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Wolverine Worldwide provides outlook for FY18

Wolverine World Wide, Inc. has provided an outlook for fiscal year 2018 including its investment plan to drive its new global growth agenda. Announcing preliminary financial results for the fiscal year ended December 30, 2017, the company said revenues were 2.35 billion dollars, at the top end of its full-year outlook and the company expects fiscal 2017 adjusted diluted earnings per share at the high end of its previous earnings outlook of 1.60 dollars to 1.65 dollars and diluted earnings per share in the range of loss of 0.04 dollar to earnings of 0.01 dollar.

"The Company has been keenly focused on operational excellence, improving our brand platforms, and portfolio management over the past two years," said Blake W. Krueger, Wolverine Worldwide's Chairman, Chief Executive Officer and President in a press release, adding, "We are in the last innings of completing our work, and we expect this important effort will allow us to achieve our operating margin target ahead of schedule while creating the financial capacity to invest in key growth initiatives."

Wolverine Worldwide reveals outlook for FY18

Building off of its strong performance in 2017, and the ongoing benefits expected from the Wolverine Way Forward transformation, the company expects to deliver mid-single-digit underlying revenue growth in 2018, achieve its 12 percent adjusted operating margin target even with significant incremental investments to drive future growth, and recognize meaningful benefits from recent US corporate tax reform.

For the fiscal 2018, Wolverine expects revenue in the range of 2.24 billion dollars to 2.32 billion dollars, a reported decline of 1.3 percent and underlying growth of nearly 6 percent at the high-end of the range, incremental investments of 40 million dollars to 45 million dollars to fuel growth, reported operating margin of 11.6 percent, adjusted operating margin of 12 percent, inclusive of the incremental investment spend, reported diluted earnings per share in the range of 1.87 dollars to 1.97 dollars and adjusted diluted earnings per share in the range of 1.95 dollars to 2.05 dollars.

The company expects to deliver its 2018 underlying revenue outlook through ecommerce growth of at least 20 percent, high-single-digit growth in its international business, and low-single-digit growth in its US wholesale business. During 2018, the Company will execute on its Global Growth Agenda, which includes 40 million dollars to 45 million dollars of incremental investments.

Picture:Facebook/Wolverine

Myer issues profit warning on subdued stocktake sale

Total sales in the first half of 2018 were down 3.6 percent to 1,719.6 million Australian dollars (1,337.9 million dollars), down 3 percent on a comparable store sales basis. Online sales in 1H 2018 were up 48.9 percent, following a 48.4 percent increase in 1H 2017. As a result of the further deterioration in trading, Myer anticipates 1H 2018 NPAT to be between 37 million Australian dollars (28.7 million dollars) and 41 million Australian dollars (31.8 million dollars) pre implementation costs and individually significant items. The company does not anticipate an improvement in retail trading conditions during the second half and said, given the recent sales volatility, Myer cannot provide a specific profit range for the full year 2018 NPAT at this time. .

Commenting on the first half trading, Myer Chief Executive Officer Richard Umbers said in a statement: “The significant deterioration in trading reflects ongoing challenging retail conditions with widespread industry discounting, a subdued performance of Myer’s stocktake sale and a continued shift in consumer behaviour characterised by reduced foot traffic and an increase in online shopping. I am in no doubt that our heightened focus areas including online and productivity are correct for this low growth environment as evidenced by the strong growth in online sales in the first half.”

On 14 December 2017, Myer Holdings Limited announced a second quarter trading update reporting a deterioration in trading during the start of the second quarter following a subdued performance during the first quarter. Total sales to the end of November, the company said, were down 2.3 percent and comparable store sales were down 1.8 percent, compared to the previous corresponding period. Total sales during the first two weeks in December deteriorated and were down 5 percent on the previous corresponding period. Total sales during January were down 6.5 percent on the previous corresponding period.

