G-III Apparel Group, Ltd. Announces First Quarter Fiscal 2023 Results
—
—
— Net Income Per Diluted Share for the First Quarter was
— Non-GAAP Net Income Per Diluted Share for the First Quarter was
— G-III Raises Guidance for Fiscal Year 2023 —
Net sales for the first quarter ended
Non-GAAP net income per diluted share was
Outlook
The Company today raised its guidance for the fiscal year ending
For fiscal 2023, the Company expects net sales of approximately
The Company is anticipating non-GAAP net income for fiscal 2023 between
The Company is projecting full-year adjusted EBITDA for fiscal 2023 between
For the second quarter of fiscal year 2023, the Company expects net sales of approximately
The Company is anticipating non-GAAP net income for the second quarter of fiscal 2023 between
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 condensed financial statements included in this release and provide useful information to evaluate the Company’s operational performance. 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 designs, sources and markets apparel and accessories under owned, licensed and private label brands. G-III’s substantial portfolio of more than 30 licensed and proprietary brands is anchored by five global power brands:
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
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(Nasdaq: GIII) |
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CONDENSED CONSOLIDATED STATEMENTS OF INCOME |
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(In thousands, except per share amounts) |
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|
|
|
|
|
|
|
|
|
Three Months Ended |
||||
|
|
2022 |
|
2021 |
||
|
|
(Unaudited) |
||||
|
|
|
|
|
|
|
Net sales |
|
$ |
688,757 |
|
$ |
519,910 |
Cost of goods sold |
|
|
442,718 |
|
|
324,441 |
Gross profit |
|
|
246,039 |
|
|
195,469 |
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
|
185,407 |
|
|
141,603 |
Depreciation and amortization |
|
|
6,095 |
|
|
7,044 |
Operating profit |
|
|
54,537 |
|
|
46,822 |
|
|
|
|
|
|
|
Other (loss) income |
|
|
(2,708) |
|
|
1,820 |
Interest and financing charges, net |
|
|
(12,203) |
|
|
(12,004) |
Income before income taxes |
|
|
39,626 |
|
|
36,638 |
|
|
|
|
|
|
|
Income tax expense |
|
|
9,000 |
|
|
10,259 |
Net income |
|
|
30,626 |
|
|
26,379 |
Less: (Loss) income attributable to noncontrolling interests |
|
|
(8) |
|
|
58 |
Net income attributable to |
|
$ |
30,634 |
|
$ |
26,321 |
|
|
|
|
|
|
|
Net income attributable to |
|
|
|
|
|
|
Basic |
|
$ |
0.64 |
|
$ |
0.54 |
Diluted |
|
$ |
0.62 |
|
$ |
0.53 |
|
|
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
|
|
Basic |
|
|
48,016 |
|
|
48,377 |
Diluted |
|
|
49,108 |
|
|
49,510 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Balance Sheet Data (in thousands): |
|
As of |
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|
|
2022 |
|
2021 |
||
|
|
(Unaudited) |
||||
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
438,411 |
|
$ |
396,311 |
Working capital |
|
|
1,164,595 |
|
|
976,365 |
Inventories |
|
|
550,059 |
|
|
346,668 |
Total assets |
|
|
2,718,272 |
|
|
2,398,720 |
Long-term debt |
|
|
521,382 |
|
|
514,889 |
Operating lease liabilities |
|
|
180,798 |
|
|
198,874 |
Total stockholders' equity |
|
|
1,558,292 |
|
|
1,357,876 |
|
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RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME AND |
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RECONCILIATION OF GAAP NET INCOME PER SHARE TO NON-GAAP NET INCOME PER |
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SHARE |
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(In thousands, except per share amounts) |
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|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Three Months Ended |
||
|
|
|
|
|
||
|
(Unaudited) |
|||||
|
|
|
|
|
|
|
GAAP net income attributable to |
|
$ |
30,634 |
|
$ |
26,321 |
|
|
|
|
|
|
|
Excluded from non-GAAP: |
|
|
|
|
|
|
Expenses related to Karl Lagerfeld acquisition |
|
|
4,179 |
|
|
— |
Non-cash imputed interest |
|
|
1,671 |
|
|
1,536 |
Income tax impact of non-GAAP adjustments |
|
|
(1,328) |
|
|
(430) |
|
|
|
|
|
|
|
Non-GAAP net income attributable to |
|
$ |
35,156 |
|
$ |
27,427 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Three Months Ended |
||
|
|
|
|
|
||
|
(Unaudited) |
|||||
|
|
|
|
|
|
|
GAAP diluted net income attributable to |
|
$ |
0.62 |
