PVH Corp (PVH) plans to report its 4Q16 results on March 23. The company, which owns the famous Tommy Hilfiger and Calvin Klein brands, has recorded a YTD (year-to-date) sales increase of 3.2% on a YoY (year-over-year) basis.
PVH Corp, however, expects a 1% YoY contraction in its top line for 4Q16. This will likely be a result of a 2% revenue decline, attributable to the licensing of US womenswear wholesale business to G-III Apparel Group (GIII) and its Mexico deconsolidation.
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Calvin Klein’s revenue is projected to fall 5% YoY (-3% on a constant currency basis), while that of Heritage brands is expected to fall 3%. Tommy Hilfiger’s sales are likely to expand 3% (5% on a constant currency basis) during the fourth quarter, and its top line is projected to grow 1% YoY for the quarter, on a constant currency basis.
The company’s fiscal 2016 revenue is expected to rise ~2% YoY (3% on a constant currency basis), driven by a 6% growth in revenue from the Calvin Klein business (8% on a constant currency basis), and to see a 4% jump in sales from its Tommy Hilfiger business (5% on a constant currency basis). Its revenue from the Heritage Brands business, however, is projected to fall 9%, mainly due to the ongoing rationalization initiatives.
Notably, ETF investors seeking to add exposure to PVH can consider the iShares Morningstar Mid-Cap ETF (JKG), which invests 0.4% of its portfolio in PVH.
Amid a tough macroeconomic backdrop and ongoing headwinds, including retail bankruptcies in the apparel sector, PVH Corp has put up a good show. Companies like Ralph Lauren (RL) and VF Corp (VFC) have fumbled and missed analyst expectations on many occasions. RL reported a sales fall of 12% YoY in its most recent quarter, while VFC posted flat sales.
Continue to the next section for a closer look at the company’s margins and profitability.