“I recognise that shareholders will be disappointed with today’s announcement. I am continuing my Chairman’s review of all aspects of the business including Myer one, omni-channel, merchandise, marketing, customer service, property and a thorough cost review. The focus on costs is ongoing and was evidenced by the announcement on 18 January in which we announced a number of redundancies and the exit of a further floor at the support office, which will deliver annualised cost savings of over 7 million Australian dollars,” added Myer Chairman Garry Hounsell

Picture:Facebook/Myer

Urban Outfitters Q4 net sales up 5.7 percent

Urban Outfitters net sales for the fourth quarter of fiscal 2018 increased 5.7 percent over the same period last year to 1.09 billion dollars. The company said, comparable retail segment net sales increased 4 percent, driven by strong, double-digit growth in the direct-to-consumer channel, partially offset by negative retail store sales. For the year ended January 31, 2018, net sales increased to 3.6 billion dollars or 2 percent over the prior year, while comparable Retail segment net sales were flat.

“I’m pleased to report record revenues and a 4 percent increase in retail segment comparable sales for our fourth quarter,” said Richard A. Hayne, the company’s Chief Executive Officer in a media statement, adding, “Positive ‘comps’ were driven primarily by stronger apparel sales with January registering particularly powerful year-over-year results.”

By brand, comparable Retail segment net sales increased 8 percent at Free People, 5 percent at the Anthropologie Group and 2 percent at Urban Outfitters. Wholesale segment net sales increased 6.3 percent. Wholesale segment net sales for the full year increased 9.5 percent.

During the year under review, the company opened a total of 18 new locations including: eight Free People stores, five Urban Outfitters stores, four Anthropologie Group stores and one food and beverage restaurant; and closed 11 locations including three Free People stores, two Urban Outfitters stores, three Anthropologie Group stores and three food and beverage restaurants.

Picture:Free People website

The publicly traded company’s same-store sales rose 6.3 percent during the month of January. Zumiez’s (NASDAQ:ZUMZ) shares rose by 0.1 percent in the first day of trading following the news.

The fashion retailer last posted its earnings results on November 30th, 2017, when it recorded 0.48 dollars earnings per share for the quarter, hitting analysts’ consensus estimates of 0.48 dollars apiece. According to Zacks, Zumiez had a return on equity of 7.99 percent and a net margin of 2.84 percent.

The firm had revenue of 245.80 million dollars for the quarter, surpassing consensus estimate of 244.50 million dollars.

Recently, analysts at B. Riley set a 23 dollars price target on Zumiez and gave the company a “buy” rating in a research report. Earlier this year Jefferies Group set a slightly lower price target – 22 dollars apiece - on Zumiez, recommending investors to hold on the stock. William Blair also set the same price target on the company’s shares, although rating the stock as a “buy”. The company presently has an average rating of “Hold” and an average target price of 20.57 dollars.

Several hedge funds have recently bought and sold shares of the business. Ameriprise Financial Inc. grew its holdings in shares of Zumiez by 1.3 percent during the second quarter to a total 91,853 shares of the apparel and footwear maker’s stock worth 1,135,000 dollars after acquiring an additional 1,135 shares during the period.

Disciplined Growth Investors Inc. MN enlarged their stake in Zumiez by 0.6 percent during the same period, reaching 259,975 shares’ worth 3,211,000 dollars. New York State Common Retirement Fund, The Manufacturers Life Insurance Company, and Teachers Advisors LLC also grew their respective holdings in shares of Zumiez over the second quarter.

HanesBrands FY17 net sales increase 7 percent

HanesBrands reported full-year net sales growth of 7 percent to 6.47 billion dollars and fourth-quarter net sales increase of 4 percent to 1.645 billion dollars. Organic sales, the company said, increased 2 percent in constant currency in the fourth quarter. Hanes however reported net loss of 384.6 million dollars for the fourth quarter while for the full year net income reduced to 61.8 million dollars.

“2017 was a successful year during which we focused on diversifying our business to be able to consistently deliver annual topline growth,” said Hanes Chief Executive Officer Gerald W. Evans Jr. in a media release, adding, “We have additional work to do, including addressing inflationary and short-term cost pressures, but our brands are strong, our key market shares are increasing, our international businesses are sizable and growing, and we are driving significant direct-to-consumer growth worldwide. We expect another strong year of operating cash flow in 2018.”

