Company Overview - G-III Apparel (NASDAQ: GIII) operates a diverse portfolio of over 30 owned and licensed brands, including DKNY, Donna Karan, Karl Lagerfeld, Calvin Klein, Tommy Hilfiger, Vilebrequin, Nautica, Halston, G.H. Bass, Levi's, and Champion [2]. Investment Strategy - The company focuses on identifying small, high-growth potential stocks with defensible competitive advantages and business models capable of generating significant operational leverage [1]. - The investment approach includes a buy and hold strategy with tranche purchases of stocks of interest, supported by a portfolio that incorporates buy alerts and market updates [3].

G-III Apparel Group, Ltd. (GIII) is successfully transforming its business by prioritizing owned brands, boosting profitability and brand control while reducing dependence on licensed labels. Strong growth from key brands like DKNY and Karl Lagerfeld, strategic digital investments and aggressive international expansion are positioning the company for sustainable, long-term success. Moreover, its focus on innovation, global reach and operational efficiency continues to drive strong momentum into fiscal 2026 ...

Financial Data and Key Metrics Changes - For fiscal year 2025, net sales increased by 2.7% to $3.18 billion, driven by over 20% growth in key owned brands [7][56] - Non-GAAP net income for the fourth quarter was $58 million or $1.27 per diluted share, compared to $36 million or $0.76 per diluted share in the previous year [55] - Full fiscal year 2025 non-GAAP net income was $204 million, up 9% from $190 million, with earnings per diluted share increasing to $4.42 from $4.04 [60][65] Business Line Data and Key Metrics Changes - The retail segment's net sales for the year were $166 million, up from $148 million, with strong double-digit comparable-store sales growth in DKNY and Karl Lagerfeld stores [57] - The wholesale segment's net sales increased to $3.08 billion, a 2.5% rise from $3.01 billion [56] - Donna Karan's relaunch was highly successful, with expectations of a 40% growth in the business going forward [97][110] Market Data and Key Metrics Changes - Calvin Klein and Tommy Hilfiger businesses collectively represented approximately 34% of total sales, down from over 50% two years ago, with expectations of further decline to about 25% by the end of fiscal 2026 [8] - DKNY achieved mid-teen growth, with approximately $675 million in reported net sales for fiscal 2025 [21][28] - Karl Lagerfeld saw over 20% growth, particularly strong in North America, which grew approximately 35% [29][34] Company Strategy and Development Direction - The company aims to drive growth of owned brands, which now represent just over half of total net sales, focusing on higher operating margins and licensing income [12][14] - Significant investments in marketing and technology are planned to enhance operational capabilities and support brand growth [11][46] - The partnership with All We Wear Group (AWWG) is expected to accelerate international growth, particularly in Spain and Portugal [10][63] Management's Comments on Operating Environment and Future Outlook - The management acknowledged a challenging operating environment but expressed confidence in navigating through it, expecting fiscal 2026 net sales of approximately $3.14 billion, a decrease of about 1% compared to 2025 [49][50] - Management highlighted the importance of adapting to market conditions, including tariff impacts and inventory management strategies [67][69] - The company anticipates continued growth in key owned brands, with a long-term goal of reaching over $5 billion in annual net sales [49][63] Other Important Information - The company ended the fiscal year with a solid inventory position, decreasing approximately 8% to $478 million [61] - A significant focus on enhancing omnichannel capabilities and digital sales is evident, with owned digital sites growing over 20% [46][44] - The company plans to invest approximately $50 million in capital expenditures for new brand launches and technology [71] Q&A Session Summary Question: Context on headwinds and impact of PVH licenses - Management indicated that the fall of Calvin Klein businesses was approximately $200 million, which was offset by growth in other areas [78] Question: Insights on Q4 outperformance and PVH revenue decline - Management clarified that Q4 performance was not due to unique shifts in wholesale shipments, and the decline in PVH revenues was anticipated [92][94] Question: Current size of the Donna Karan business - Management did not disclose specific figures but noted it was the best launch with anticipated growth approaching 40% [97][110] Question: Details on gross margin in Q4 - Management highlighted stronger margins from owned businesses and improved performance in outerwear [100] Question: Trends in wholesale orders and DTC development - Management reported similar order trends to the previous year and emphasized improvements in direct-to-consumer operations [114][116]