Fourth Quarter Results Phillips-Van Heusen Corporation reported fourth quarter 2006 net income of $26.8 million, or $0.47 per share, which was $0.04 ahead of its previous earnings guidance.
Fourth quarter 2006 earnings per share was up 31% when compared with fourth quarter 2005 non-GAAP earnings per share of $0.36. Fourth quarter 2005 GAAP net income was $22.9 million, or $0.41 per share.
The increase in fourth quarter earnings per share was driven by revenue increases registered by all of the Company's operating divisions and a 190 basis point improvement in gross margin.
The improvement in gross margin was driven by significant growth in royalties, which have a gross margin rate of 100%, combined with sales growth in the Company's higher margin Calvin Klein men's better sportswear and outlet retail divisions.
Partially offsetting this increase was a planned increase in advertising expenses of approximately $29.0 million in the fourth quarter, attributable to the Calvin Klein, IZOD, Van Heusen and Arrow brands.
Annual Results:
For the full year, 2006 GAAP net income was $155.2 million, or $2.64 per share compared with $111.7 million, or $1.85 per share in 2005. For the full year 2006, non-GAAP earnings per share increased 39% to $2.62 from $1.88 in 2005.
Revenues:
Total revenues in the fourth quarter of 2006 increased 21% to $557.0 million from $460.1 million in the prior year. Revenue growth was driven by a 32% increase in Calvin Klein royalties attributable to continued growth from existing and new licensees, with particular strength coming from the licensed fragrance business as a result of the success of women's Euphoria coupled with the recent launch of men's Euphoria. The Company's outlet retail business continued its positive momentum by achieving comp store sales growth of 8% for the quarter.
marketing@alchempro.com
