UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 5, 2024
G-III APPAREL GROUP, LTD.
(Exact Name of Registrant as Specified in its Charter)
Delaware |
0-18183 |
41-1590959 |
|
512 Seventh Avenue New York, New York |
10018 |
(212) 403-0500
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
Common Stock, $0.01 par value per share |
GIII |
The Nasdaq Stock Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On September 5, 2024, G-III Apparel Group, Ltd. (the “Company”) announced its results of operations for the second fiscal quarter ended July 31, 2024. A copy of the press release issued by the Company relating thereto is furnished herewith as Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits.
None.
None.
None.
99.1 |
104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document). |
Limitation on Incorporation by Reference
In accordance with General Instruction B.2 of Form 8-K, the information reported under Item 2.02 and in Exhibit 99.1 shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, is not subject to the liabilities of that section nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended or the Securities Exchange Act of 1934, as amended, except as shall be expressly set forth by specific reference in such a filing.
2
EXHIBIT INDEX
Exhibit |
|
99.1 |
|
104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document). |
3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
G-III APPAREL GROUP, LTD. |
|
|
|
|
Date: September 5, 2024 |
By: |
/s/ Neal S. Nackman |
|
Name: |
Neal S. Nackman |
|
Title: |
Chief Financial Officer |
4
Exhibit 99.1
G-III APPAREL GROUP, LTD.
G-III APPAREL GROUP, LTD. REPORTS SECOND QUARTER FISCAL 2025 RESULTS ABOVE GUIDANCE; UPDATES FISCAL 2025 OUTLOOK
● | Net Sales of $644.8 Million for the Second Quarter Compared to $659.8 Million Last Year |
● | Second Quarter GAAP and Non-GAAP Net Income Per Diluted Share Exceed Guidance |
● | Raises GAAP and Non-GAAP Net Income Per Diluted Share Guidance for Fiscal Year 2025 |
● | Repaid $400 Million Senior Secured Notes Due August 2025 |
● | Repurchased 1.2 Million Shares of the Company’s Common Stock for $31.6 Million |
● | Announces New Global Apparel License for the Converse Brand |
New York, New York – September 5, 2024 -- G-III Apparel Group, Ltd. (NasdaqGS: GIII) today reported results for the second quarter of fiscal 2025 ended July 31, 2024.
Morris Goldfarb, G-III’s Chairman and Chief Executive Officer, said, “We delivered a strong first half of the year. Our second quarter non-GAAP net income per diluted share of $0.52 exceeded our expectations, led by our owned brands. DKNY and Karl Lagerfeld collectively grew double-digits and the Donna Karan relaunch has been incredibly successful, in addition to continued solid performance with healthy sell-throughs across the rest of our business.”
Mr. Goldfarb concluded, “Having the most desirable brands is central to our strategy and I am pleased with the transition to our go-forward portfolio, which will continue to evolve for the future. Our new businesses are working, and I am excited to announce a licensing agreement for Converse, Inc., a globally recognized American youth lifestyle brand. This new partnership represents a significant opportunity to expand our active lifestyle category while leveraging our core capabilities to build a global apparel business. The powerful combination of our brands, our business model and diverse growth drivers, together with our agility, operating discipline and strong foundation give us confidence that our strategy will deliver long-term shareholder value.”
Mr. Goldfarb concluded, “Given our second quarter earnings per diluted share outperformance, we are reaffirming our fiscal year 2025 net sales and, once again, raising our earnings per diluted share outlook. Despite the uncertain macroeconomic environment, we remain optimistic about the remainder of the year and our orderbook is in a good position for the important Fall and Holiday seasons.”
Results of Operations
Second Quarter Fiscal 2025 Financial Results
Net sales for the second quarter ended July 31, 2024 decreased 2% to $644.8 million compared to $659.8 million in the prior year’s second quarter.
Net income for the second quarter was $24.2 million, or $0.53 per diluted share, compared to $16.4 million, or $0.35 per diluted share, in the prior year’s second quarter.
