PVH Q2 profit rises despite sales decline on weak performance | kbnmart

PVH Corp said Tuesday its revenue fell 6% to $2.074 billion in the second quarter, hurt by lower sales in the U.S. company’s overseas markets, particularly in the Asia-Pacific region.

The owner of Calvin Klein and Tommy Hilfiger said second-quarter revenue was negatively impacted. The company said in a press release that the “challenging consumer environment” in the Asia-Pacific region, particularly in China and Australia, coupled with its planned sales cut in Europe “in order to drive overall sales quality in the region.”

In North America, revenues at Tommy Hilfiger and Calvin Klein combined increased 1% year-over-year, with modest growth in wholesale and a low single-digit decline in direct-to-consumer.

Despite the decline in global sales, PVH’s net income rose to $158 million during the three months, compared to net income of $94.2 million last year. Earnings per share were $2.80, compared to $1.50 in the same period a year earlier.

“We met our revenue and expense commitments and exceeded our second-quarter earnings expectations, driven by our disciplined execution of the PVH+ plan,” said Stefan Larsson, CEO of PVH. “For both Calvin Klein and Tommy Hilfiger, we strengthened consumer engagement and continued to drive product strength and freshness in our assortment, resulting in increased full-price sales and fewer end-of-season clearance sales, resulting in significant gross margin expansion.”

“Step by step, we continue to build strength in product, consumer engagement and market execution, supported by data-driven and demand-driven supply chain building. North America remains a strong proof point, in Europe, we are building on our targeted sales quality initiatives, and in Asia Pacific, we continue to drive strong brand engagement to win big consumer moments. Looking ahead, as we navigate an increasingly challenging global economic backdrop, we remain relentlessly focused on delivering long-term growth that will drive brand growth.”

Looking to the future, PVH rThe company confirmed its full-year sales forecast to decline by 6% to 7% compared to 2023, including a 2% decline due to the sale of the Heritage Brands women’s underwear business and a 1% decline for the 53rd week of 2023. Earnings per share expectations improved to a range of $11.20 to $11.45, compared to $10.76 in 2023. The previous guidance was in the range of $11.15 to $11.40.