|
$ |
0.53 |
|
|
|
|
|
|
|
Excluded from non-GAAP: |
|
|
|
|
|
|
Expenses related to Karl Lagerfeld acquisition |
|
|
0.09 |
|
|
- |
Non-cash imputed interest |
|
|
0.04 |
|
|
0.04 |
Income tax impact of non-GAAP adjustments |
|
|
(0.03) |
|
|
(0.01) |
|
|
|
|
|
|
|
Non-GAAP diluted net income attributable to G-III Apparel
|
|
$ |
0.72 |
|
$ |
0.56 |
Non-GAAP net income and diluted net income per common share are each a “non-GAAP financial measure” that excludes (i) expenses related to the Karl Lagerfeld transaction that include professional fees and foreign currency losses and (ii) non-cash imputed interest expense. The income tax impact of non-GAAP adjustments is calculated using the effective tax rates for the respective periods. 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 it is 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.
|
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RECONCILIATION OF FORECASTED AND ACTUAL NET INCOME TO FORECASTED AND |
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ACTUAL ADJUSTED EBITDA |
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(In thousands) |
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|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Forecasted Twelve |
|
Actual Twelve |
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|
|
Three Months Ended |
|
Three Months Ended |
|
Months Ended |
|
Months Ended |
||||
|
|
|
|
|
|
|
|
|
||||
|
(Unaudited) |
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to |
|
$ |
30,634 |
|
$ |
26,321 |
|
$ |
205,000 - 215,000 |
|
$ |
200,593 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset impairments, net of gain on lease terminations |
|
|
— |
|
|
— |
|
|
— |
|
|
1,455 |
Depreciation and amortization |
|
|
6,095 |
|
|
7,044 |
|
|
31,512 |
|
|
27,626 |
Interest and financing charges, net |
|
|
12,203 |
|
|
12,004 |
|
|
49,936 |
|
|
49,666 |
Income tax expense |
|
|
9,000 |
|
|
10,259 |
|
|
73,552 |
|
|
70,875 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA, as defined |
|
$ |
57,932 |
|
$ |
55,628 |
|
$ |
360,000 - 370,000 |
|
$ |
350,215 |
Adjusted EBITDA is a “non-GAAP financial measure” which represents earnings before depreciation and amortization, interest and financing charges, net and income tax expense. 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.
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RECONCILIATION OF FORECASTED AND ACTUAL NET INCOME TO FORECASTED AND |
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ACTUAL NON-GAAP INCOME |
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(In thousands) |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forecasted Three |
|
Actual Three |
|
Forecasted Twelve |
|
Actual Twelve |
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|
|
Months Ending |
|
Months Ended |
|
Months Ended |
|
Months Ended |
||||
|
|
|
|
|
|
|
|
|
||||
|
(Unaudited) |
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to |
|
$ |
20,000 - 25,000 |
|
$ |
19,168 |
|
$ |
205,000 - 215,000 |
|
$ |
200,593 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluded from non-GAAP: |
|
|
|
|
|
|
|
|
|
|
|
|
Expenses related to Karl Lagerfeld acquisition |
|
|
— |
|
|
— |
|
|
4,179 |
|
|
2,093 |
Non-cash imputed interest |
|
|
1,740 |
|
|
1,599 |
|
|
6,947 |
|
|
6,385 |
Asset impairments, net of gain on lease terminations |
|
|
— |
|
|
— |
|
|
— |
|
|
1,455 |
Income tax impact of non-GAAP adjustments |
|
|
(740) |
|
|
(510) |
|
|
(3,126) |
|
|
(2,602) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income attributable to G-III Apparel
|
|
$ |
21,000 - 26,000 |
|
$ |
20,257 |
|
$ |
213,000 - 223,000 |
|
$ |
207,924 |
Non-GAAP net income is a “non-GAAP financial measure” that excludes (i) expenses related to the Karl Lagerfeld transaction that include professional fees and foreign currency losses, (ii) non-cash imputed interest expense and (iii) asset impairments, net of gains on lease terminations. The income tax impact of non-GAAP adjustments is calculated using the effective tax rates for the respective periods. Management believes that this non-GAAP financial measure provides meaningful supplemental information regarding our performance by excluding items that are not indicative of our core business operating results. Management uses this non-GAAP financial measure to assess our performance on a comparative basis and believes that it is 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.