1
Non-GAAP net income per diluted share was $0.52 for the second quarter compared to $0.40 in the same period last year. Non-GAAP net income per diluted share excludes (i) in the second quarter of fiscal 2025, the $0.6 million gain on the forgiveness of certain liabilities related to the acquisition of the minority interest of our DKNY business in China that we did not already own, (ii) in the second quarter of fiscal 2024, incentive compensation expenses of $1.8 million related to the Karl Lagerfeld transaction and (iii) in the second quarter of fiscal 2024, non-cash imputed interest expense of $1.1 million related to the note issued to seller as part of the consideration for the acquisition of Donna Karan International. The aggregate effect of these exclusions was equal to $(0.01) per diluted share in the second quarter of this year and $0.05 per diluted share in last year’s second quarter.
Balance Sheet as of Second Quarter Fiscal 2025
Inventories decreased 24% to $610.5 million at the end of this year’s second quarter compared to $804.9 million in the second quarter of last year.
During the quarter, we bought back 1,180,328 of our shares of common stock for an aggregate purchase price of $31.6 million.
Converse License
G-III signed a license agreement for Converse, Inc. to design and produce men’s and women’s apparel for distribution globally. The product is expected to launch in Fall 2025. Converse is an iconic American youth lifestyle brand and represents a significant opportunity for G-III to expand the active lifestyle business, providing exposure to a differentiated consumer and distribution network while leveraging existing fashion talent.
Outlook
The Company today updated its outlook for the fiscal year ending January 31, 2025. This outlook continues to anticipate approximately $60.0 million in incremental expenses, primarily associated with the launches of Donna Karan, Nautica and Halston. Approximately 65% of these expenses are related to marketing initiatives to support the Donna Karan and DKNY brands. The remaining costs are principally related to technology and talent to expand operational capabilities.
Fiscal 2025
Net sales are expected to increase by approximately 3% to $3.20 billion (unchanged to prior guidance), compared to net sales of $3.10 billion for fiscal 2024.
Net income is expected to be between $179.0 million and $184.0 million (prior $170.0 million and $175.0 million), or diluted earnings per share between $3.94 and $4.04 (prior $3.58 and $3.68). This compares to net income of $176.2 million, or $3.75 per diluted share, for fiscal 2024.
Non-GAAP net income for fiscal 2025 is expected to be between $180.0 million and $185.0 million (prior $170.0 and $175.0 million), or diluted earnings per share between $3.95 and $4.05 (prior $3.58 and $3.68). This compares to non-GAAP net income of $189.8 million, or diluted earnings per share of $4.04 for fiscal 2024.
2
Adjusted EBITDA for fiscal 2025 is expected to be between $305.0 million and $310.0 million (prior $295.0 million and $300.0 million) compared to adjusted EBITDA of $324.1 million in fiscal 2024.
Net interest expense is expected to be approximately $24.0 million, including a $1.7 million non-GAAP charge related to the write-off of deferred financing costs associated with the redemption of our senior secured notes. We estimate a tax rate of 28.5% for fiscal 2025.
Third Quarter Fiscal 2025
Net sales for the third quarter of fiscal 2025 are expected to increase by approximately 3% to $1.10 billion compared to $1.07 billion in the same period last year.
Net income for the third quarter of fiscal 2025 is expected to be in the range of $97.0 million and $102.0 million, or diluted earnings per share between $2.18 and $2.28. This compares to net income of $127.6 million, or diluted earnings per share of $2.74, in last year’s third quarter.
Non-GAAP net income for the third quarter of fiscal 2025 is expected to be between $98.0 million and $103.0 million, or diluted earnings per share between $2.20 and $2.30. This compares to non-GAAP net income of $129.6 million, or diluted earnings per share of $2.78, for the third quarter of fiscal 2024.
