Inside Licensing News and Notes, Dec. 4, 2017
Five Below Boosts Year-End Sales Forecast
Five Below boosted its forecast revenue 2.2% to $1.276 billion for the fiscal year ending in January, owing to strong sales of licensed goods and trend products such as spinners and mermaid blankets, CEO Joel Anderson told analysts. The projected full-year same-store sales increase rose to 5.7-6.5% from 3.5-4.5%, while the earnings range was boosted to $1.72-$1.79 from $1.62-$1.66. Five Below’s Q4 earnings are expected to benefit from sales tied to Star Wars: The Last Jedi, which opens Dec. 17.
The improved earnings guidance was also partly tied to the spinner craze of earlier this year bringing new customers into Five Below stores, Anderson said. Five Below also expects to have opened 103 stores this year, expanding the chain to 625 outlets. Overall, Five Below’s net income rose 81.4% to $9.9 million in Q3 ended Oct. 28 as sales increased 28.9% to $257.2 million on an 8.5% boost in same-store sales.
Five Below, Ken Bull, Chief Financial Officer, 215-546-7909
JC Penney Pulls Russell Simmons Menswear
JC Penney pulled Russell Simmons’ menswear line from the 80 stores where it was being sold after the media mogul was accused of sexual misconduct by two women. The Argyleculture collection, which Bernette Textile developed with Simmons, launched at JC Penney in September 2016. About 60 Argyleculyure products remained available for sale on Amazon Monday afternoon.
Bernette Textile, Jeff Siskind, Pres., 212-279-5526
J.C. Penney, Jeffrey Davis, Chief Financial Officer, 972-431-1000
Perry Ellis Shifts to Licensing for Laundry by Shelli Segal Dresses
Perry Ellis International is licensing out its Laundry by Shelly Segal dress business, signing an agreement with NMNY Group that will target department store and specialty chains, company executives told analysts.
“The decision to license Laundry dresses will not only bring greater focus on the men’s and women’s sportswear businesses where we have greater scale, but also allow it to have the support needed to maximize the full potential of the brand,” Perry Ellis’ Jorge Narino said. The Laundry dress business produced about $12-$14 million in annual revenue with a $4-$5 million gross margin, Feldenkreis said.
Overall, Perry Ellis’ swung to a $3.2 million profit in Q3 from a $5.1 million loss a year earlier as sales rose 2.5% to $198.8 million. Licensing declined 2.3% to $8.4 million, while merchandise sales grew 2.7%% to $190.3 million. The change to outbound licensing was partly responsible for a slight decline in Perry Ellis’ womenswear Q3 revenue to $28 million.
Perry Ellis International, Jorge Narino, interim Chief Financial Officer, 305-873-1251, email@example.com