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Calvin Klein and Tommy Hilfiger drive profits up at PVH

PVH has reported a 17.3% rise in net profit to $196.6m (£119.7m) for the three months to November 3, driven by the acquisition of the Calvin Klein and Tommy Hilfiger brands.

Turnover for the period soared 37.5% year on year to $2.26bn (£1.38bn) due to the addition of approximately $503m (£306m) of revenue related to the acquisition of Warnaco in early in 2013.

Turnover in the Calvin Klein business increased by 150% to $800m (£487m) from $320m (£195m) in the prior year’s third quarter. Pre-tax profits at Calvin Klein business increased by 56% to $144m (£87.7m) year on year.

The Calvin Klein businesses in Asia and Brazil performed well in the quarter, as did the global underwear business that came to PVH as part of Warnaco. However, the Calvin Klein jeans business, particularly in North America and Europe, continued to underperform and be an area of “management focus, investment and repositioning” for the group.

Tommy Hilfiger saw turnover increase by 10% to $920.7m (£561m), while pre-tax profits increased 6% to $143m (£87m) for the period.

Emanuel Chirico, chairman and chief executive of PVH, said: “Investments in the newly acquired businesses, which will continue into 2014, will further focus on enhancing the existing operating infrastructure.”

Chirico said the company would also expand the team, “filling a significant number of key open positions”, and plans to upgrade the quality and design of Calvin Klein jeans and improving the business’ store environment.

Due to the competitive and highly promotional festive selling period, the group has maintained its full year earnings per share guidance of $7.00. (£4.3)

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