Important highlights of the fourth quarter and year under review

On a GAAP basis, which includes the effect of the tax charge related to US federal income tax reform, the company reported a fourth-quarter loss per diluted share of 1.06 dollars, and full-year EPS was 0.17 dollar. GAAP operating profit for the full year decreased 7 percent to 723 million dollars and fourth-quarter operating profit of 120 million dollars decreased 41 percent.

Innerwear segment sales increased 1 percent in the fourth quarter, driven by strong men’s and children’s underwear growth. For the full year, segment sales decreased 3 percent. Online channel sales increased 12 percent. Operating profit decreased 6 percent in the fourth quarter and for the full year.

Activewear segment sales increased 9 percent in the fourth quarter and 3 percent for the full year. Fourth-quarter organic sales increased 4 percent, while the acquisition of Alternative Apparel in October 2017 contributed 18 million dollars in sales. Core Champion performance, including strong sales of the Champion Life line of products and reverse-weave fleece, and higher sports apparel sales drove quarter growth. Online channel sales for the segment increased 27 percent in the quarter. Segment operating profit increased 2 percent in the fourth quarter and 1 percent for the full year.

International segment net sales up 8 percent in the fourth quarter and 34 percent for the full year. Organic sales in constant currency increased 3 percent in the quarter and 5 percent for the year. Space gains, including new store openings, and strong consumer demand at retail and online, the company added, drove activewear and innerwear strength across all geographies – the Americas, Asia, Europe and Australia. Operating profit increased 8 percent in the fourth quarter, and acquisitions contributed to 45 percent growth for the full year.

HanesBrands announces acquisition of Bras N Things

Hanes also announced that the company has entered into a definitive agreement to acquire Bras N Things, a leading specialty retailer and online seller of intimate apparel in Australia, New Zealand and South Africa. In 2017, Bras N Things had net sales of approximately 180 million Australian dollars (144 million dollars). The company said, all-cash transaction is valued at 500 million Australian dollars (approximately 400 million dollars) on an enterprise-value basis.

“Bras N Things is a leading intimate apparel retailer and ecommerce business that is a strategic and natural complement to our very successful Bonds underwear business in Australia and New Zealand,” Evans further said, adding “This consumer-direct sales model has significant potential for expansion into other geographic markets. We are delighted that Bras N Things CEO George Wahby, who oversees a talented management team, will remain with our Hanes Australasia business unit.”

Bras N Things, based in Sydney, sells proprietary bras, panties and lingerie sets through a retail network of approximately 170 stores and ecommerce platform. The company’s three-year compound annual growth rate is 11 percent, and online sales last year increased 71 percent and represent nearly 10 percent of total sales. The company operates 154 stores in Australia, 10 stores in New Zealand and 7 stores in South Africa.

Hanes issues initial guidance for FY18

For 2018, Hanes expects net sales of 6.72 billion dollars to 6.82 billion dollars, GAAP operating profit of 870 million dollars to 905 million dollars, adjusted operating profit excluding actions of 950 million dollars to 985 million dollars, GAAP EPS of 1.54 dollars to 1.62 dollars, adjusted EPS excluding actions of 1.72 dollars to 1.80 dollars, and net cash from operations of 675 million dollars to 750 million dollars.

Key assumptions in the company’s guidance include, Hanes said: a cautious outlook for the US brick-and-mortar consumer environment, including the first-half effect of door closures; an increase in full-year organic sales driven by online, global Champion, and international growth; and higher commodity costs and increased marketing investment to support additional planned product innovation. At the midpoint of 2018 guidance, net sales are expected to increase approximately 5 percent compared with 2017.

