G-III Apparel (GIII) Q1 Earnings Beat Estimates, Sales Rise Y/Y

Core Viewpoint - G-III Apparel Group, Ltd. reported first-quarter fiscal 2025 earnings that exceeded expectations but showed a year-over-year decline, with sales missing consensus estimates yet improving compared to the previous year [1][3][12]. Financial Performance - Adjusted earnings were 12 cents per share, surpassing the Zacks Consensus Estimate of a loss of 5 cents, but down from 13 cents in the same quarter last year [3]. - Net sales for the wholesale segment reached $598 million, up from $587 million year-over-year, while the retail segment saw net sales of $31 million, an increase from $30 million despite nine store closures [4]. - Total net sales increased by 0.5% year-over-year to $609.7 million, falling short of the consensus estimate of $615 million [12]. - Gross profit rose by 3.6% year-over-year to $258.9 million, with gross margin expanding by 130 basis points to 42.5% [13]. Expenses and Profitability - SG&A expenses increased by 3.8% year-over-year to $236.6 million, representing 38.8% of net sales, an increase of 120 basis points [5]. - Operating profit for the fiscal first quarter was $13.5 million, down from $15.3 million in the prior year [5]. Future Outlook - The company anticipates adjusted net income between $170 million and $175 million, with adjusted earnings projected between $3.58 and $3.68 per share, compared to $189.8 million and $4.04 per share in fiscal 2024 [7]. - For the full fiscal year 2025, G-III expects net sales of approximately $3.2 billion, reflecting a growth of about 3% from the previous year, driven by its own brands and new initiatives [15]. - For the fiscal second quarter, net sales are expected to be around $650 million, down from $659.8 million in the prior year, with adjusted net income projected between $10 million and $15 million [19]. Strategic Initiatives - The company is focusing on leveraging design and merchandising strengths to drive profitable sales growth through innovative products and collections, expanding its European presence, enhancing omnichannel capabilities, and investing in marketing to boost global brand awareness [11]. - G-III aims to reduce reliance on PVH brands and expand in fast-growing markets like India and China [11]. Financial Position - At the end of the fiscal first quarter, the company had net cash of $80 million and over $1 billion in liquidity [14]. - Cash and cash equivalents stood at $508.4 million, with total debt of $426.4 million and total stockholders' equity of $1.52 billion [18]. - Inventory decreased by 23.9% year-over-year to $479.7 million [18].