Tommy Hilfiger and Calvin Klein Have Another Outstanding Quarter


Apr. 3 2018, Updated 7:31 a.m. ET

Evaluating Tommy Hilfiger’s performance

Tommy Hilfiger accounted for 46% of PVH’s (PVH) 4Q17 top line, recorded a stellar 22% YoY (year-over-year) growth in sales to $1.1 billion. This robust growth was mainly driven by the company’s international business, which grew 37% YoY to $702 million. Currency also boosted its performance, as overseas sales were up 24% on a currency-neutral basis. Growth came in through all geographies and channels, and comps grew 6% in international markets.

In North America, sales rose 5% YoY, driven by an impressive 10% growth in comps. Partially offsetting this improvement was a planned decline in wholesale off-price distribution. In fiscal 2017, Hilfiger brand sales rose 11% YoY.

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Evaluating Calvin Klein’s performance

Calvin Klein accounted for 39% of PVH’s 4Q17 sales. The business grew an impressive 23% YoY during the quarter, driven by strong international and domestic sales. “In particular over the last few months, the momentum around the CK brand has intensified with its cultural relevancy resonating and consumer interest in conversion to purchase seeing nice improvements,” said PVH chairman and CEO Emanuel Chirico during company’s 4Q17 conference call.

International business grew 33% YoY (23% on a constant-currency basis) to $512 million, with comps rising 4%. Europe and Asia, in particular, performed outstandingly.

Calvin Klein’s North America sales returned to growth after four weak quarters. Sales improved 13%, fueled by strong wholesale and retail sales, and retail comps rose 4%. In fiscal 2017, Calvin Klein sales rose 10% YoY. Investors seeking exposure to PVH could consider the iShares Morningstar Mid-Cap Value ETF (JKI), which invests 0.65% of its portfolio in PVH.


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