Perry Ellis International, Inc. has reported its results for the fourth quarter and the fiscal year ended January 30, 2016.
Total revenue for the fourth quarter of fiscal 2016 was $214 million, a 1.5 percent decrease compared to $218 million reported in the fourth quarter of fiscal 2015. As previously disclosed, revenues were impacted by 1 percent by foreign exchange as well as from the reduction of revenues associated with exited brands, including C&C California, as well as a migration of two non-core brands to licensed arrangements during Fiscal 2017. Excluding these effects, revenue increased 3 percent for the fourth quarter.
During the fourth quarter of fiscal 2016, overall gross margins expanded 290 bps to 37.2 percent compared to the fourth quarter of the prior year. Margin expansion was generated in the Company’s domestic menswear business driven by reduced markdowns as a result of strong consumer response to our product presentations and stronger merchandising margins. On an adjusted basis, fiscal 2016 fourth quarter earnings per diluted share increased over 390 percent to $0.35 as compared to adjusted earnings per diluted share of $0.07 in the fourth quarter of fiscal 2015.
Fiscal 2016 revenues were $900 million as compared to $890 million reported in fiscal 2015. Revenue growth resulted from growth in core brands. Excluding the impact of exited brands and foreign exchange, revenues increased by 4.6 percent. Adjusted earnings per diluted share for fiscal 2016 were $1.81 compared to adjusted earnings per diluted share of $0.56 in fiscal 2015.
Year-end cash and investments totaled $41.7 million and $133 million of long-term debt. This compares to $63.5 million at the end of the prior year and $172 million of long-term debt. The Company redeemed $100 million of its senior subordinated notes in May 2016, which generated interest savings of approximately $4.5 million. Inventory turnover improved throughout the year and continues to be key focus for the company.
“During the quarter and throughout the year we focused on our strategic plan to support and advance our core global brands, to expand gross margin and to generate cost efficiencies,” said Oscar Feldenkreis, president and chief operating officer. “The successful implementation of our strategy culminated in our adjusted earnings per share increasing by more than 225% in the fiscal 2016 year. During the year, we recorded growth in core brands, in licensing, and our international business, underscoring the global appeal of our brands and supporting our margin expansion. As previously discussed, while fiscal 2016 presented the industry with challenges driven by a soft consumer spending environment and a stronger US dollar, we adapted to meet the changing landscape and ended the year positioned to generate higher margin revenues in the year ahead. I firmly believe that our focus on building our core brands, discipline and agility along with our powerful brands and proven growth initiatives will enable Perry Ellis International to deliver continued long-term profitable growth and value creation for our shareholders.”