G-III Apparel Group, Ltd. Reports First Quarter Fiscal 2026 Results
- Net Income Per Diluted Share of $0.17 for the First Quarter Compared to $0.12 Last Year and Non-GAAP Net Income Per Diluted Share of $0.19 for the First Quarter Compared to $0.12 Last Year, Both Exceeding Guidance
- Net Sales of $583.6 Million for the First Quarter Compared to $609.7 Million Last Year
- Repurchases of $19.7 Million or 807,437 Shares in the First Quarter
- Reaffirms Net Sales Guidance for Fiscal 2026
New York, NY — G-III Apparel Group reported results for the first quarter of fiscal 2026, ended April 30, 2025.
Morris Goldfarb, G-III’s Chairman and Chief Executive Officer, said, “G-III delivered solid first quarter results, marked by earnings that exceeded the high end of guidance. Our performance was fueled by double-digit growth of our key owned brands, DKNY, Karl Lagerfeld and Donna Karan, which largely offset the exit of the Calvin Klein jeans and sportswear businesses. These results underscore the strong demand and desirability of our brand portfolio and are a testament to our team’s outstanding execution.”
Mr. Goldfarb concluded, “We are reaffirming our net sales guidance for fiscal 2026 and working diligently to mitigate the impact of tariffs. Our experienced management team has a proven track record of successfully navigating periods of uncertainty, and we view the ongoing disruptions as an opportunity to strengthen our competitive position and capture incremental market share. As we advance our strategic priorities, we have never been more confident in the global resonance of our brands and the significant growth potential ahead to drive long-term profitability and shareholder value.”
Results of Operations
First Quarter Fiscal 2026
Net sales for the first quarter ended April 30, 2025 decreased 4% to $583.6 million compared to $609.7 million in the prior year’s quarter.
Net income for the first quarter ended April 30, 2025 was $7.8 million, or $0.17 per diluted share, compared to $5.8 million, or $0.12 per diluted share, in the prior year’s quarter.
Non-GAAP net income per diluted share was $0.19 for the first quarter ended April 30, 2025 compared to $0.12 in the same period last year. Non-GAAP net income per diluted share in the first quarter of fiscal 2026 excludes $1.0 million in one-time severance expenses related to a closed warehouse. There were no non-GAAP adjustments during the first quarter of fiscal 2025. The effect of this exclusion was equal to $0.02 per diluted share in the first quarter of this year.
Balance Sheet as of First Quarter Fiscal 2026
Inventories decreased 5% to $456.5 million this year compared to $479.7 million last year.
Total debt decreased 96% to $18.7 million this year compared to $426.4 million last year. In August 2024, we voluntarily redeemed the entire $400.0 million principal amount of our senior secured notes (the “Notes”) at a redemption price equal to 100% of the principal amount of the Notes plus accrued and unpaid interest. The payment was made with cash on hand and borrowings from the revolving credit facility.
Capital Allocation
Share repurchases of 807,437 for $19.7 million were made in the first quarter ended April 30, 2025.
Outlook
The Company has reaffirmed its net sales outlook for fiscal 2026. Due to uncertainty around tariffs and related macroeconomic conditions, the Company has withdrawn its net income, non-GAAP net income and adjusted EBITDA guidance for fiscal 2026 issued on March 13, 2025. Based on the tariff rates in place on June 5, 2025, the Company anticipates the unmitigated cost of tariffs on goods imported into the United States will result in additional expense of approximately $135.0 million, which is expected to primarily be weighted to the second half of the year. The Company is diligently working to offset these costs through (i) diversifying our sourcing mix and vendor discounts, (ii) selective price increases and (iii) other cost saving initiatives.
In addition, the Company today provided its outlook for its second quarter ending July 31, 2025.
Fiscal 2026
Net sales are expected to be approximately $3.14 billion. This compares to net sales of $3.18 billion for fiscal 2025. As previously planned, the Company continues to expect sales in the first half of fiscal 2026 to be lower as compared to the previous year, with acceleration expected in the second half of fiscal 2026.
Second Quarter Fiscal 2026
Net sales for the second quarter of fiscal 2026 are expected to be approximately $570.0 million. Net sales are expected to be negatively impacted by supply chain challenges and timing shifts in certain programs into the second half of this year. This compares to net sales of $644.8 million in last year’s second quarter. Gross margins are expected to be comparable to the prior year’s second quarter.
Net income for the second quarter of fiscal 2026 is expected to be between $1.0 million and $6.0 million, or diluted earnings per share between $0.02 and $0.12. This compares to net income of $24.2 million, or $0.53 per diluted share, in last year’s second quarter.
