locker

A good flow of premium product helped Foot Locker record a sales increase of 1.2% to US$2.01bn in the first quarter. Comparable sales, however, were down 2.8%. Net income was also down, dropping to $165m from $180m last year. The result included an incremental $12m charge related to the company's pension litigation. Gross margin narrowed to 32.9% from 34% a year ago.

Ross Stores

Ross Stores CEO Barbara Rentler said despite unfavourable weather throughout the period, the firm achieved above-plan growth in both sales and earnings in the first quarter. Net earnings reached US$418m, compared to $321m in the prior year, while sales increased 9% to $3.6bn from $3.3bn. Comparable store sales for the 13 weeks grew 3%. Operating margin for the period of 15.1% was down slightly from the prior year as an improvement in merchandise gross margin and favourable timing of packaway-related expenses were offset by higher freight costs and wage-related investments."

Shoe Carnival

Cliff Sifford, CEO of Shoe Carnival, said the firm is pleased with its start to the year after booking a rise in both earnings and revenue in the first quarter. For the period ended 5 May, net income reached US$13m, compared to $8.2m last year, while net sales climbed 1.6% to $257.4m from $253.4m in the year-ago quarter. Comparable store sales for the thirteen-week period were up 1.3%. Gross profit margin, meanwhile, increased 150 basis points to 30% compared to 28.5% in the first quarter of fiscal 2017.

L Brands

L Brands has reported a 49.5% drop in earnings for the first quarter as net income fell to US$47.5m from $94.1m in the year-ago period. Net sales, meanwhile, totalled $2.6bn, an increase of 8% compared to sales of $2.4bn last year, while comparable sales increased 3% compared to the prior yearquarter. The company has decreased its guidance for 2018 full-year earnings per share to $2.70 to $3.00 from $2.95 to $3.25 previously.


US department store retailer Target has reaffirmed its full-year guidance as CEO Brian Cornell says the company has made significant progress in support of its long-term strategic initiatives during the first quarter. Total revenue reached US$16.8bn in the period, up 3.4% from $16.2bn last year, reflecting comparable sales growth of 3% combined with the contribution from non-mature stores. Comparable digital channel sales grew 28%and contributed 1.1 percentage points of comparable sales growth. Gross margin rate in the period was 29.8%, compared with 30% in 2017, reflecting pressure from digital fulfilments costs and sales mix, partially offset by the benefit of the company's cost saving efforts and the net impact of changes to its pricing and promotions. For full-year 2018, Target continues to expect a low-single digit increase in comparable sales, and both GAAP EPS from continuing operations and adjusted EPS of $5.15 to $5.45.

TJX Companies

Ernie Herrman, CEO of TJX Companies, said the firm is very pleased with its first quarter-results as both its consolidated comp store sales growth and earnings per share exceeded its expectations. For the first quarter ended 5 May, net sales increased 12% to US$8.7bn from $7.8bn last year, while consolidated comparable store sales increased 3% over the year-ago period. Net income, meanwhile, reached $716.4m, a 33.6% increase from $536.3m last year. Diluted earnings per share were $1.13, compared to $0.82 last year, while gross profit margin was 28.9%, down 0.1 percentage point versus the prior year. 


Michelle Gass, CEO of US department store retailer Kohl's, said the business is very pleased with its "strong" start to fiscal 2018 as net income rose 13.6% in the first quarter to US$75m, compared to $66m last year. Net sales also increased, reaching $3.95bn from $3.81bn in the year-ago period. Comparable sales, meanwhile, increased 3.6% while gross margin was up 50 basis points to 36.9%, compared to 36.4% last year. Kohl's said it now expects its adjusted fiscal 2018 diluted earnings per share to be $5.05 to $5.50, compared to its prior guidance of $4.95 to $5.45.

Urban Outfitters

Urban Outfitters has booked record first-quarter sales and a jump in earnings, with growth across all brands. Net income reached US$41.3m from $11.9m last year, while gross profit rate increased by 130 basis points, primarily driven by lower markdowns at all three brands. Net sales grew 12.4% to a record $856m thanks to comparable retail segment sales growth of 10%, driven by strong, double-digit growth in the digital channel and positive retail store sales. By brand, comparable sales increased 15% at Free People, 10% at the Anthropologie Group and 8% at Urban Outfitters.


Nordstrom has booked a rise in both profit and revenue in the first quarter. For the period ended 5 May, net earnings reached US$87m, up 38% from $63m in the year-ago quarter. Gross margin decreased 21 basis points to 34.1% compared with the same period in fiscal 2017, reflecting higher occupancy expenses related to US and Canada Rack openings in addition to planned pre-opening expenses associated with the Nordstrom Men's Store NYC. Net sales, meanwhile, increased 5.8% to $3.5bn from $3.3bn last year. Comparable sales edged up 0.6% compared with the 13-week period last year.


