Before we go into deep dive of the Q2 results, here is the snapshot of Q2 earnings.

Revenue Distribution – Brands

Looking at the brand-wise revenue distribution, Tommy Hilfiger is leading the revenue chart with USD 803.7 million accounting for 50.4% of total revenue share. Calvin Klein with USD 590.5 million is the second in the revenue chart accounting for 37% of total revenue.
Comparing the same period from the previous year, both brands Tommy Hilfiger and Calvin Klein have registered a massive fall of 28% and 32 % respectively. Overall, the total revenue contracted by 33% which amounted to a total revenue loss of $783 million.

Revenue Distribution – Regions

Calvin Klein

Analysis of the regional distribution of revenue of Calvin Klein shows that revenue from the North America region saw a decline of more than 50% during Q2 2020, revenue fell from $408 million to a mere $199.7 million. Internationally, CK revenue witnessed a fall of 16%. Whereas in 2019 , the revenue from North American and International business was quite close , this time the international revenue is about double that of North American showing clearly that CK suffered more in US.

Tommy Hilfiger

The highest-grossing brand of PVH- Tommy Hilfiger has a similar story, its North American operation has also reported a fall of 51% in its revenue during Q2,2020 however internationally a decline of 14% was reported.

Revenue Distribution – Channels

Whole Sale Channel is beating the retail channel in terms of revenue distribution of Heritage Brands by big margins. Where Retail Channel contributed USD 34.4 Million, the wholesale channel of Heritage Brand contributed USD 152 million during Q2,2020 however both channels were hugely affected and down by 51% during this quarter ended on August 2, 2020.

The Company anticipates its second-half revenue and earnings will continue to be negatively impacted by the COVID-19 pandemic; while the Company expects revenue in the second half to decline approximately 25% compared to the prior-year period, it cannot provide more detailed guidance at this time due to the uncertainty related to the duration and severity of the pandemic.

The group , based in Hong Kong , has production facilities in China, Vietnam, Cambodia, Bangladesh and Sri Lanka . Their products are categorized in five main categories ie Lifestyle Wear, Denim, Intimate segment, Sweaters and Sportswear & Outerwear. We will analyze below their performance for 2014-2016 (their latest figures will be analyzed in another report).

1. Revenue By Product Category

The revenue from lifestyle segment was about 785 million usd with 46% of the total revenue in 2014 which saw a decrease to about 748 million USD in 2016 with about 42% of the total revenue in 2016.

The second largest revenue generator for Crystal International group ltd was denim’s segment , the revenue was about 332 million usd with 19.5% of the total revenue for 2014 which increased to 484 million usd with 27.5% of the total revenue in 2016. This was indeed a great increase of more than 40% in 2 years !

The third largest revenue generator was Intimate segment with revenue of about 245 million usd with 14% of the total revenue for 2014 which in 2016 increased to about 22% to about 294 million usd with 16.7% of the total revenue.

The fourth and fifth largest revenue generator were Sweater and Sportswear& Outwerwear segment with revenue of about 272 million usd and 223 million USD in 2016 respectively.

2. Sales Volume By Product Category

The Sales by category by Crystal International Group Ltd saw that the lifestyle segment had the highest sale of about 177 million pcs with an average price of USD4.2 in the year 2016.

The denim segment had the second largest sales volume of about 40 million pcs with an average selling price of USD8.4 in the year 2014 which increased most rapidly to about 56 million pieces – a growth of about 40% in 2 years ! This was the highest growing segment for Crystal.

The Intimate segment had the third largest sales volume of about 73 millin pcs with an average selling price of USD3.3 in 2014 which saw an increase of about 12% to 82.02 million pcs with the average selling price of USD2.9 in 2015 which further increased about 10% to 90.11 million pcs with an average selling price of 3.3 in 2016.

The Sweater segment had the fourth largest sales volume of 25.04 million pcs with an average selling price of 8.9 in 2016.

