G-III Apparel Q2 Results Top Estimates, Boosts 2014 Outlook

(RTTNews) - Apparel maker G-III Apparel Group Ltd. (GIII) reported Wednesday a profit for the second quarter that more than doubled from last year, reflecting strong double-digit revenue growth. Both earnings per share and quarterly revenues topped analysts' expectations.

The company also provided earnings guidance for the third quarter, below Street view, but raised its earnings and sales forecast for the full-year 2014.

"We had an excellent second quarter. The results were driven by broad-based strength across many categories and brands in our portfolio. We believe that we are executing particularly well in a number of key areas, including design and merchandising, which positions us to deliver strong performance for the remainder of the year," Chairman and CEO Morris Goldfarb said in a statement.

The New York-based maker of Andrew Marc, Marc New York, Jessica Howard brands reported net income of $3.59 million or $0.17 per share for the second quarter, lower than $1.36 million or $0.07 per share in the prior-year quarter.

On average, ten analysts polled by Thomson Reuters expected the company to report earnings of $0.10 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter grew 21 percent to $304.16 million from $251.48 million in the same quarter last year, and topped seven Wall Street analysts' consensus estimate of $287.88 million.

Operating profit for the quarter grew to $7.13 million from $3.29 million in the year-ago quarter, and gross profit totaled $99.42 million, up from $74.84 million in the prior-year quarter.

Meanwhile, selling, general and administrative expenses also increased to $89.04 million from $69.45 million last year. "We have a powerful opportunity to continue to diversify our business, further penetrate key categories and layer on promising new organic growth initiatives, such as our multi-category launch of the Ivanka Trump collection and the rollout of full-priced Wilsons stores, which is still in a test mode. Our most recent acquisition, Vilebrequin, is performing well and provides us with a premier status brand in a new category," Goldfarb stated.

Looking ahead to the third quarter, the company expects earnings in a range of $2.52 to $2.62 per share, on projected net sales of about $620.0 million, while analysts anticipate earnings of $2.67 per share, on quarterly sales of $596.88 million.

For fiscal 2014, G-III Apparel raised its earnings forecast to a range of $3.30 and $3.40 per share from the prior guidance range of $3.20 and $3.30 per share. The company also now projects net sales of about $1.61 billion, up from the previous guidance of about $1.57 billion.

Street is currently looking for full-year 2014 earnings of $3.30 per share, on annual sales of $1.57 billion.

"We believe that by focusing on the right mix of key, strategic opportunities and maintaining a disciplined approach to investment, we can continue to drive superior value to the full range of our constituents, including our customers, consumers, partners and shareholders," Goldfarb added.

GIII closed Tuesday's regular trading session at $47.01, up $0.86 on a volume of 0.20 million shares.