Perry Ellis revenues meet expectations, reaffirms fiscal year guidance
Perry Ellis on Thursday reported a decrease in revenues that fell in line with its expectations. CEO Oscar Feldenkreis was pleased with the company’s results and said that the company is “continuing our positive momentum from the first half of the year.”
The Perry Ellis namesake brand, Golf Lifestyle brand and Nike swim brands achieved gross margin expansion, which led to an increase in adjusted diluted earnings per share.
Feldenkreis added, “We attribute our consistent positive performance to the intense focus on what we do best — bringing relevant, innovative product to the marketplace, intensifying our relationships with consumers and driving operational excellence across all areas of our business. We ended the quarter with extremely clean inventory levels and brands and businesses well positioned for the final quarter of the year."
Perry Ellis has benefitted from its focus on its core brands. Since 2014, the company has exited over 30 brands, which accounted for $100 million in lower margin revenues. Strategic partnerships and licenses led to 6% revenue growth in the third quarter, and the international business represented 13.7% in total revenues compared to 12.5% in the prior year comparable period.
Also in the third quarter, Perry Ellis entered new license agreements with Doctorstick Korea for its namesake brand and Sheralven Enterprises for Laundry by Shelli Segal. In August, the company announced plans to close 15 stores and shift its focus to e-commerce and retail.
Total revenue fell to $194 million from $205.4 million and revenues on a constant currency basis were $197.2 million. Gross margin improved 100 basis points over the third quarter of fiscal 2016, and SG&A expenses were $72.8 million compared to $64.9 million.
Net loss was $5.2 million, or $0.34 per share, compared to net income of $2.3 million, or $0.15 per diluted share, and adjusted EPS was $0.23 versus $0.16 in the previous year. Adjusted EBITDA was $6.9 million compared to $8.8 million in the prior year.
Perry Ellis reaffirmed its fiscal 2017 guidance and expects revenues to range from $885 million to $890 million and adjusted EPS to range from $1.95 to $2.00. Feldenkreis added that the company believes that consumer confidence will increase now that the election is over despite its results.
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