Kontoor Brands recently reported a slight revenue decline of 1 per cent, totaling US $ 607 million for the second quarter, due to decreased international sales and ongoing inventory management efforts in the US.
The company, which owns the Wrangler and Lee brands, noted a 1 per cent drop in US revenue to US $ 496 million for the quarter. While direct-to-consumer sales grew, this was offset by a 1 per cent decline in wholesale revenue caused by reduced shipments as retailers managed their inventory levels more conservatively.
International revenue fell 6 per cent to US $ 111 million, driven by a 5 per cent drop in Europe and a significant 13 per cent decrease in Asia, which included a 26 per cent decline in wholesale. However, revenue from non-US Americas rose 2 per cent, fueled by increased wholesale growth.
Despite the revenue decline, the North Carolina-based company saw a 42 per cent increase in net income, reaching US $ 51.8 million for the quarter ending June 2024.
“We delivered second-quarter results that surpassed our expectations, driven by higher revenue, improved gross margin, and strong cash flow generation,” said Scott Baxter, President, CEO, and Chair of Kontoor Brands.
Looking ahead, Kontoor forecasts full-year revenue between US $ 2.57 billion and US $ 2.63 billion, reflecting a potential decrease of 1 per cent or an increase of 1 per cent compared to the previous year.
