New York—Blaming a warmer-than-usual winter that hurt its apparel sales, G-III Apparel Group Ltd. reported Thursday that its fourth-quarter earnings dropped 59%.
For the quarter ended Jan. 31, the company, which holds licenses for Calvin Klein, Sean John, Kenneth Cole, Cole Haan, Guess?, Jones New York, Jessica Simpson and Vince Camuto among others, posted a net profit of $5.1 million, or 25 cents a share, down from $12.3 million, or 62 cents a share, a year ago. Net sales rose 9% to $294.3 million.
That missed analysts’ average expectations for earnings of 28 cents a share on revenue of $310.8 million.
“Although we achieved record sales in fiscal 2012 ($1.23 billion), the record breaking warm weather was a major factor in our disappointing fourth quarter performance,” said Morris Goldfarb, chairman/ceo. “Having managed through fiscal 2012 gives us comfort for a more successful fiscal 2013.”
Goal: To Be Premier Branded Supplier of Sportswear, Handbags and Luggage
As for the next year, Goldfarb said the company has “compelling” opportunities across several brands and categories.
“Both dresses and sports are showing a strong increase in their respective order books. Calvin Klein handbags and luggage are both on track to show good growth and have a solid second year,” Goldfarb said. “Today we are the premier branded outerwear and dress supplier to retailers across the country. It is our goal to also be the premier branded supplier of sportswear, handbags and luggage.”
For its fiscal 2013 forecast, G-III Apparel expects a profit of $2.62 to $2.72 a share, while analysts’ average forecast earnings of $3.14 a share.
In other news on Thursday, the company announced a joint venture agreement with China Ting Group Holdings Limited to open and operate Calvin Klein Performance retail stores in China and Hong Kong, under the Calvin Klein Performance store license previously granted to G-III by Calvin Klein, Inc., a wholly owned subsidiary of PVH Corp.
G-III will retain 51% ownership of the joint venture which expects to begin operating retail locations in major Chinese markets starting in Fall 2012.