Non-GAAP Financial Measures
Reconciliations of GAAP net income to non-GAAP net income, GAAP net income per diluted share to non-GAAP net income per diluted share and GAAP net income to adjusted EBITDA are presented in tables accompanying the financial statements included in this release and provide useful information to evaluate the Company’s operational performance. A description of the amounts excluded on a non-GAAP basis are provided in conjunction with these tables. Non-GAAP net income, non-GAAP net income per diluted share and adjusted EBITDA should be evaluated in light of the Company’s financial statements prepared in accordance with GAAP.
About G-III Apparel Group, Ltd.
G-III Apparel Group, Ltd., a global leader in fashion with expertise in design, sourcing and marketing, owns and licenses a portfolio of over 30 preeminent brands. The Company is differentiated across unique brand propositions, product categories and consumer touch points. G-III owns ten iconic brands including, DKNY, Karl Lagerfeld, Donna Karan and Vilebrequin, and licenses over 20 brands, including Calvin Klein, Tommy Hilfiger, Nautica, Halston and National Sports leagues, among others.
Statements concerning G-III's business outlook or future economic performance, anticipated revenues, expenses or other financial items; product introductions and plans and objectives related thereto; and statements concerning assumptions made or expectations as to any future events, conditions, performance or other matters are "forward-looking statements" as that term is defined under the Federal Securities laws. Forward-looking statements are subject to risks, uncertainties and factors which include, but are not limited to, risks related to the reliance on licensed product, risks relating to G-III’s ability to increase revenues from sales of its other products, new acquired businesses or new license agreements as licenses for Calvin Klein and Tommy Hilfiger product expire on a staggered basis, reliance on foreign manufacturers, risks of doing business abroad, supply chain disruptions, risks related to acts of terrorism and the effects of war, the current economic and credit environment risks related to our indebtedness, the nature of the apparel industry,
3
including changing customer demand and tastes, customer concentration, seasonality, risks of operating a retail business, risks related to G-III’s ability to reduce the losses incurred in its retail operations, customer acceptance of new products, the impact of competitive products and pricing, dependence on existing management, possible disruption from acquisitions, the impact on G-III’s business of the imposition of tariffs by the United States government and business and general economic conditions, including inflation and higher interest rates, as well as other risks detailed in G-III's filings with the Securities and Exchange Commission. G-III assumes no obligation to update the information in this release.
4
G-III APPAREL GROUP, LTD. AND SUBSIDIARIES
(Nasdaq: GIII)
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
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|
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|
|
|
|
|
|
|
|
Three Months Ended July 31, |
|
Six Months Ended July 31, |
||||||||
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2024 |
|
2023 |
|
2024 |
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2023 |
||||
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(Unaudited) |
||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
644,755 |
|
$ |
659,761 |
|
$ |
1,254,502 |
|
$ |
1,266,350 |
Cost of goods sold |
|
|
368,881 |
|
|
383,108 |
|
|
719,735 |
|
|
739,897 |
Gross profit |
|
|
275,874 |
|
|
276,653 |
|
|
534,767 |
|
|
526,453 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
|
229,030 |
|
|
239,207 |
|
|
465,651 |
|
|
467,168 |
Depreciation and amortization |
|
|
5,380 |
|
|
5,959 |
|
|
14,148 |
|
|
12,535 |
Operating profit |
|
|
41,464 |
|
|
31,487 |
|
|
54,968 |
|
|
