Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Apr. 30, 2023 | Jun. 02, 2023 | |
Document And Entity Information Abstract | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Apr. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 0-18183 | |
Entity Registrant Name | G III APPAREL GROUP LTD /DE/ | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 41-1590959 | |
Entity Address, Address Line One | 512 Seventh Avenue | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10018 | |
City Area Code | 212 | |
Local Phone Number | 403-0500 | |
Title of 12(b) Security | Common Stock | |
Trading Symbol | GIII | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock Shares Outstanding | 45,593,524 | |
Entity Central Index Key | 0000821002 | |
Current Fiscal Year End Date | --01-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Apr. 30, 2023 | Jan. 31, 2023 | Apr. 30, 2022 |
Current assets | |||
Cash and cash equivalents | $ 289,729 | $ 191,652 | $ 438,411 |
Accounts receivable, net of allowance for doubtful accounts of $18.8 million, $16.9 million and $18.3 million, respectively | 494,601 | 674,963 | 573,613 |
Inventories | 630,308 | 709,345 | 550,059 |
Prepaid income taxes | 7,692 | 5,886 | 1,071 |
Prepaid expenses and other current assets | 69,432 | 70,654 | 53,425 |
Total current assets | 1,491,762 | 1,652,500 | 1,616,579 |
Investments in unconsolidated affiliates | 27,585 | 24,467 | 89,827 |
Property and equipment, net | 53,157 | 53,742 | 47,274 |
Operating lease assets | 237,056 | 239,665 | 164,607 |
Other assets, net | 52,183 | 52,644 | 54,132 |
Other intangibles, net | 34,131 | 34,842 | 30,512 |
Deferred income tax assets, net | 26,389 | 26,389 | 1,647 |
Trademarks | 632,220 | 628,156 | 451,967 |
Goodwill | 261,727 | ||
Total assets | 2,554,483 | 2,712,405 | 2,718,272 |
Current liabilities | |||
Current portion of notes payable | 139,418 | 135,518 | 4,554 |
Accounts payable | 140,064 | 169,508 | 215,489 |
Accrued expenses | 99,092 | 115,586 | 94,359 |
Customer refund liabilities | 69,408 | 89,760 | 78,052 |
Current operating lease liabilities | 51,024 | 52,917 | 41,112 |
Income tax payable | 8,234 | 14,875 | 17,060 |
Other current liabilities | 863 | 905 | 1,358 |
Total current liabilities | 508,103 | 579,069 | 451,984 |
Notes payable, net of discount and unamortized issuance costs | 403,586 | 483,840 | 516,828 |
Deferred income tax liabilities, net | 45,561 | 44,783 | 38,021 |
Noncurrent operating lease liabilities | 202,406 | 204,974 | 139,686 |
Other non-current liabilities | 15,325 | 15,141 | 12,998 |
Total liabilities | 1,174,981 | 1,327,807 | 1,159,517 |
Redeemable noncontrolling interests | (945) | (850) | 463 |
Stockholders' Equity | |||
Preferred stock; 1,000 shares authorized; no shares issued and outstanding | |||
Common stock - $0.01 par value; 120,000 shares authorized; 49,396, 49,396 and 49,396 shares issued, respectively | 264 | 264 | 264 |
Additional paid-in capital | 472,474 | 468,712 | 460,999 |
Accumulated other comprehensive loss | (6,936) | (11,653) | (18,657) |
Retained earnings | 987,180 | 983,944 | 1,147,639 |
Common stock held in treasury, at cost - 3,802, 1,209 and 2,680 shares, respectively | (72,535) | (55,819) | (31,953) |
Total stockholders' equity | 1,380,447 | 1,385,448 | 1,558,292 |
Total liabilities, redeemable noncontrolling interests and stockholders' equity | $ 2,554,483 | $ 2,712,405 | $ 2,718,272 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Millions | Apr. 30, 2023 | Jan. 31, 2023 | Apr. 30, 2022 |
