Kontoor Brands Signals It’s Rounding A Corner
Kontoor Brands is picking up the pace during the pandemic.
The denim company, whose brands include Wrangler and Lee, said Tuesday that revenue for the fourth quarter of 2020 was $661 million, a one percent increase, while adjusted earnings per share for the quarter were $1.23, a 27 percent increase.
In the three months ended in December, the company reported a climb in net income to $43 million, up 50 percent from the same period in 2019. The company’s revenues were pulled up by growth in both the Wrangler and Lee brands, among other things, Kontoor said. Wrangler’s revenue overall for the quarter was $448 million, a 7 percent increase from last year, growth stemming in part from improving revenues in the U.S., where sales rose 8 percent.
The company continues to promote its Wrangler brand’s collections. On Monday, Wrangler said it had brought on model Georgia May Jagger, whose parents are Rolling Stones frontman Mick Jagger and model Jerry Hall, to represent its Women’s Heritage Collection that launched in the fall.
The revenues for the Lee brand were $204 million for the quarter, an uptick of 1 percent from last year.
“Revenue increases were primarily driven by strength in digital, including own.com and digital wholesale, as well as improved performance across the Wrangler U.S. wholesale business and accelerating trends in International markets,” the company said.
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For 2020 overall, the company’s revenues dropped 18 percent to $2.1 billion, marking the impact of temporary lockdowns and store closures early in 2020 that a number of states had implemented to help prevent the spread of COVID-19. But the lockdowns were short-lived, and the pandemic is still ongoing, with a death toll of more than 514,660 in the U.S. according to the Johns Hopkins University tracker.
“We finished 2020 with great momentum, a testament to our teams’ unwavering focus on execution throughout this unprecedented year,” the company’s chief executive officer Scott Baxter said in a statement Tuesday.
“Our strong fourth quarter performance is also a result of the strategic measures we’ve taken over the last two years, allowing us to not only navigate near-term challenges, but also position the company for success in 2021 and beyond,” he added. “Focused investments in brand-enhancing initiatives, technology and talent are setting the stage for an exciting next phase of our journey in which we expect accelerating long-term sustainable growth.”
Despite its sunny projections for 2021, including a revenue increase in the “low double-digit range” from 2020 and estimated adjusted earnings per share in the $3.50 to $3.60 range, the company said it would continue to account for the pandemic persisting through the year.
“The company continues to take the necessary, proactive steps to accommodate a prolonged COVID-19 operating environment,” Kontoor said.
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