46,750 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other (loss) income |
|
|
(2,952) |
|
|
192 |
|
|
(3,175) |
|
|
1,165 |
Interest and financing charges, net |
|
|
(4,876) |
|
|
(9,492) |
|
|
(10,300) |
|
|
(21,642) |
Income before income taxes |
|
|
33,636 |
|
|
22,187 |
|
|
41,493 |
|
|
26,273 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
|
9,447 |
|
|
5,951 |
|
|
11,752 |
|
|
6,896 |
Net income |
|
|
24,189 |
|
|
16,236 |
|
|
29,741 |
|
|
19,377 |
Less: Loss attributable to noncontrolling interests |
|
|
(23) |
|
|
(202) |
|
|
(273) |
|
|
(297) |
Net income attributable to G-III Apparel Group, Ltd. |
|
$ |
24,212 |
|
$ |
16,438 |
|
$ |
30,014 |
|
$ |
19,674 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to G-III Apparel Group, Ltd. per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.54 |
|
$ |
0.36 |
|
$ |
0.67 |
|
$ |
0.43 |
Diluted |
|
$ |
0.53 |
|
$ |
0.35 |
|
$ |
0.65 |
|
$ |
0.42 |
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|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding: |
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|
|
|
|
|
|
|
|
|
|
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Basic |
|
|
44,569 |
|
|
45,714 |
|
|
45,022 |
|
|
45,996 |
Diluted |
|
|
45,483 |
|
|
46,570 |
|
|
46,105 |
|
|
46,992 |
|
|
|
|
|
|
|
Selected Balance Sheet Data (in thousands): |
|
As of July 31, |
||||
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|
2024 |
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2023 |
||
|
|
(Unaudited) |
||||
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
414,791 |
|
$ |
197,735 |
Working capital |
|
|
1,047,653 |
|
|
978,673 |
Inventories |
|
|
610,492 |
|
|
804,858 |
Total assets |
|
|
2,696,287 |
|
|
2,662,053 |
Total debt |
|
|
413,968 |
|
|
466,036 |
Operating lease liabilities |
|
|
218,733 |
|
|
247,544 |
Total stockholders' equity |
|
|
1,512,635 |
|
|
1,382,115 |
5
G-III APPAREL GROUP, LTD. AND SUBSIDIARIES
RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME
(In thousands)
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
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Six Months Ended |
||||||||
|
|
July 31, 2024 |
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July 31, 2023 |
|
July 31, 2024 |
|
July 31, 2023 |
||||
|
|
(Unaudited) |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income attributable to G-III Apparel Group, Ltd. |
|
$ |
24,212 |
|
$ |
16,438 |
|
$ |
30,014 |
|
$ |
19,674 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluded from non-GAAP: |
|
|
|
|
|
|
|
|
|
|
|
|
Gain on forgiveness of liabilities |
|
|
(600) |
|
|
— |
|
|
(600) |
|
|
— |
Expenses related to Karl Lagerfeld acquisition |
|
|
— |
|
|
1,848 |
|
|
— |
|
|
3,669 |
Non-cash imputed interest |
|
|
— |
|
|
1,086 |
|
|
— |
|
|
2,903 |
Income tax impact of non-GAAP adjustments |
|
|
168 |
|
|
(786) |
|
|
168 |
|
|
(1,724) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income attributable to G-III Apparel Group, Ltd., as defined |
|
$ |
23,780 |
|
$ |
18,586 |
|
$ |
29,582 |
|
$ |
24,522 |
Non-GAAP net income is a “non-GAAP financial measure” that excludes (i) in the second quarter of fiscal 2025, the gain on the forgiveness of certain liabilities related to the acquisition of the minority interest of our DKNY business in China that we did not already own, (ii) in the second quarter of fiscal 2024, incentive compensation expenses related to the Karl Lagerfeld transaction and (iii) in the second quarter of fiscal 2024, non-cash imputed interest expense. The income tax impact of non-GAAP adjustments is calculated using the effective tax rate for the period. Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding items that are not indicative of our core business operating results. Management uses these non-GAAP financial measures to assess our performance on a comparative basis and believes that they are also useful to investors to enable them to assess our performance on a comparative basis across historical periods and facilitate comparisons of our operating results to those of our competitors. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