|
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RECONCILIATION OF FORECASTED AND ACTUAL NET INCOME PER SHARE TO |
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FORECASTED AND ACTUAL NON-GAAP INCOME PER SHARE |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forecasted Three |
|
Actual Three |
|
Forecasted Twelve |
|
Actual Twelve |
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|
|
Months Ending |
|
Months Ended |
|
Months Ended |
|
Months Ended |
||||
|
|
|
|
|
|
|
|
|
||||
|
(Unaudited) |
|||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted net income attributable to G-III
|
|
$ |
0.42 - 0.52 |
|
$ |
0.39 |
|
$ |
4.23 - 4.33 |
|
$ |
4.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluded from non-GAAP: |
|
|
|
|
|
|
|
|
|
|
|
|
Expenses related to Karl Lagerfeld acquisition |
|
|
— |
|
|
— |
|
|
0.08 |
|
|
0.04 |
Non-cash imputed interest |
|
|
0.04 |
|
|
0.03 |
|
|
0.14 |
|
|
0.13 |
Asset impairments, net of gain on lease terminations |
|
|
— |
|
|
— |
|
|
— |
|
|
0.03 |
Income tax impact of non-GAAP adjustments |
|
|
(0.01) |
|
|
(0.01) |
|
|
(0.05) |
|
|
(0.05) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP diluted net income attributable to G-III
|
|
$ |
0.45 - 0.55 |
|
$ |
0.41 |
|
$ |
4.40 - 4.50 |
|
$ |
4.20 |
Non-GAAP diluted net income per share is a “non-GAAP financial measure” that excludes (i) expenses related to the Karl Lagerfeld transaction that include professional fees and foreign currency losses, (ii) non-cash imputed interest expense and (iii) asset impairments, net of gains on lease terminations. The income tax impact of non-GAAP adjustments is calculated using the effective tax rates for the respective periods. Management believes that this non-GAAP financial measure provides meaningful supplemental information regarding our performance by excluding items that are not indicative of our core business operating results. Management uses this non-GAAP financial measure to assess our performance on a comparative basis and believes that it is 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.
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FISCAL 2022 QUARTERLY RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET |
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INCOME |
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(In thousands) |
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Three Months Ended |
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Fiscal Year Ended |
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|
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|
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|
|||||
|
|
2021 |
|
2021 |
|
2021 |
|
2022 |
|
2022 |
|||||
|
|
(Unaudited) |
|||||||||||||
Net income attributable to |
|
$ |
26,321 |
|
$ |
19,168 |
|
$ |
106,674 |
|
$ |
48,430 |
|
$ |
200,593 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluded from non-GAAP: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses related to Karl Lagerfeld acquisition |
|
|
— |
|
|
— |
|
|
— |
|
|
2,093 |
|
|
2,093 |
Non-cash imputed interest |
|
|
1,536 |
|
|
1,599 |
|
|
1,608 |
|
|
1,642 |
|
|
6,385 |
Asset impairments, net of gain on lease terminations |
|
|
— |
|
|
— |
|
|
— |
|
|
1,455 |
|
|
1,455 |
Income tax impact of non-GAAP adjustments |
|
|
(430) |
|
|
(510) |
|
|
(397) |
|
|
(1,260) |
|
|
(2,598) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income attributable to G-III Apparel
|
|
$ |
27,427 |
|
$ |
20,257 |
|
$ |
107,885 |
|
$ |
52,360 |
|
$ |
207,928 |
Non-GAAP net income is a “non-GAAP financial measure” that excludes (i) expenses related to the Karl Lagerfeld transaction that include professional fees and foreign currency losses, (ii) non-cash imputed interest expense and (iii) asset impairments, net of gains on lease terminations. The income tax impact of non-GAAP adjustments is calculated using the effective tax rates for the respective periods. Management believes that this non-GAAP financial measure provides meaningful supplemental information regarding our performance by excluding items that are not indicative of our core business operating results. Management uses this non-GAAP financial measure to assess our performance on a comparative basis and believes that it is 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.
