PVH Corp. said in a statement that its business was significantly impacted by the Covid-19 pandemic during the first quarter of 2020, resulting in an unprecedented decline in revenue and earnings, including 962 million dollars of pre-tax non-cash impairment charges during the quarter. First quarter revenue decreased 43 percent to 1.344 billion dollars, or decreased 42 on a constant currency basis compared to the prior year period. Loss per share on a GAAP basis was 15.37 dollars compared to earnings per share of 1.08 dollars and loss per share on a non-GAAP basis was 3.03 dollars compared to earnings per share of 2.46 dollars in the prior year period.
Commenting on these results, Emanuel Chirico, the company’s Chairman and Chief Executive Officer, said: “We are living through an unprecedented moment in history. While our first quarter results were impacted significantly by the pandemic, we have been able to reopen the majority of our stores in all regions over the last month. While it is still early, we are seeing improving traffic and conversion trends in most markets. At the same time, our digital commerce businesses continue to experience outsized growth, even as stores reopen.”
Store closures due to Covid-19 impact PVH business
The overall revenue decline, the company added was due to a 39 percent or 37 percent decrease on a constant currency basis in the Tommy Hilfiger business compared to the prior year period, including a 51 percent decrease in Tommy Hilfiger North America and a 32 percent decrease in Tommy Hilfiger International, a 46 percent or 45 percent decrease on a constant currency basis in the Calvin Klein business compared to the prior year period, including a 54 percent decrease in Calvin Klein North America and a 40 percent decrease in Calvin Klein International and a 47 percent decrease in the Heritage Brands business compared to the prior year period.
The company further said that as a result of the widespread temporary store closures and reduced traffic while stores were open, revenue in the company’s retail stores declined approximately 50 percent to 65 percent compared to the prior year period, depending on the region.
Also the temporary closures of the company’s wholesale customers’ stores resulted in a sharp reduction in shipments to these customers and an overall decline of 41percent in the company’s global wholesale revenue.
However, first quarter revenue reflected a 47 percent increase in sales through the Company’s directly operated digital commerce businesses driven by strong growth in all regions, which partially offset the decline in revenue through its other distribution channels.
Picture:Tommy Hilfiger website