On a pro forma basis, applying an income tax rate of approximately 16 percent to 2017 results, consistent with the effect of tax reform, the company expects GAAP EPS would have been 1.05 dollars higher and adjusted EPS would have been 0.25 dollar lower. At the midpoint of 2018 guidance, GAAP EPS would increase 30 percent compared with pro forma 2017 results, and adjusted EPS would increase 5 percent on a pro forma comparison basis.

For the first quarter net sales are expected to be in the range of 1.42 billion dollars to 1.44 billion dollars. GAAP EPS is expected to be 0.17 dollar to 0.20 dollar, and adjusted EPS is expected to be 0.23 dollar to 0.25 dollar. In constant currency, organic growth is expected to decrease less than 1 percent in the quarter, reflecting the effect of retailer door closures in the United States and expectations of ongoing tight inventory management by retailers.

Picture:HanesBrands website

January comparable store sales up 7 percent at L Brands

L Brands, Inc. has reported net sales of 1.040 billion dollars for the five-week period ended February 3, 2018, compared to 805.2 million dollars for the four-week period ended January 28, 2017. The fifth week in January represented approximately 150 million dollars in sales and 0.07 dollar in earnings per share. The company’s comparable sales increased 7 percent for the period under review.

Net sales were 4.823 billion dollars for the fourth quarter compared to 4.489 billion dollars for the 13 weeks ended January 28, 2017. Comparable sales for quarter increased 2 percent compared to the 1same period last year. Net sales were 12.632 billion dollars for the 53-week year ended February 3, 2018, compared to 12.574 billion dollars for the 52 weeks ended January 28, 2017. Comparable sales for the 53 weeks decreased 3 percent compared to the last year. For the 53 weeks, the exit of the swim and apparel categories had a negative impact of about 3 percentage points and 5 percentage points to total company and Victoria’s Secret comparable sales, respectively.

Before the effect of any significant items, including the impact of tax reform legislation, the company expects to report fourth quarter earnings per share of about 2.05 dollars, compared to its previous guidance of about 2 dollars.

Picture:L Brands website

Cato sees deeper Q4 loss, January same-store sales drop 6 percent

The Cato Corporation reported 19 percent increase in sales for the five weeks ended February 3, 2018 to 54.2 million dollars over 45.5 million dollars for the four week period ended January 28, 2017. On a comparable five-week basis, total sales decreased 7 percent and same-store sales for the month decreased 6 percent.

"The January same store sales decline is consistent with our recent trend," stated John Cato, the company’s Chairman, President, and CEO in a statement, adding, "We now expect the fourth quarter earnings to be a loss of between 0.55 dollar and 0.65 dollar versus a loss of 0.48 dollar last year. The company's estimate for full year earnings per diluted share is in the range of 0.30 dollar to 0.40 dollar versus 1.72 dollars last year."

The company said, sales for fourth quarter ended February 3, 2018 were 211.1 million dollars, a decrease of 3 percent over sales of 218.2 million dollars for the same quarter last year. On a comparable 14-week basis, total sales for the quarter decreased 8 percent and comparable store sales decreased 8 percent on last year. For the full year, sales decreased 11 percent to 842.1 million dollars from 2017 sales of 947.4 million dollars. On a comparable 53-week basis, total sales for the fiscal year ended February 3, 2018 decreased 12 percent and comparable store sales decreased 12 percent from last year.

During January, the company closed four stores and closed nineteen stores during the fourth quarter. In the fiscal year ended February 3, 2018, the company opened six stores, relocated three stores and closed twenty six stores. As of February 3, 2018, Cato Style operated 1,351 stores in 33 states, compared to 1,371 stores in 33 states as of January 28, 2017.

Picture:Facebook/Cato Styles

Replay owner Style Box's turnover increases to 230 mn euros

The Style Box group owner of the Italian denim label Replay, reported a considerable revenues growth in fiscal 2017 over the previous year, reports Modaes.es. The company’s turnover for the year reached 230 million euros (281.5 million dollars) compared to 203 million euros (248.4 million dollars) in 2016, while EBITDA was 18 million euros (22 million dollars).