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FISCAL 2022 QUARTERLY RECONCILIATION OF GAAP NET INCOME PER SHARE TO |
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NON-GAAP NET INCOME PER SHARE |
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|
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|
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|
|
|
|
|
|
|
|
Three Months Ended |
|
Fiscal Year Ended |
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|
|
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|
|
|
|||||
|
|
2021 |
|
2021 |
|
2021 |
|
2022 |
|
2022 |
|||||
|
|
(Unaudited) |
|||||||||||||
GAAP diluted net income attributable to G-III
|
|
$ |
0.53 |
|
$ |
0.39 |
|
$ |
2.16 |
|
$ |
0.98 |
|
$ |
4.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluded from non-GAAP: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses related to Karl Lagerfeld acquisition |
|
|
— |
|
|
— |
|
|
— |
|
|
0.04 |
|
|
0.04 |
Non-cash imputed interest |
|
|
0.04 |
|
|
0.03 |
|
|
0.03 |
|
|
0.03 |
|
|
0.13 |
Asset impairments, net of gain on lease terminations |
|
|
— |
|
|
— |
|
|
— |
|
|
0.03 |
|
|
0.03 |
Income tax impact of non-GAAP adjustments |
|
|
(0.01) |
|
|
(0.01) |
|
|
(0.01) |
|
|
(0.02) |
|
|
(0.05) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP diluted net income attributable to G-III
|
|
$ |
0.56 |
|
$ |
0.41 |
|
$ |
2.18 |
|
$ |
1.06 |
|
$ |
4.20 |
Non-GAAP diluted net income per share is a “non-GAAP financial measure” that excludes (i) expenses related to the Karl Lagerfeld transaction that include professional fees and foreign currency losses, (ii) non-cash imputed interest expense and (iii) asset impairments, net of gains on lease terminations. The income tax impact of non-GAAP adjustments is calculated using the effective tax rates for the respective periods. Management believes that this non-GAAP financial measure provides meaningful supplemental information regarding our performance by excluding items that are not indicative of our core business operating results. Management uses this non-GAAP financial measure to assess our performance on a comparative basis and believes that it is 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.
|
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FISCAL 2022 QUARTERLY RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA |
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(In thousands) |
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|
|
|
|
|
Three Months Ended |
|
Fiscal Year Ended |
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|
|
|
|
|
|
|
|||||
|
|
2021 |
|
2021 |
|
2021 |
|
2022 |
|
2022 |
|||||
|
|
(Unaudited) |
|||||||||||||
Net income attributable to |
|
$ |
26,321 |
|
$ |
19,168 |
|
$ |
106,674 |
|
$ |
48,430 |
|
$ |
200,593 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset impairments, net of gain on lease terminations |
|
|
— |
|
|
— |
|
|
— |
|
|
1,455 |
|
|
1,455 |
Depreciation and amortization |
|
|
7,044 |
|
|
7,098 |
|
|
7,024 |
|
|
6,460 |
|
|
27,626 |
Interest and financing charges, net |
|
|
12,004 |
|
|
12,574 |
|
|
12,354 |
|
|
12,734 |
|
|
49,666 |
Income tax expense |
|
|
10,259 |
|
|
9,235 |
|
|
40,198 |
|
|
11,183 |
|
|
70,875 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA, as defined |
|
$ |
55,628 |
|
$ |
48,075 |
|
$ |
166,250 |
|
$ |
80,262 |
|
$ |
350,215 |
Adjusted EBITDA is a “non-GAAP financial measure” which represents earnings before depreciation and amortization, interest and financing charges, net, asset impairments, net of gains on lease terminations and income tax expense. 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.
View source version on businesswire.com: https://www.businesswire.com/news/home/20220607005453/en/
Company Contact:
SVP of Investor Relations and Treasurer
(646) 473-5228
Investor Relations Contact:
(646) 277-1235
Source: