REPORT_ PVH Corp reported 2013 second quarterresults with revenue increase of 47 percent to 1.965 billion dollars, as compared to the prior year’s second quarter. The increase was principally driven by the addition of approximately 507 million dollars of revenue related to the newly acquired Warnaco businesses, net of a reduction in licensing revenue attributable to Warnaco for the prior year. Also contributing to the increase was incremental revenue of 77 million dollars in the Tommy Hilfiger business, 43 million dollars in the pre-acquisition Calvin Klein businesses and 22 million dollars in the pre-acquisition Heritage Brands wholesale businesses, partially offset by a reduction of 13 million dollars in the Heritage Brands Retail business and 8 million dollars attributable to the Izod women’s and Timberland wholesale sportswear businesses that the company exited in 2012.
Earnings per share were 1.39 dollars on non-GAAP basis, which exceeded the company’s guidance of 1.35 dollars and the prior year’s second quarter earnings per share of 1.28 dollars. GAAP loss per share was 0.20 dollars as compared to the prior year’s second quarter earnings per share of 1.22 dollars, driven by the acquisition, integration and restructuring costs associated with the company’s acquisition of the Warnaco Group.
Commenting on these results, Emanuel Chirico, Chairman and Chief Executive Officer, noted, “We are pleased with our second quarter performance, which exceeded our previous guidance for both revenue and earnings per share, despite volatility in consumer spending during the second quarter, particularly highlighted by weakness in the United States and Europe. Our results for the quarter were driven by the outperformance of most of our newly acquired businesses coupled with organic growth in our Tommy Hilfiger and pre-acquisition Calvin Klein and wholesale Heritage Brands businesses, which more than offset the continued underperformance in our Tommy Hilfiger Japan, Bass retail and Calvin Klein Europe businesses.”
For the first half, company reported earnings per share were 3.29 dollars as compared to 2.61 dollars for the prior year on non-GAAP basis. Revenue on a non-GAAP basis was 3.905 billion dollars, which represents an increase of 1.141 billion dollars, or 41 percent. The increase was due to a 795 million dollars increase in the Calvin Klein business, an 8 percent, or 118 million dollars increase in the Tommy Hilfiger business and a 30 percent or 227 million dollars increase in the Heritage Brands business.
Revenue of 3.875 billion dollars on a GAAP basis was 30 million dollars lower than non-GAAP revenue due to sales returns accepted from certain Warnaco wholesale customers in Asia during the first quarter in connection with an initiative to reduce excess inventory levels.
The global environment continues to be challenging in most key markets. In light of the Warnaco integration and the uncertainty impacting the overall markets, the company remains cautious about the remainder of the year. The company currently projects that 2013 interest expense will be 195 million dollars to 200 million dollars and that the non-GAAP 2013 full year tax rate will be 25.5 percent to 26 percent. The New York-based company expects revenue in the third quarter to be approximately 2.2 billion dollars.