Should You Ditch the Retail Stores and Go with this Supplier?

Trying to figure out the winners and losers in fashion retail this holiday season could be almost as difficult as picking the right horses at the racetrack. Forget that game. Though it has its own mini chain, G-III Apparel Group (NASDAQ: GIII  ) mass designs, manufactures, and markets to a diverse base of customers which means that you, as the investor, do not have to pick individual winners. G-III Apparel is flourishing right alongside competitors such as PVH (NYSE: PVH  ) and Iconix Brand Group (NASDAQ: ICON  ) and might just be what your portfolio needs going into the new year.  (NASDAQ: ICON  )

(NASDAQ: ICON  ) G-III Apparel Group's results
G-III Apparel Group reported fiscal third-quarter results on Dec. 4. Net sales exploded 23% to a new record of $668.7 million. Adjusted net income popped 19% to $2.88 per share. The company saw success across all areas of its business.

CEO Morris Goldfarb credited G-III Apparel Group's success to its "wholesale business, great product design, compelling price and value, and a portfolio of strong brands" all blowing up both the top and bottom line. Even its retail stores saw "powerful comp sales" and it is going ahead with a "full-priced store test in time for the holiday season." Goldfarb pointed out that on top of G-III Apparel Group's years of consistent growth and opportunities, he sees greater opportunities than ever ahead.

G-III Apparel Group sees full-year adjusted earnings per share of between $3.50-$3.60 compared to $2.92 for last year.

Conference call
In the call, Goldfarb pointed out that same-store sales for its retail chain saw a double-digit increase despite going up against a double-digit increase last year. Earnings per share beat the company's own internal expectations. G-III Apparel Group's combination of designs and price points hit their mark and even the cold weather worked in the company's favor as this helped sell more coats. Its team sports business was "very strong," and G-III Apparel Group expects more growth next year. Its Calvin Klein Sportswear and Calvin Klein Performance categories were up almost 40% and over 55%, respectively. 

While its small retail chain only reported $55.1 million in sales, or 8.2% of the company's total sales, this was a 24% rise with sales mostly occurring at full retail price. This segment has a gross margin of over 50% compared to a companywide gross margin of only 34%. It seems in every channel and avenue where G-III Apparel Group sells, it sells amazingly well. Goldfarb stated, "We remain very much a growth company."

PVH is growing like a weed too
G-III Apparel Group isn't the only fashion supplier that's growing like a weed. PVH last reported results which show that all of its numbers are soaring. Revenue flew 38% to $2.259 billion although a large chunk of that was due to an acquisition. Earnings per share inched up to $2.37 compared to $2.27 last year.

CEO Emanuel Chirico stated that the results beat PVH's expectations despite the "difficult market environment." He believes the investments PVH has made in its brands will "fuel global expansion" next year, and he firmly believes PVH shareholders will see long-term growth and value.

Iconix Brand Group is no third wheel
Meanwhile, Iconix Brand Group is a smaller supplier than G-III Apparel Group and PVH, but its growth is making its own mark. Last quarter, Iconix Brand Group reported revenue that jumped 24% to $107.2 million. Adjusted earnings per share leaped 44% to $0.59. 

CEO Neil Cole credited the excellent performance with "the power of our business model and the strength of our portfolio." He expects further growth ahead for Iconix Brand Group in 2014. The company is so confident in its future that it has been aggressively buying back shares. Iconix Brand Group has bought back 32% of the shares outstanding over the last two years.

Foolish final thoughts
When it comes to a retail chains' success, a company has a lot of challenges to navigate including inventory, marketing, traffic, logistics, etc. Fools who want a broader way to invest in retail with fewer moving parts should take a look at G-III Apparel Group. The space is seeing vast success that almost looks too easy while its retail chain customers fight among each other. While there will be many winners and losers among the chains, suppliers such as G-III Apparel Group are the ultimate victors.

Two more anti-retail gems
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