3. Revenue By Geographic Regions

The table below shows the revenue by geographic region , the largest part of revenue was from Asia Pacific for the three consecutive year from 2014 to 2016 with the revenue of 609 million usd in 2014 which increased to 695 million usd with 34.8% of the total revenue in 2016. This shows that the company is well entrenched in all East Asian markets including China which gives it its whopping 600 million usd sales in this region alone.

U.S contributes the second largest revenue by region – 530 million usd with 31.2% of the total revenue in 2014 which saw an increase of about 11% to 586.06 million usd with 34.7% of the total revenue in 2014, the revenue increased further about 5% to 614.07 million usd with 34.8% of the total revenue in 2016.

Europe contributes the third largest revenue by region with 520 million usd and 30.6% of the total revenue in 2014 which decreased to about 11% to 392 million usd with 22.4% of the total revenue in 2016.

There is no doubt that Crystal is a very important global apparel group given its size . Being the largest company producing denim apparel makes it very special for the industry . The company expects to keep on growing rapidly over the next few years and it is poised to achieve greater heights. We will further analyse their growth and performance in another report.

1. Revenues For The Fourth Quarter

The revenues for the different segments for the fourth quarter from 2016 to fourth quarter 2017 saw that the total revenues changed positively by 20% . The revenues in fourth quarter for Outdoor & Actions Sports increased by 16% from about $2.16 billion in 2016 to $2.50 billion in fourth quarter 2017. The revenues for Jeanswear did not increase much and showed only a growth of about 2%. However, Image wear segment saw a substantial growth in revenue of a huge 176% in fourth quarter 2017 to reach a turnover of about $406 million usd.

Outdoor & Action sports is now the mainstay of VF with about 69% of total turnover while Jeanswear is lagging at 19% only and the rest is divided among different segments.

2. Revenue For Full Year

The revenue in different segments for the full year of 2017 show that major action is happening in Imagewear only which has shown 50% growth. Jeanswear is where mid priced retailers like VF are struggling and not able to compete with fast fashion retailers like H&M. The company has shown negative growth of 3% for Jeanswear for the whole year while Outdoor and Action Sports segment has shown a healthy growth of 8% to reach a total turnover of about 11.8 billion USD for the whole year . The overall top line growth has been 7% in 2017.

The pie – chart saw that the revenues for the full year of 2017 for the different segments like Outdoor & Action Sports was 70% of the total revenue , Similarly the revenues for Jeanswear, Imagewear and Other were 22%, 7% and 1% respectively for the full year of 2017.

3. Profit/Loss

The pie – chart saw that the profit for the fourth quarter of 2017 like Outdoor & Action Sports was 78% of the total revenue , similarly the Jeanswear, Imagewear was 16% and 6% of the total revenue. This again clearly shows that VF is now more of a Outdoor & Action Sports company than a Jeans company.

4.Profit/Loss

The total profit , however, did not increase in the same volume as that of fourth quarter. The profit increased in total by 4% only . These profits were dragged down by the Jeanswear segment which reduced its profit by 14% . The pie- chart saw that the profit for different segment in 2017 like Outdoor & Action Sports was 22% of the total revenue , similarly for Jeanswear, Imagewear was 72% and 6% of the total revenue of 2017.

5.Geographic Revenue Growth

The Percentage change in revenue for fourth quarter of 2017 from the same period in last year , saw that the revenue growth for U.S increased by 15% , Similarly the revenue growth in EMEA, APAC, China , Americas and Internatianal increased by 33%, 17%, 23%, 35%, respectively for the fourth quarter of 2017. However the geographic revenue growth for the year 2017 in U.S was 4% , similarly for APAC, China, Americas(Non- US) and Internationally was 15% , 6% ,10%, 13% ,12% respectively.It is also to be seen that the maximum revenue growth was in EMEA and Americas(non U.S) for both fourth quarter and full year of 2017.

6. Channel Revenue Growth

The channel revenue growth for Wholesale Channel and Direct – to – consumer channel for fourth quarter of 2017 increased about 19% and 22% from the last year of the same period and that of the full year was 17% and 20% respectively.