Perry Ellis widens 2Q loss
Perry Ellis International widens 2Q loss on softer sales, weaker margins
MIAMI (AP) -- Perry Ellis losses widened beyond what Wall Street had expected during the second-quarter loss on weak sales in its direct-to-consumer business.
Revenue from its Rafaella women's sportswear and Perry Ellis menswear collections improved during the quarter, along with its Nike swim licensed products. But that was partially offset by a decrease in direct-to-consumer revenue, which includes online and catalog sales.
Perry Ellis said that its total revenue increased to $204.5 million from $203.1 million. But gross margin shrank to 32.4 percent from 33.1 percent due to a shift away from its higher-margin direct-to-consumer sales.
As a result, its net loss grew to $2.8 million, or 19 cents per share, for the quarter that ended Aug. 3. That's compared with a loss of $2.4 million, or 17 cents per share, last year. It had a loss of 15 cents per share on an adjusted basis versus a profit of 1 cent per share last year.
Analysts were anticipating a loss of 14 cents per share on revenue of $214.5 million, according to FactSet.
President and CEO Oscar Feldenkreis said that the progress in the Perry Ellis and Rafaella collection businesses is encouraging as the company moves into the second half of the year. He also said that inventory and assortments are well positioned moving into the fall.
Perry Ellis, based in Miami, stood by its forecast of earnings between $1.50 and $1.60 per share for the year on an adjusted basis. Analysts are anticipating $1.52 per share. But it lowered its revenue outlook on softer sales in some of its segments, saying it expected gains of 2 to 3 percent year-over-year, versus its prior forecast of 3 to 5 percent increases. Based on its total revenue last year of $980.6 million, this forecast implies full-year revenue of $1 billion to $1.01 billion. Analysts had forecast revenue of $1 billion for the year.
The clothier said that disciplined expense controls are expected to offset slightly lower revenue growth.
Shares of Perry Ellis International Inc. fell 24 cents to $19.22, a more than 1 percent decline amid a broader market uptick.