US retailer Walmart has booked a mixed first-quarter as sales grew but earnings remained flat. For the three months ended 28 April, total revenues grew 4.4% to US$122.7bn. US comparable sales were up 2.1%, while traffic increased 0.8%. In the retailer's international stores, sales grew 11.7% to $30.3bn. Eight of Walmart's 11 markets posted positive comparable sales, including its four largest. Operating profit, however, remained flat at $5.2m.


Dillard's continued its positive sales momentum in the first quarter a net sales increased 3.5% to US$1.46bn in the period from $1.41bn last year. Net income was also up, climbing 21.4% to $80.5m from $66.3m last year. Meanwhile, gross margin from retail operations declined 31 basis points compared to the prior year first quarter.

The Children's Place

Jane Elfers, CEO of children's speciality apparel retailer The Children's Place, said the company's ability to sell seasonal product in the first quarter was severely hampered by the combination of a record number of winter storms and the unseasonably cold temperatures that persisted across major markets. For the 13 weeks ended 5 May, net income slipped 13% to US$31.5m from $36.2m in the previous year. Net sales, meanwhile, slipped 0.1% to $436.3m, while comparable retail sales decreased 1.8%.

JC Penney

Department store retailer JC Penney booked a mixed first-quarter as it narrowed its net loss to US$78m from a loss of $187m in the same period last year, but saw its sales drop 4.3% to $2.58bn. The decline was primarily due to 141 store closures. Comparable sales edged up 0.2% in the quarter, impacted largely by a very late start to spring. The retailer revised its 2018 full-year guidance and now expects comparable store sales to remain at 0.0% to 2%, and adjusted earnings per share to be ($0.07) to $0.13.


Department store retailer Macy's exceeded its expectations in the first quarter and saw a strong performance across all three of its brands and all geographic regions. Earnings reached US$139m from $78m a year earlier, while sales were up 3.6% to $5.54bn. Comparable sales on an owned basis grew 3.9%, and by 4.2% on an owned plus licensed basis. The company says it will now manage its China business itself, with support from Fung Omni, after ending its joint-venture with Fung Retailing. For the full year, Macy's has upped its forecast to adjusted earnings per diluted share of $3.75 to $3.95, and total sales to range from a 1% decline to a 0.5% increase.

Differential Brands Group

Differential Brands Group, which owns the Robert Graham and Hudson Clothing brands, widened its net loss in the first quarter. For the three months ended 31 March, net loss totalled US$4.09m, compared to $2.35m in the year-ago period. Net sales, meanwhile, decreased 3% to $38.8m from $40.1m last year, reflecting a 12% increase in consumer direct segment sales and an 8% decrease in wholesale segment sales. Gross profit margin on a comparable basis was 41.9% compared to 42.9% last year.

Iconix Brand Group

Iconix has reiterated its full-year guidance amid first-quarter results that were in line with company's expectations. For the period ended 31 March, net income totalled US$32.7m, compared to a net loss of $4.3m last year. Total revenue, meanwhile, was $48.5m, a 17% decline as compared to $58.7m in the prior-year quarter. Such decline was expected principally as a result of the transition of the firm's Danskin, Ocean Pacific and Mossimo direct-to-retail labels in its women's segment, as previously announced. Iconix said revenue in the first quarter of 2017 included about $1m of licensing revenue from its Southeast Asia joint venture which was deconsolidated in the second quarter of 2017. As a result, there was no comparable revenue for this item in the first quarter of 2018. Excluding Southeast Asia, revenue declined approximately 16% for the first quarter of 2018.

VF Corp

US apparel giant VF Corporation has posted total revenues that beat its expectations for the three month transition quarter to 31 March. Sales in the period reached US$3.05bn, up 22% from $2.5bn, and surpassing the $2.9bn forecast by the company last quarter.  Global brand revenue at Vans was up 45%, and by 11% and 5% at The North Face and Timberland respectively. Net income in the period, meanwhile, totalled $252.8m, a 21% increase on earnings of $209.2m last year. Gross margin improved 20 basis points to 50.5% as benefits from a mix-shift toward higher margin businesses and changes in foreign currency were partially offset by the impact of the Williamson-Dickie acquisition.


Apparel maker HanesBrands has reported first-quarter sales results that exceeded company guidance. For the period ended 31 March, net sales were up 7% to US $1.47bn  versus a guidance range of $1.42bn to $1.44bn. Net sales for Bras N Things, acquired in February 2018, and Alternative Apparel, acquired in October 2017, totalled $32m in the quarter. Sales for the activewear and international segments increased by 6% and 19% respectively, while sales decreased by 3% as expected for the innerwear segment. Net income, meanwhile, increased 12.5% to $79.4m from $70.6m in the year-ago period.