6
G-III APPAREL GROUP, LTD. AND SUBSIDIARIES
RECONCILIATION OF GAAP NET INCOME PER SHARE TO NON-GAAP NET INCOME PER SHARE
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|
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Three Months Ended |
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Six Months Ended |
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|
July 31, 2024 |
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July 31, 2023 |
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July 31, 2024 |
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July 31, 2023 |
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(Unaudited) |
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|
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GAAP diluted net income attributable to G-III Apparel Group, Ltd. per common share |
|
$ |
0.53 |
|
$ |
0.35 |
|
$ |
0.65 |
|
$ |
0.42 |
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|
|
|
|
|
|
|
|
|
|
|
Excluded from non-GAAP: |
|
|
|
|
|
|
|
|
|
|
|
|
Gain on forgiveness of liabilities |
|
|
(0.01) |
|
|
— |
|
|
(0.01) |
|
|
— |
Expenses related to Karl Lagerfeld acquisition |
|
|
— |
|
|
0.04 |
|
|
— |
|
|
0.08 |
Non-cash imputed interest |
|
|
— |
|
|
0.03 |
|
|
— |
|
|
0.06 |
Income tax impact of non-GAAP adjustments |
|
|
— |
|
|
(0.02) |
|
|
— |
|
|
(0.04) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP diluted net income attributable to G-III Apparel Group, Ltd. per common share, as defined |
|
$ |
0.52 |
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$ |
0.40 |
|
$ |
0.64 |
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$ |
0.52 |
Non-GAAP diluted net income per common share is a “non-GAAP financial measure” that excludes (i) in the second quarter of fiscal 2025, the gain on the forgiveness of certain liabilities related to the acquisition of the minority interest of our DKNY business in China that we did not already own, (ii) in the second quarter of fiscal 2024, incentive compensation expenses related to the Karl Lagerfeld transaction and (iii) in the second quarter of fiscal 2024, non-cash imputed interest expense. The income tax impact of non-GAAP adjustments is calculated using the effective tax rate for the period. Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding items that are not indicative of our core business operating results. Management uses these non-GAAP financial measures to assess our performance on a comparative basis and believes that they are also useful to investors to enable them to assess our performance on a comparative basis across historical periods and facilitate comparisons of our operating results to those of our competitors. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
7
G-III APPAREL GROUP, LTD. AND SUBSIDIARIES
RECONCILIATION OF FORECASTED AND ACTUAL NET INCOME TO FORECASTED AND ACTUAL ADJUSTED EBITDA
(In thousands)
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|
|
|
|
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|
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|
|
|
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|
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Forecasted Twelve |
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Actual Twelve |
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Three Months Ended |
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Months Ending |
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Months Ended |
||||||
|
|
July 31, 2024 |
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July 31, 2023 |
|
January 31, 2025 |
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January 31, 2024 |
||||
|
|
(Unaudited) |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to G-III Apparel Group, Ltd. |
|
$ |
24,212 |
|
$ |
16,438 |
|
$ |
179,000 - 184,000 |
|
$ |
176,168 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on forgiveness of liabilities |
