- Prachi Singh |
Perry Ellis International’s third quarter revenue totalled 205.4 million dollars. Adjusted diluted earnings per share increased to 0.16 dollar as compared to adjusted diluted earnings per share of 0.03 dollar in comparable period of prior year. Diluted GAAP Earnings per share were 0.15 dollar, as compared to a loss of 0.03 dollar comparable period of prior year.
”We had a strong third quarter highlighted by growth across our key lifestyle brands of Perry Ellis, Rafaella and Golf Lifestyle, expansion in gross margin and expense discipline which drove a more than fivefold increase in adjusted diluted earnings per share. Revenues declined in total driven by the strategic sale of C&C California and the transition of certain exclusive labels to our national, lifestyle brands,” Oscar Feldenkreis, President and Chief Operating Officer of Perry Ellis International.
Fiscal 2016 third quarter results
The company reported increases in its core global brands, Perry Ellis, Rafaella and Golf Lifestyle, across international, licensing and direct-to-consumer (DTC) businesses. This was offset by the loss of revenues associated with the divestiture of C&C California as well as private and exclusive brand reductions over the prior year. The reduction is in line with the company's continued focus to narrow its portfolio to its national brands and to steer smaller brands to a licensed model.
Gross margin was 35.7 percent, representing a 240 basis point improvement over the same period last year. The expansion reflects benefits from stronger sell-through performance at retail in the Perry Ellis, Original Penguin and Golf Lifestyle collection businesses, and favorable mix from higher margin licensing and DTC businesses.
Strategic priorities for FY16 to boost profitability
The company continues to concentrate on the successful execution of its growth and profitability plan to continue to strengthen its industry leadership, reach new consumers and drive continued growth.
The company's focused strategy includes, focusing on high performing, high growth brands and businesses. Since Fiscal 2014, the company has exited 30 brands, which accounted for approximately 90 million dollars in lower margin revenues, and refocused its portfolio toward core, high-margin brands. The company also converted smaller owned brands to licensed only brands.
The company also plans to enhance retail brand positioning in the menswear arena through the wholesale, retail and licensing of its core brands and expand international and licensing distribution through direct investment in the Western Hemisphere and Europe as well as strategic partnerships with licensees and other partners as well as expansion of the DTC channel.
Fiscal 2016 guidance
The company expects total fiscal 2016 revenues to be in a range of 910 dollars to 920 million dollars. Given the stronger performance in the third quarter, the company now expects adjusted earnings per diluted share in a range of 1.81 dollars to 1.88 dollars as compared to the previous guidance range of 1.78 dollars to 1.85 dollars.