G-III Apparel Group, LTD.

Good day, and thank you for standing by. Welcome to G3 Apparel Group first quarter fiscal 2025 earnings conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automatic message advising your hand is raised. Please note that today's conference is being recorded. I will now hand the conference over to your speaker host, Mr. Neil Mackman, Chief Financial Officer. Please go ahead, sir.

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 for diluted share, and adjusted EBITDA, which are all non-GAAP financial measures. We have provided reconciliations of these non-GAAP financial measures to gap 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.

Thank you, Neil, and thank you everyone for joining us. For our first quarter, we delivered net sales in line with our expectations and bottom line results well ahead of our guidance. These results are due to our unwavering commitment to disciplined brand building and operational excellence. Leveraging the design and merchandising strengths of our team, we achieved profitable sales growth by focusing on innovative product and assortments for our collections. Despite a dynamic and challenging consumer environment, we continue to see strong opportunities across our business. I'm proud of our best-in-class team who demonstrate resilience and agility every day as we advance our long-term strategic priorities. Before I review our first quarter results, let me provide some further details on this morning's announcement of our partnership with AWWG, a portfolio company primarily owned by M1 Group, Elle Catterton, and founder Carlos Ortega. AWWG is a global fashion group and premier platform for international brands, generating revenues of approximately $650 million. With this investment, we have an ownership interest of just over 12%. By year end, we expect to own close to 20%, and we'll look to expand ownership over time. With a strong European infrastructure and management team, AWWG has over 3,500 points of sales globally and a presence in 86 countries. They are the owner of Hackett, Pepe Jeans, and Fasunab, and manage the Iberian business for PVH. With our partnership, AWWG will also become the agent for Karl Lagerfeld, DKNY, and Donna Karan across Spain and Portugal. They bring an understanding of brand and product management, as well as operational excellence, aligning well with our strategic initiative to expand our European presence. Further, AWWG has a strong presence in India, one of the fastest growing fashion markets in the world. We believe that we can leverage them as our partner to expand DKNY and our other brands in that market. They benefit from our best-in-class operational capabilities in North America to secure a more meaningful foothold here for their brands. We will also hold one seat on AWWG's board to help advise the company and look forward to working with the leadership team to leverage our collective strengths. Our investment will expand both of our businesses. We expect this investment to be accretive from the start. Now let's review our first quarter 2025 financial results. Net sales for the quarter were $610 million compared to $607 million last year, and in line with our expectations. Gross margin rate expanded 130 basis points. The gross margin rate for our own brands is substantially higher than the PVH brands. Non-GAAP earnings per diluted share was 12 cents compared to 13 cents last year, and well ahead of our expectations. Our inventory remains in good position, down approximately 24% from last year's first quarter. As we announced this morning, we have upsized and extended the maturity of our revolving credit facility. We remain in a very strong financial position, ending the quarter with cash and availability of approximately $1 billion. Performance in the first quarter was driven by strong double-digit sales increases in DKNY and Karl Lagerfeld. Despite challenging weather, we're pleased with the spring selling season to date. We continue to meet the ever-changing needs of our customers by reinventing in our omnichannel capabilities, which is reflected in the strong performance of our wholesale business. Additionally, a North American retail business transformation is underway, and we're gaining traction with both Karl Lagerfeld Paris and DKNY stores, seeing strong double-digit comp increases. Growing brands is a core capability of ours, and we remain on track for net sales of our go-forward portfolio to approach approximately 70% of our total sales to the full fiscal 2025, as we continue to reduce the penetration of Calvin Klein and Tommy Hilfiger. Our best-in-class design and product development teams, field merchandisers, marketing, and overall investments in our brands are key differentiators for G3. These capabilities make us a partner of choice to retailers who have confidence in our ability to execute and deliver the right product at the right time. This is clearly evident as retailers are supporting our evolution by allocating their purchasing dollars to our go-forward businesses through significant door count and floor space expansion. This fall, we expect to add over 2,500 points of sale at our retail partners across better department stores as we expand categories and launch new brands. These efforts have directly translated into sales growth, which we expect to continue as we scale these businesses. As part of our focus on our own brands, we made our largest and most visible investments in marketing, which have already resulted in increased global interest and sales that have exceeded our expectations. Our brands, particularly Donna Karan, already have strong established brand equity. These supercharged campaigns serve to re-energize and create excitement amongst consumers. We're continuing the momentum and plan to invest meaningfully in marketing to further drive brand equity, accelerate sales, and increase resonance for long term. As previously mentioned, we relaunched Donna Karan with new designs along with an updated website and new fragrance collection, which has been extremely well-received season to date. On average, Donna Karan's AURs are significantly higher, sell-throughs are about 50% better, and retailer margins are double-digit higher than our other businesses, making it our most successful launch to date. Almost immediately, our retail partners have accelerated their investment in the brand, which expanded door counts and floor space. We launched about 200 doors and are expanding to over 500 doors in the fall. We're incredibly pleased to see Donna Karan exceeding our expectations. As mentioned, this relaunch was supported by a powerful marketing campaign with some of the biggest names in fashion, including Cindy Crawford, Linda Evangelista, Carolyn Murphy, Amber Valletta, and Karli Kloss, which brought the story of the brand's