Under Armour

Under Armour CEO Kevin Plank remains confident in the firm's ability to deliver on its full-year targets, despite a widening of its net loss in the first quarter. For the period ended 31 March, net loss totalled US$30.2m, compared to $2.3m in the year-ago quarter. Excluding the impact of the firm's restructuring plan, adjusted net income was $1m. Net revenues, meanwhile, reached $1.2bn, up 6% from $1.1bn last year. North America revenue was relatively flat, while the international business continued to deliver strong growth with a 27% increase, representing 24% of total revenue. The EMEA, Asia-Pacific and Latin America all recorded increases, of 23%, 35% and 21%, respectively. Apparel revenues, meanwhile, were up 7%, while footwear revenues climbed by 1%. Accessories sales edged up 3%, led by men's training. Gross margin declined 120 basis points to 44.2% as benefits from changes in foreign currency rates were more than offset by accelerated inventory management initiatives.

Columbia Sportswear

Columbia Sportswear has upped its full-year guidance on the back of record earnings and revenue in the first quarter. Net income increased 25% in the period to US$45.1m, compared to $36m last year. Net sales, meanwhile, climbed 12% to reach $607.3m from $543.8m in the year-ago period. Gross margin increased 180 basis points to a record 49.3% from 47.5% last year. Looking ahead, the company currently expects 2018 net sales growth of about 8%-10% and 2018 net income to come in between  $213m and $220m as a result of better than expected first quarter net sales and profitability.


Excluding the unusual charge related to the Toys 'R' Us bankruptcy, Carter's achieved its sales and earnings objectives in the first quarter, according to CEO Michael Casey. Net sales in the period increased 3.1% to US$755.8m from $732.8m, principally driven by growth in the company's US retail and international segments including contributions from the 2017 Skip Hop and Mexico licensee acquisitions, partially offset by a net sales decline in the US. Net income in the first quarter of fiscal 2018 however, decreased $4.1m, or 8.9%, to $42.5m, compared to $46.6m last year.

Rocky Brands

US apparel and footwear company Rocky Brands booked a mixed first-quarter as earnings climbed but sales slipped. For the period ended 31 March, net income reached US$3.3m, compared to $1.5m in the year-ago quarter. Net sales, meanwhile, slipped to $61.4m from $63.1m last year. Gross margin expanded to 34.2% from 31.3% for the same period last year. The company said the 290 basis point increase was driven by higher wholesale and military margins combined with a lower percentage of military sales, which carry lower gross margins than wholesale and retail sales.

Steve Madden

Edward Rosenfeld, CEO of US footwear and accessories specialist Steve Madden, said the company got off to a good start in 2018, with first quarter results that exceeded expectations. Net income for the three months ended 31 March were US$28.7m, compared to $20.2m in the prior year. Total net sales, meanwhile, increased 6.2% to $389m, from $366.4m a year ago. Net sales for the wholesale business increased 5.8% to $331.2m, while retail net sales rose 8.6% to $57.9m. Same store sales decreased 1.2% in the quarter as the result of a decline in the boot category, while gross margin was flat at 36.2%.

Levi Strauss & Co

Jeans giant Levi Strauss & Co saw net income decline US$79m in the first quarter due to a $136m provisional non-cash tax charge as a result of the enactment of the 2017 Tax Cuts and Jobs Act. As a result, net loss in the period totalled $19m, compared to net income of $60.1m last year. The San Francisco-based company said excluding this non-cash charge, adjusted net income was $117m, nearly double last year's $60m. Net revenues, meanwhile, were up 22% to $1.34bn from $1.1bn in the year-ago period. In Europe, net revenues were up by 46%, while in the Americas and Asia sales grew by 14% and 9% respectively. Gross margin expanded to 54.9% from 51.2%, reflecting the margin benefit from revenue growth in the direct-to-consumer channel and international business, lower product sourcing costs and a favourable transactional impact of currency.

Looking ahead, the company raised its full-year 2018 revenue growth guidance to a 6%-8% range in constant currency.

Skechers USA

Casual footwear brand Skechers USA achieved a new quarterly sales record, with net sales soaring 16.5% to US$1.25bn in the quarter to 31 March. Skechers said the rise was the result of a 17.9% increase in the company's international wholesale business, an 8.5% increase in domestic wholesale sales, and a 26.4% increase in company-owned global retail sales. Comparable same store sales in company-owned stores worldwide increased 9.5%, including 7% in the US and 17.6% internationally, as compared to the first quarter of 2017. Net income was up 25.2% to $117.7m from $94m a year earlier, while gross margin widened to 46.7% from 44.4% due to strength in the company's international subsidiary and company-owned international retail businesses.