Phillips-Van Heusen Corp. (NYSE:PVH) reported a second-quarter loss as a result of acquisition costs related to the company’s merger with Tommy Hilfiger, but revenue soared and adjusted earnings per share beat expectations.
The apparel giant boosted its full-year forecast, to earnings in the range of $3.70 to $3.80 a share on revenue between $4.4 billion and $4.47 billion. That’s a 15 cent increase from the company’s previous earnings-per-share range of $3.55 to $3.65, and an increase from the earlier revenue view for sales of about $4.4 billion.
The new forecast beat estimates, as analysts polled by Thomson Reuters had predicted full-year earnings of $3.62 a share on revenue of $4.38 billion.
The retailer said it expects adjusted third-quarter earnings in the range of $1.37 to $1.42 a share, on revenue between $1.42 billion and $1.44 billion. That forecast was in-line with expectations; the Street is looking for earnings of $1.42 a share on revenue of $1.43 billion.
In the fiscal second quarter, the apparel retailer weighed in with a loss of $54.6 million, or 83 cents a share, down from last year’s quarterly profit of $26.6 million, or 51 cents a share. Adjusted earnings improved to 72 cents a share, up from year-ago earnings of 60 cents a share, when adjusting to exclude acquisition-related costs.
Revenue soared to $1.1 billion, up from year-ago sales of $529.28 million, as Tommy Hilfiger added $532.2 million in revenue.
The quarter was better-than expected. Analysts had predicted adjusted earnings of 54 cents a share on revenue of $1.09 billion.
Gross margin rose to 52.1%, up from 50.2%, one year ago. Chairman and chief executive Emanuel Chirico said in a statement the company was “extremely pleased” with second-quarter results.
“We saw growth across each of our businesses in the quarter, and we are particularly excited about the exceptional performance of the Tommy Hilfiger business,” Chirico said. “We continued in the second quarter to see improvements in our gross margins over the prior year's results for our Heritage Brands and Calvin Klein Apparel businesses, with the Calvin Klein Licensing segment also delivering a royalty revenue increase of 11% over the prior year."
Shares of Phillips-Van Heusen fell 1.2% in Tuesday’s session, but the stock was up 80 cents, or 1.6%, after the market closed on the strength of the results. Shares of the company have rallied 14% in the past six months.