iconic legacy back to life with renewed relevance. The resulting 7.4 billion impressions equates to more than $15 million in earned marketing value and drove significant industry and consumer engagement. We're currently working on several initiatives to expand into complementary categories through licensing to better in-class partners. Our fragrance business with Interparfum is expected to grow by strong double digits supported by brand launches. This important licensing extension further supports visibility, attracting new and wider audiences to the world of Donna Karan. This is just the beginning. We see many opportunities ahead for this business globally. DKNY delivered strong double-digit increases this quarter. The brand's spring marketing featuring Kaya Gerber, who brought excitement and fresh energy to the brand and is driving more brand engagement through her social platforms and boosting DKNY's relevance and affinity amongst younger audiences globally. We further elevated visibility by re-establishing a long-term partnership with the New York Yankees. DKNY is now prominently featured on the right field billboard, enhancing the visibility at the stadium, as well as on broadcast TV and social media channels. In April, DKNY launched the Heart of New York capsule collection with a series of international pop-up shops and events, which we believe further reinforces our European expansion across key wholesale accounts. This capsule featured exclusive events and dedicated space in La Renicente, Harrods, and Zalando, as well as our DKNY freestanding boutiques. DKNY is well-established as a lifestyle brand, reaching a broader and younger audience across the globe, especially in Europe. We're creating energy around key activations, which help us deliver excitement and newness, driving brand awareness and engagement. In Asia, we're repositioning the DKNY brand in China. We're pleased with the double-digit growth in Korea this quarter and are evaluating other opportunities to accelerate our growth in the broader Asian markets. Karl Lagerfeld grew by almost 50% in North America this quarter, a truly incredible start to the year. We further built out the brand's lifestyle collection, launching the suit separates category and expanding doors for the dress category, resulting in approximately 500 new points of distribution for Karl Lagerfeld. The brand will now be prominently featured in a total of 1,200 points of distribution across the Better Department store space in just North America. Globally, our reach continues to grow through wholesale and entry into new markets and categories, like the recently launched Karl Lagerfeld jeans line. In collaboration with sustainability ambassador Amber Valletta, we introduced the latest collection for fall 2024, featuring bags created from Mirim, a cutting-edge sustainable leather alternative. This summer, we will capture some of the Olympic buzz by partnering with the new sport of three-on-three basketball, which is being included in this year's games. We will sponsor several playoff tournaments, launch a product collaboration, and host athletes in our Paris store. We're also revamping our global flagship store in London's Regent Street with a fresh concept just in time for September Fashion Week. And please be on the lookout for a mini-series releasing tomorrow on Hulu called Becoming Karl Lagerfeld. This series chronicles the early career of our iconic legendary designer, Karl Lagerfeld. We continue to leverage the power of the Karl Lagerfeld name to extend the lifestyle and appeal and international awareness of the brand while delivering incremental licensing revenue. Our launch of luxury villas in the heart of Dubai will be Karl Lagerfeld's inaugural real estate project in the Middle East. Additionally, we're capitalizing on licensing opportunities in key categories and will be launching an additional fragrance in July. Villebrecan remains focused on extending its lifestyle product categories, licensing opportunities, and expanding its beach club concept. During the quarter, Villebrecan opened a third store in Palma, Spain, and a beach club in Abu Dhabi. We continue to build upon our beach club experiences, which feature our shops and expect to drive business this summer. We're developing a new product for existing and new categories heading into the peak selling season. Since taking over the beach club in Cannes, we're pleased with the sales and profitability improvements to date. Currently, we have seven beach club projects in various stages of opening and are making progress toward our goal of opening 15 partner-operated beach clubs in exclusive global locations over the next three years. We've been able to quickly develop our new initiatives with Nautica, Halston, and Champion Out of Wear. The consumer response to our Nautica spring jeans collection has been positive and will be expanding to a broad range of additional categories over time. We're looking forward to our Halston lifestyle collection and Champion Out of Wear hitting retail floors this fall. Our brands, DKNY, Donna Karan, Karl Lagerfeld, and Vilbercan, have tremendous runway. In the last fiscal year, these brands, along with the rest of our go-forward portfolio, resulted in $1.8 billion in net sales, and together with our new launches, we see a $5 billion long-term net sales potential. Additionally, AWWG represents a sizable international opportunity from a revenue and infrastructure perspective. We have strong growth ahead between the organic acceleration of our brands and our new opportunities. In conclusion, we have a solid start to our fiscal year 2025, delivering non-GAAP earnings that beat our expectations. We're controlling the controllables, while utilizing a data-driven approach to strategically invest in our brands to drive profitability and long-term brand health. Looking ahead, we continue to believe that the consumer environment will remain under pressure and remain cautiously optimistic. We're reaffirming our top line while raising bottom line guidance and now expect earnings per diluted share to be in the range of $3.58 to $3.68. Our proven track record of success and our strong balance sheet give us ample flexibility to invest in our business. We're making good progress on many of our objectives, including strong results delivered through outside performance of our own brands, DKNY, Karl Lagerfeld, and the successful relaunch of Donna Karans. our announced partnership with AWWG, which accelerates our international expansion, our reduced reliance on the PVH brands, and the turnaround plans for the retail segment. We have significant long-term opportunities to expand our business, and I'm confident that this is just the beginning. I'll now pass the call to Neil for a discussion of our first quarter as well as our fiscal 2025 outlet.