Covid Will No Longer Get Between You and Your Calvin Kleins

© Reuters.

By Christiana Sciaudone — The owner of Calvin Klein and Tommy Hilfiger rose 5% with a largely rosy outlook for 2021.

PVH Corp (NYSE:). said it expects international businesses to exceed 2019 pre-pandemic revenue levels in the first half of the year as it cuts its global workforce and real estate footprint, which should result in an improvement for gross margins.

The company missed sales and profit estimates for the fourth quarter as lockdowns were extended and the need to look smart and sharp fell out the window. Revenue of $2.09 billion was 20% lower than a year earlier, and below the analyst consensus of $2.12 billion. A loss per share of 38 cents was worse than the expected loss of 32 cents.

But with vaccinations increasing and post-pandemic plans being made, the company sees a much brighter future. It’s also planning to be more aggressive in reducing promotional selling to help support margins. The company will close more stores and offices in addition to a previously announced 12% reduction in its North America office workforce.

“We remain focused on connecting our core strengths to where the consumer is going – with our biggest brands Calvin Klein and TOMMY HILFIGER, in how we are super charging e-commerce, through our casual assortments, and how we are taking market share in our international businesses,” said Chief Executive Officer Stefan Larsson in a statement. “As we look forward, we will increasingly continue to shift our business globally towards these channels and categories. In addition, we executed disciplined expense management, significantly improved our inventory position, and ended the year with over $3 billion in liquidity.”

Current European lockdowns and a slow return to international tourism will keep sales lower until the end of the year, but revenue should increase as much as 24% compared to 2020. 

PVH projects that 2021 earnings per share will be approximately $6 compared to a loss per share of $1.97 in 2020. For the first quarter, revenue should increase up to 44% compared to the prior year period and profit should range from 80 cents to 83 cents compared to a loss of $3.03 per share a year earlier.



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