| G-III APPAREL GROUP, LTD. AND SUBSIDIARIES (Nasdaq: GIII) CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share amounts) |
||||||||
| Three Months Ended April 30, | ||||||||
| 2025 | 2024 | |||||||
| (Unaudited) | ||||||||
| Net sales | $ | 583,609 | $ | 609,747 | ||||
| Cost of goods sold | 337,065 | 350,854 | ||||||
| Gross profit | 246,544 | 258,893 | ||||||
| Selling, general and administrative expenses | 231,495 | 236,621 | ||||||
| Depreciation and amortization | 6,573 | 8,768 | ||||||
| Operating profit | 8,476 | 13,504 | ||||||
| Other income (loss) | 3,462 | (223 | ) | |||||
| Interest and financing charges, net | (461 | ) | (5,424 | ) | ||||
| Income before income taxes | 11,477 | 7,857 | ||||||
| Income tax expense | 3,718 | 2,305 | ||||||
| Net income | 7,759 | 5,552 | ||||||
| Less: loss attributable to noncontrolling interests | — | (250 | ) | |||||
| Net income attributable to G-III Apparel Group, Ltd. | $ | 7,759 | $ | 5,802 | ||||
| Net income attributable to G-III Apparel Group, Ltd. per common share: | ||||||||
| Basic | $ | 0.18 | $ | 0.13 | ||||
| Diluted | $ | 0.17 | $ | 0.12 | ||||
| Weighted average shares outstanding: | ||||||||
| Basic | 43,748 | 45,484 | ||||||
| Diluted | 45,385 | 46,734 | ||||||
| Selected Balance Sheet Data (in thousands): | As of April 30, | |||||||
| 2025 | 2024 | |||||||
| (Unaudited) | ||||||||
| Cash and cash equivalents | $ | 257,785 | $ | 508,434 | ||||
| Working capital | 817,509 | 1,140,449 | ||||||
| Inventories | 456,482 | 479,671 | ||||||
| Total assets | 2,415,873 | 2,565,399 | ||||||
| Total debt | 18,742 | 426,351 | ||||||
| Operating lease liabilities | 269,922 | 224,452 | ||||||
| Total stockholders’ equity | 1,684,094 | 1,519,875 | ||||||
| G-III APPAREL GROUP, LTD. AND SUBSIDIARIES RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME (In thousands) |
||||||||
| Three Months Ended | ||||||||
| April 30, 2025 | April 30, 2024 | |||||||
| (Unaudited) | ||||||||
| GAAP net income attributable to G-III Apparel Group, Ltd. | $ | 7,759 | $ | 5,802 | ||||
| Excluded from non-GAAP: | ||||||||
| One-time warehouse related severance expenses | 978 | — | ||||||
| Income tax impact of non-GAAP adjustments | (316 | ) | — | |||||
| G-III APPAREL GROUP, LTD. AND SUBSIDIARIES RECONCILIATION OF GAAP NET INCOME PER SHARE TO NON-GAAP NET INCOME PER SHARE |
||||||||
| Three Months Ended | ||||||||
| April 30, 2025 | April 30, 2024 | |||||||
| (Unaudited) | ||||||||
| GAAP diluted net income attributable to G-III Apparel Group, Ltd. per common share | $ | 0.17 | $ | 0.12 | ||||
| Excluded from non-GAAP: | ||||||||
| One-time warehouse related severance expenses | 0.03 | — | ||||||
| Income tax impact of non-GAAP adjustments | (0.01 | ) | — | |||||
| Non-GAAP diluted net income attributable to G-III Apparel Group, Ltd. per common share, as defined | $ | 0.19 | $ | 0.12 | ||||
| G-III APPAREL GROUP, LTD. AND SUBSIDIARIES RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA (In thousands) |
||||||||
| Three Months Ended | ||||||||
| April 30, 2025 | April 30, 2024 | |||||||
| (Unaudited) | ||||||||
| Net income attributable to G-III Apparel Group, Ltd. | $ | 7,759 | $ | 5,802 | ||||
| One-time warehouse related severance expenses | 978 | — | ||||||
| Depreciation and amortization | 6,573 | 8,768 | ||||||
| Interest and financing charges, net | 461 | 5,424 | ||||||
| Income tax expense | 3,718 | 2,305 | ||||||
| Adjusted EBITDA, as defined | $ | 19,489 | $ | 22,299 | ||||
| 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 | |||||||
| Months Ending | Months Ended | |||||||
| July 31, 2025 | July 31, 2024 | |||||||
| (Unaudited) | ||||||||
| Net income attributable to G-III Apparel Group, Ltd. | $ | 1,000 – 6,000 | $ | 24,212 | ||||
| Excluded from non-GAAP: | ||||||||
| Gain on forgiveness of liabilities | — | (600 | ) | |||||
| Income tax impact of non-GAAP adjustments | — | 168 | ||||||
| Non-GAAP net income attributable to G-III Apparel Group, Ltd., as defined | $ | 1,000 – 6,000 | $ | 23,780 | ||||
| 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 | |||||||
| Months Ending | Months Ended | |||||||
| July 31, 2025 | July 31, 2024 | |||||||
| (Unaudited) | ||||||||
| GAAP diluted net income attributable to G-III Apparel Group, Ltd. per common share | $ | 0.02 – 0.12 | $ | 0.53 | ||||
| Excluded from non-GAAP: | ||||||||
| Gain on forgiveness of liabilities | — | (0.01 | ) | |||||
| Income tax impact of non-GAAP adjustments | — | — | ||||||
| Non-GAAP diluted net income attributable to G-III Apparel Group, Ltd. per common share, as defined | $ | 0.02 – 0.12 | $ | 0.52 | ||||
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