(Reuters) – Apparel maker PVH Corp (PVH.N) reported a 38 percent rise in second-quarter profit on Wednesday and raised its earnings forecasts for the year, helped by higher sales of its Calvin Klein and Tommy Hilfiger brands.
FILE PHOTO: Boards with Calvin Klein store logo are seen on a shopping center at the outlet village Belaya Dacha outside Moscow, Russia, April 23, 2016. REUTERS/Grigory Dukor/File Photo
The company now expects earnings of $9.20 to $9.25 per share, compared with its previous forecast of $9.05 to $9.15 per share.
The New York-based apparel maker, like peers Tapestry Inc (TPR.N) and Ralph Lauren Corp (RL.N), has pulled heavily discounted products from department store shelves to regain its premium brand status.
“We are increasing our revenue and earnings guidance for the year, while continuing to take a prudent approach to planning our business in the second half of the year, as we experience increasing macroeconomic and geopolitical volatility around the world,” PVH Corp Chief Executive Emanuel Chirico said in a news release Wednesday.
Many U.S. retailers are bracing for the impact of tariffs imposed by the Trump administration on Chinese goods.
Chirico said about $400 million of its products are produced in China for the U.S. market.
“There might be an impact from tariffs, although it’s not that big a component for us,” he told CNBC.
PVH shares were down 1.6 percent in after-hours trading on Wednesday. The company’s shares are up roughly 13 percent year to date.
PVH has invested in improving online and offline consumer experiences by making transactions easier. In doing so, the company said it can better target shoppers, especially younger generations.
PVH said Calvin Klein’s sales rose 18 percent in the reported quarter, while Tommy Hilfiger reported sales growth of 15 percent.
Net income attributable to the company rose to $165.2 million, or $2.12 per share, in the three months ended Aug. 5, from $119.7 million, or $1.52 per share, a year earlier.
Excluding items, PVH earned $2.18 per share, 8 cents more than the average analyst estimate of $2.10, polled by Thomson Reuters I/B/E/S.
Net sales rose 13.2 percent to $2.22 billion.
Reporting by Melissa Fares in New York; Additional reporting by Ankit Ajmera in Bengaluru; Editing by Sriraj Kalluvila and Lisa Shumaker