Wrangler parent shares slip after revenue miss
Kontoor Brands Inc. stock fell 6.7% in Thursday trading after the denim company reported first-quarter revenue that missed expectations. Net losses totaled $2.7 million, or 5 cents per share, after net income of $15.4 million, or 27 cents per share, last year. Adjusted EPS was 27 cents, ahead of the FactSet consensus for 22 cents. Revenue totaled $504.5 million, down from $648.3 million and below the $522.0 million FactSet outlook. Kontoor's portfolio of brands includes Wrangler, Lee and Rock & Republic. The company previously withdrew its 2020 guidance. Kontoor ended the quarter with $479 million in cash and equivalents and $1.4 billion in long-term debt. The company drew down its $475 million credit facility, has suspended its dividend, reduced management salaries and taken other financial measures in response to the COVID-19 outbreak. Kontoor says 85% of its business is done through the wholesale channel, with a material decline due to widespread store closures. Kontoor stock is down 58% for the year to date while the S&P 500 index is down 10.6%.
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