|
|
(600) |
|
|
— |
|
|
(600) |
|
|
— |
Write-off of deferred financing costs |
|
|
— |
|
|
— |
|
|
1,700 |
|
|
— |
Asset impairments |
|
|
— |
|
|
— |
|
|
— |
|
|
6,758 |
Expenses related to Karl Lagerfeld acquisition |
|
|
— |
|
|
1,848 |
|
|
— |
|
|
6,115 |
One-time expenses primarily related to our DKNY business in China |
|
|
— |
|
|
— |
|
|
— |
|
|
3,138 |
Change in fair value of earnout liability |
|
|
— |
|
|
— |
|
|
— |
|
|
(1,041) |
Depreciation and amortization |
|
|
5,380 |
|
|
5,959 |
|
|
31,000 |
|
|
27,523 |
Interest and financing charges, net |
|
|
4,876 |
|
|
9,492 |
|
|
22,000 |
|
|
39,595 |
Income tax expense |
|
|
9,447 |
|
|
5,951 |
|
|
71,900 |
|
|
65,859 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA, as defined |
|
$ |
43,315 |
|
$ |
39,688 |
|
$ |
305,000 - 310,000 |
|
$ |
324,115 |
Adjusted EBITDA is a “non-GAAP financial measure” which represents earnings before depreciation and amortization, interest and financing charges, net and income tax expense and excludes in fiscal 2025, (i) the gain on the forgiveness of certain liabilities related to the acquisition of the minority interest of our DKNY business in China that we did not already own, (ii) non-cash expense related to the write-off of deferred financing costs related to the redemption of our senior secured notes, and in fiscal 2024, (iii) asset impairments, (iv) incentive compensation expenses related to the Karl Lagerfeld transaction, (v) one-time expenses, primarily related to our DKNY business in China and (vi) the gain recorded from the reduction of the earnout liability related to our acquisition of Sonia Rykiel in fiscal 2022. Adjusted EBITDA is being presented as a supplemental disclosure because management believes that it is a common measure of operating performance in the apparel industry. Adjusted EBITDA should not be construed as an alternative to net income, as an indicator of the Company’s operating performance, or as an alternative to cash flows from operating activities as a measure of the Company’s liquidity, as determined in accordance with GAAP.
8
G-III APPAREL GROUP, LTD. AND SUBSIDIARIES
RECONCILIATION OF FORECASTED AND ACTUAL GAAP NET INCOME TO FORECASTED AND ACTUAL NON-GAAP NET INCOME
(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forecasted Three |
|
Actual Three |
|
Forecasted Twelve |
|
Actual Twelve |
||||
|
|
Months Ending |
|
Months Ended |
|
Months Ending |
|
Months Ended |
||||
|
|
October 31, 2024 |
|
October 31, 2023 |
|
January 31, 2025 |
|
January 31, 2024 |
||||
|
|
(Unaudited) |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to G-III Apparel Group, Ltd. |
|
$ |
97,000-102,000 |
|
$ |
127,640 |
|
$ |
179,000 - 184,000 |
|
$ |
176,168 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluded from non-GAAP: |
|
|
|
|
|
|
|
|
|
|
|
|
Gain on forgiveness of liabilities |
|
|
— |
|
|
— |
|
|
(600) |
|
|
— |
Write-off of deferred financing costs |
|
|
1,700 |
|
|
— |
|
|
1,700 |
|
|
— |
Asset impairments |
|
|
— |
|
|
222 |
|
|
— |
|
|
6,758 |
Expenses related to Karl Lagerfeld acquisition |
|
|
— |
|
|
1,847 |
|
|
— |
|
|
6,115 |
Non-cash imputed interest |
|
|
— |
|
|
682 |
|
|
— |
|
|
3,798 |
One-time expenses primarily related to our DKNY business in China |
|
|
— |
|
|
— |
|
|
— |
|
|
3,138 |
Change in fair value of earnout liability |
|
|
— |
|
|
— |
|
|
— |
|
|
(1,041) |
Income tax impact of non-GAAP adjustments |
|
|
(700) |
|
|
(761) |
|
|
(100) |
|
|
(5,137) |
Non-GAAP net income attributable to G-III Apparel Group, Ltd., as defined |
|
$ |
98,000-103,000 |
|
$ |
129,630 |
|
$ |
180,000 - 185,000 |
|
$ |
189,799 |
