Buy Brand DKNY Reborn G-III Annual Revenue Exceeded $3 Billion

After releasing a number of record year-round data, G-III Apparel Group Ltd. (NASDAQ:GIII), owned or represented by DKNY, Calvin Klein, Tommy Hilfiger and other classic American fashion brands, rose 11.12% on Thursday to close at $39.07.

Group Chairman and chief executive officer Morris Goldfarb said sales last year exceeded $3 billion for the first time, while DKNY, Donna Karan, Calvin Klein, Tommy Hilfiger and Karl Lagerfeld also promoted the group's profit record at the same time. The 2019 fiscal year was also the year of group pformation, because the two major brands of the DKNY group were operated for the first time by the group.

As of the four quarter of January 31st, G-III recorded a net profit of 24 million 80 thousand US dollars or earnings per share of $0.48, a loss of 542 thousand US dollars in the same period in 2018 or -0.01 US dollars per share, adjusted 0.55 EPS, far exceeding the 0.44 US dollars expected, more than doubled in the 2018 fiscal year 0.26 dollars.

During the period, sales increased by 7.3% to 766 million 800 thousand US dollars, slightly lower than the market forecast of US $768 million 200 thousand, compared with us $714 million 900 thousand in 2018 and DKNY and Tommy Hilfiger as the main driving force.

During the reporting period, retail sales fell by 13% to 155 million dollars, of which Wilsons sales fell 9%, G.H. Bass sales fell 2.6%, while DKNY with store sales rose 10%, and retail sales declined partly by the reduction of stores.

Wholesale business revenue rose by 13% to 699 million dollars during the period.

Fourth quarter group gross margin recorded a 33.8% annual plunge of 240 basis points, mainly due to wholesale gross profit margin fell 90 basis points to 28.7%, retail gross margin fell 260 basis points to 48.9%.

The Group expects to earn $650 million in the first quarter of the current fiscal year, net profit of US $700-1200, or earnings per share of US $0.13-0.23. After adjustment, EPS expects us $0.15-0.25.

In the 2019 fiscal year ended January 31st, G-III Apparel Group Ltd. recorded a revenue of US $3 billion 76 million 200 thousand, an increase of 9.6% over the 2 billion 806 million 900 thousand US dollars in the 2018 fiscal year. During the same period, the same store sales jumped 17%, which failed to offset the same store sales decline of G.H. Bass and Wilsons for the whole year 3.7% and 1.6%, resulting in a decline of 5% to 466 million dollars in the annual sales of retail channels.

Wholesale channel continued strong, sales increased 11% to 2 billion 720 million U.S. dollars last year, during the period Bon-Ton Stores department store bankruptcy caused a certain negative impact on the business, especially Calvin Klein sales.

In 2019, the gross profit margin of the group dropped by 160 basis points to 36%, of which wholesale business gross margin 32.4% fell by 40 basis points on a yearly basis, and gross retail interest rate fell by 220 basis points to 47.7%.

Annual net profit of $138 million 100 thousand or earnings per share of $2.75, the same period in 2018 was $62 million 124 thousand or earnings per share of $1.25, adjusted EPS increased from $1.60 to 2.86 US dollars, up 75%.

G-III Apparel Group Ltd. expects sales in fiscal year 2020 to be US $3 billion 280 million, net profit of US $1.62-1.67 billion, or EPS 3.18-3.28 US dollars. After adjustment, EPS expects us $3.25-3.35.