G-III earnings miss FY26 targets as sales decline and outlook weakens

Core Insights - The company's net sales for the year ended 31 January 2026 decreased by 7.0% to $2.96 billion, falling short of the anticipated $2.98 billion [1] - Net income dropped to $67.4 million, translating to $1.51 per diluted share, compared to $193.6 million or $4.20 per diluted share in the previous year [1] Financial Performance - The fiscal year included $46.1 million in non-cash asset impairment charges, equating to $1.04 per diluted share, and a bad debt expense of $17.5 million primarily due to the bankruptcy of Saks Global, which accounted for $0.30 per diluted share after tax [2] - In the fourth quarter, net sales fell by 8.1% to $771.5 million from $839.5 million a year earlier, resulting in a net loss of $31.9 million [3] - The company ended the fiscal year with cash and cash equivalents of $406.7 million, an increase from $181.4 million the previous year, while inventories decreased by 3.8% to $460 million [3] Strategic Outlook - The company anticipates net sales for fiscal 2027 to be approximately $2.71 billion, reflecting a loss of $470 million in sales from Calvin Klein and Tommy Hilfiger products [5] - Forecasted net income for fiscal 2027 is expected to range between $88 million and $92 million, with diluted earnings per share projected between $2.00 and $2.10 [6] - For the first quarter of fiscal 2027, net sales are projected to be about $530 million, down from $583.6 million in the previous year, with an anticipated net loss between $18 million and $13 million [6] - The company aims to build on the momentum of its go-forward portfolio, expecting high-single digit growth for the year while focusing on gross margin expansion and cost structure streamlining [7]