Non-GAAP net income is a “non-GAAP financial measure” that excludes in fiscal 2025, (i) the gain on the forgiveness of certain liabilities related to the acquisition of the minority interest of our DKNY business in China that we did not already own, (ii) non-cash expense related to the write-off of deferred financing costs related to the redemption of our senior secured notes, and in fiscal 2024, (iii) asset impairments, (iv) incentive compensation expenses related to the Karl Lagerfeld transaction, (v) non-cash imputed interest expense, (vi) one-time expenses, primarily related to our DKNY business in China and (vii) the gain recorded from the reduction of the earnout liability related to our acquisition of Sonia Rykiel in fiscal 2022. The income tax impact of non-GAAP adjustments is calculated using an effective tax for the period. Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding items that are not indicative of our core business operating results. Management uses these non-GAAP financial measures to assess our performance on a comparative basis and believes that they are also useful to investors to enable them to assess our performance on a comparative basis across historical periods and facilitate comparisons of our operating results to those of our competitors. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
9
G-III APPAREL GROUP, LTD. AND SUBSIDIARIES
RECONCILIATION OF FORECASTED AND ACTUAL GAAP NET INCOME PER SHARE TO FORECASTED AND ACTUAL NON-GAAP NET INCOME PER SHARE
|
|
Forecasted Three |
|
Actual Three |
|
Forecasted Twelve |
|
Actual Twelve |
||||
|
|
Months Ending |
|
Months Ended |
|
Months Ending |
|
Months Ended |
||||
|
|
October 31, 2024 |
|
October 31, 2023 |
|
January 31, 2025 |
|
January 31, 2024 |
||||
|
|
(Unaudited) |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted net income attributable to G-III Apparel Group, Ltd. per common share |
|
$ |
2.18 - 2.28 |
|
$ |
2.74 |
|
$ |
3.94 - 4.04 |
|
$ |
3.75 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluded from non-GAAP: |
|
|
|
|
|
|
|
|
|
|
|
|
Gain on forgiveness of liabilities |
|
|
— |
|
|
— |
|
|
(0.01) |
|
|
— |
Write-off of deferred financing costs |
|
|
0.03 |
|
|
— |
|
|
0.03 |
|
|
— |
Asset impairments |
|
|
— |
|
|
0.01 |
|
|
— |
|
|
0.14 |
Expenses related to Karl Lagerfeld acquisition |
|
|
— |
|
|
0.04 |
|
|
— |
|
|
0.13 |
Non-cash imputed interest |
|
|
— |
|
|
0.01 |
|
|
— |
|
|
0.08 |
One-time expenses primarily related to our DKNY business in China |
|
|
— |
|
|
— |
|
|
— |
|
|
0.07 |
Change in fair value of earnout liability |
|
|
— |
|
|
— |
|
|
— |
|
|
(0.02) |
Income tax impact of non-GAAP adjustments |
|
|
(0.01) |
|
|
(0.02) |
|
|
(0.01) |
|
|
(0.11) |
Non-GAAP diluted net income attributable to G-III Apparel Group, Ltd. per common share, as defined |
|
$ |
2.20 - 2.30 |
|
$ |
2.78 |
|
$ |
3.95 - 4.05 |
|
$ |
4.04 |
Non-GAAP diluted net income per common share is a “non-GAAP financial measure” that excludes in fiscal 2025, (i) the gain on the forgiveness of certain liabilities related to the acquisition of the minority interest of our DKNY business in China that we did not already own, (ii) non-cash expense related to the write-off of deferred financing costs related to the redemption of our senior secured notes, and in fiscal 2024, (iii) asset impairments, (iv) incentive compensation expenses related to the Karl Lagerfeld transaction, (v) non-cash imputed interest expense, (vi) one-time expenses, primarily related to our DKNY business in China and (vii) the gain recorded from the reduction of the earnout liability related to our acquisition of Sonia Rykiel in fiscal 2022. The income tax impact of non-GAAP adjustments is calculated using an effective tax for the period. Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding items that are not indicative of our core business operating results. Management uses these non-GAAP financial measures to assess our performance on a comparative basis and believes that they are also useful to investors to enable them to assess our performance on a comparative basis across historical periods and facilitate comparisons of our operating results to those of our competitors. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
G-III Apparel Group, Ltd.
Company Contact:
Priya Trivedi
SVP of Investor Relations and Treasurer
(646) 473-5228
Company Media Contact:
Andrew Blecher
andrew.blecher@g-iii.com
10