G-III Apparel Group, Ltd. (NASDAQ:GIII) Q2 2024 Earnings Call Transcript September 7, 2023 8:30 AM ET

Company Participants

Neal Nackman - CFO

Morris Goldfarb - Chairman and CEO

Conference Call Participants

Will Gaertner - Wells Fargo

Mauricio Serna - UBS

Paul Kearney - Barclays

Dana Telsey - Telsey Advisory Group

Operator

Good day, and thank you for standing by. Welcome to the G-III Apparel Group Second Quarter Fiscal 2024 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to turn the conference over to Neal Nackman, Chief Financial Officer. Please go ahead.

Neal Nackman

Good morning, and thank you for joining us. Before we begin, I would like to remind participants that certain statements made on today's call and in the Q&A session may constitute forward-looking statements within the meaning of the Federal Securities laws. Forward-looking statements are not guarantees and actual results may differ materially from those expressed or implied in forward-looking statements. Important factors that could cause actual results of operations or the financial condition of the company to differ are discussed in the documents filed by the company with the SEC. The company undertakes no duty to update any forward-looking statements.

In addition, during the call, we will refer to non-GAAP net income, non-GAAP net income per diluted share, and adjusted EBITDA, which are all non-GAAP financial measures. We have provided reconciliations of these non-GAAP financial measures to GAAP measures in our press release, which is also available on our website.

I will now turn the call over to our Chairman and Chief Executive Officer, Morris Goldfarb.

Morris Goldfarb

Thank you, Neal, and thank you everyone for joining us. We registered another strong quarter well exceeding our top and bottom-line guidance. The second quarter caps off a strong first half for G-III, demonstrating our ability to navigate what remains a dynamic environment. This gives us confidence as we look ahead to the balance of the year and accordingly, we’ve raised our full year guidance.

As a global leader in fashion, we remain focused on strong execution of our business while pursuing our many opportunities for growth. For the second quarter of fiscal 2024, net sales were $660 million, an increase of 9% from $605 million last year, well above our guidance by approximately 10% or $65 million. Non-GAAP net income per diluted share was $0.40, exceeding our guidance by $0.40. Similar to what we experienced in the first quarter, second quarter gross margins were better than last year's second quarter. Our freight costs have moderated and we're now beginning to anniversary last year's significant one-time logistics costs, which primarily occurred in the third quarter.