G-III Apparel Posts Mixed Q2 Results; Cuts FY23 Guidance

• G-III Apparel Group Ltd (NASDAQ: GIII) reported second-quarter FY23 sales growth of 25% year-on-year to $605.24 million, beating the consensus of $594.78 million.

• The gross profit rose 18.7% Y/Y to $228.9 million, with the margin contracting 210 basis points to 37.8%.

• Operating income for the quarter fell 19.7% to $31.3 million.

• Adjusted EPS of $0.39 missed the analyst consensus of $0.47.

• The company held $150.9 million in cash and equivalents as of July 31, 2022.

• "Given the challenging environment that has rapidly developed over the last few months, we are taking a more conservative view for the balance of the year," said Chairman and CEO Morris Goldfarb.

• Outlook: G-III sees FY23 sales of about $3.15 billion (prior view $3.24 billion), below the consensus of $3.19 billion. It expects FY23 adjusted EPS of $3.60 - $3.70 (previous view: $4.40 - $4.50) versus the consensus of $4.23.

• The company expects Q3 adjusted EPS of $1.80 - $1.90, below the consensus of $2.15. It anticipates Q3 sales of $1.07 billion, below the consensus of $1.11 billion.

• Price Action: GIII shares are trading lower by 0.71% at $19.70 in premarket on the last check Wednesday.

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