This year, the company targets to achieve a turnover of 245 million euros (299.8 million dollars). By region, north Europe is the leading market for the company, followed by Japan and Latin America. The company said, revenue increase was driven by its international business, which already contributes 85 percent to the total turnover.

Last year, Replay expanded its retail presence in a number of Latin American countries and added stores in Colombia, Paraguay and Brazil. The Style Box group operates 14 standalone stores in Japan and opened its first store in the Ukraine in 2017 along with three new stores in Brazil. Now the company plans to open fourth Brazil store and a store in Macedonia this year.

Picture:Facebook/Replay

Luxury goods maker Hermes said Thursday it shrugged off economic, geo-political and monetary uncertainty to book record sales in 2017, thanks to the strong performance of all of its divisions across all regions.

Hermes' said in a statement that revenues grew by 6.7 percent to 5.6 billion euros ($6.9 billion) last year. The group said that growth was driven by "well-balanced contributions across the business lines and all geographical areas" and the development was "particularly healthy as it is mainly based on an increase in volumes." "2017 was a very good year," said chief executive Axel Dumas. "We accelerated growth, which is once again faster than the sector average."

Hermes had demonstrated its "solidity year after year," despite the "very unstable and volatile" environment, he said. The group's biggest division, leathergoods and saddlery, lifted sales by 7.6 percent to 2.8 billion euros, with CEO Dumas pointing to "very strong demand for our bags." Hermes is scheduled to publish full details of its 2017 results on March 21. (AFP)

Levi Strauss posts 8 percent revenue growth in FY17

Net revenues at Levi Strauss & Co grew 13 percent on a reported basis and 11 percent excluding favourable 22 million dollars favourable currency translation to 1,466 million dollars in the fourth quarter ended November 27, 2017. For the full year, reported revenue grew 8 percent and 7 percent in constant currency, excluding 11 million dollars in favourable currency translation to 4,904 million dollars. Fourth quarter net income of 116 million dollars grew 20 percent, while full-year net income declined 3 percent due to a 23 million dollars loss.

"Our growth and momentum accelerated in Q4 capping the strongest revenue year the company has had in more than a decade," said Chip Bergh, the company’s President and CEO in a press release, adding, "Our strategies are working and the investments that we’ve made to diversify our business over the past few years are paying off, best demonstrated by the strength of the Levi’s brand globally."

Highlights of Q4 and FY17 performance

On a reported basis, gross margin for the fourth quarter was 53.4 percent of revenues compared with 50.7 percent in the same quarter of fiscal 2016, reflecting the margin benefit from revenue growth in the direct-to-consumer channel and international business. Operating income of 150 million dollars in the quarter was up from 143 million dollars in the same quarter of 2016, primarily reflecting higher gross profit, partially offset by higher SG&A.

In the Americas, net revenues grew 7 percent on a reported and constant currency basis in the fourth quarter, reflecting higher revenues across both wholesale and direct-to-consumer channels in the US, Canada and Mexico. In Europe, excluding favourable currency effects of 18 million dollars, net revenues grew 21 percent. In Asia, net revenues grew 13 percent on a reported and constant currency basis, reflecting direct-to-consumer expansion and performance.

On a reported basis, gross margin for the fiscal year was 52.3 percent compared with 51.2 percent in fiscal 2016, reflecting strong growth in international and retail revenues, favourable transaction impact of currency and sourcing savings. Operating income of 467 million dollars for the fiscal year was up from 462 million dollars in 2016.

In the Americas, full year net revenues grew 3 percent on a reported and constant currency basis, primarily reflecting the performance and expansion of our company-operated retail network and strong performance in Signature and Denizen brands offset by lower wholesale revenues in the United States in Dockers brand. In Europe, excluding favourable currency effects of 13 million dollars, net revenues grew 19 percent reflecting broad-based growth across all markets and channels. In Asia, excluding unfavourable currency effects of 2 million dollars, net revenues grew 5 percent, reflecting direct-to-consumer expansion and performance.

Picture:Facebook/Denizen