Non GAAP earnings per share at US apparel marketer PVH Corp which has brands like Tommy Hilfiger and Calvin Klein in its portfolio rose 11 per cent year over year for the second fiscal quarter ended August 2, 2015. Earnings per share on a non-GAAP basis excluding the negative impact primarily related to foreign currency exchange rates was $1.68, or an increase of 11 per cent from a fiscal ago period. “However, when considering the negative impact of $0.31 related to foreign currency exchange rates, earnings per share on a non-GAAP basis were $1.37,” a PVH press release said. GAAP earnings per share for the reporting quarter were $1.22 as compared to $1.52 for the prior fiscal’s second quarter. Revenue inched up much slower at 2 per cent on a constant currency basis, but fell 6 per cent on a GAAP basis, when comparing to the previous fiscal’s same quarter revenue of $1.98 billion. As against last fiscal’s second quarter, revenues drove up 5 per cent in the Tommy Hilfiger business on a constant currency basis, but dropped 7 per cent on a GAAP basis. Similarly, sales went up 3 per cent in the Calvin Klein business on a constant currency basis, however, dipped 4 per cent on a GAAP basis in the quarter under review. Net interest expense in the second quarter of fiscal 2016 declined to $28 million from $34 million in the same quarter of earlier fiscal, due, principally to lower average debt balances. “The effective tax rate on a non-GAAP basis descended 21.5 per cent versus 26.9 per cent in the second quarter of fiscal 2015, due to certain favourable discrete items in the current quarter,” PVH added. The effective tax rate on a GAAP basis increased to an expense of 19.0 per cent compared to a benefit of 0.8 per cent in the fiscal ago quarter. “This happened as the prior year effective tax rate included a discrete benefit of approximately $30 million related to the favourable resolution of uncertain tax positions,” the apparel marketer explained. CEO Emanuel Chirico stated, “Our second quarter performance highlighted continued strength in our Calvin Klein business, as consumers responded well to our recent product initiatives, particularly in underwear.” “Overall, our first half earnings per share, which increased 16 per cent on a non-GAAP and constant currency basis, demonstrated our ability to deliver against our 2015 plan,” Chirico too added. For the second half of the fiscal, PVH expects to generate earnings per share growth on a non-GAAP and constant currency basis of between 12 and 14 per cent, up from its previous guidance of 11-12 per cent. The company believes that the strength of the US dollar and the changing consumer spending patterns of global tourists in the US, along with volatility in the global environment, will remain a headwind.