CONSOLIDATED BALANCE SHEETS | |||
Allowance for doubtful accounts | $ 18.8 | $ 18.3 | $ 16.9 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 120,000,000 | 120,000,000 | 120,000,000 |
Common stock, shares issued | 49,396,000 | 49,396,000 | 49,396,000 |
Treasury stock, shares | 3,802,000 | 2,680,000 | 1,209,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) | ||
Net sales | $ 606,589 | $ 688,757 |
Cost of goods sold | 356,788 | 442,718 |
Gross profit | 249,801 | 246,039 |
Selling, general and administrative expenses | 227,961 | 185,407 |
Depreciation and amortization | 6,576 | 6,095 |
Operating profit (loss) | 15,264 | 54,537 |
Other income | 973 | (2,708) |
Interest and financing charges, net | (12,151) | (12,203) |
Income (loss) before income taxes | 4,086 | 39,626 |
Income tax expense (benefit) | 945 | 9,000 |
Net income (loss) | 3,141 | 30,626 |
Less: Loss attributable to noncontrolling interests | (95) | (8) |
Net income (loss) attributable to G-III Apparel Group, Ltd. | $ 3,236 | $ 30,634 |
Basic: | ||
Net income (loss) per common share | $ 0.07 | $ 0.64 |
Weighted average number of shares outstanding (in shares) | 46,286 | 48,016 |
Diluted: | ||
Net income (loss) per common share | $ 0.07 | $ 0.62 |
Weighted average number of shares outstanding (in shares) | 47,442 | 49,108 |
Other comprehensive loss: | ||
Foreign currency translation adjustments | $ 4,715 | $ (4,130) |
Other comprehensive loss | 4,715 | (4,130) |
Comprehensive income (loss) | 7,856 | 26,496 |
Comprehensive loss attributable to noncontrolling interests: | ||
Net loss | (95) | (8) |
Foreign currency translation adjustments | 2 | 2 |
Comprehensive loss attributable to noncontrolling interests | (93) | (6) |
Comprehensive income (loss) attributable to G-III Apparel Group, Ltd. | $ 7,763 | $ 26,490 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Retained Earnings | Treasury Stock, Common [Member] | Total |
Balance at beginning of period at Jan. 31, 2022 | $ 264 | $ 456,329 | $ (14,529) | $ 1,117,005 | $ 1,519,912 | |
Balance at beginning of period, treasury at Jan. 31, 2022 | $ (39,157) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Equity awards exercised/vested, net | (7,204) | 7,204 | ||||
Share-based compensation expense | 20,549 | 20,549 | ||||
Taxes paid for net share settlements | (8,675) | (8,675) | ||||
Other comprehensive gain (loss), net | (4,128) | (4,128) | ||||
Net income (loss) attributable to G-III Apparel Group, Ltd. | 30,634 | 30,634 | ||||
Balance at end of period, treasury at Apr. 30, 2022 | (31,953) | (31,953) | ||||
Balance at end of period at Apr. 30, 2022 | 264 | 460,999 | (18,657) | 1,147,639 | 1,558,292 | |
Balance at beginning of period at Jan. 31, 2023 | 264 | 468,712 | (11,653) | 983,944 | 1,385,448 | |
Balance at beginning of period, treasury at Jan. 31, 2023 | (55,819) | (55,819) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Equity awards exercised/vested, net | (53) | 53 | ||||
Share-based compensation expense | 3,837 | 3,837 | ||||
Taxes paid for net share settlements | (22) | (22) | ||||
Other comprehensive gain (loss), net | 4,717 | 4,717 | ||||
Repurchases of common stock | (16,769) | (16,769) | ||||
Net income (loss) attributable to G-III Apparel Group, Ltd. | 3,236 | 3,236 | ||||
Balance at end of period, treasury at Apr. 30, 2023 | $ (72,535) | (72,535) | ||||
Balance at end of period at Apr. 30, 2023 | $ 264 | $ 472,474 | $ (6,936) | $ 987,180 | $ 1,380,447 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | |
Cash flows from operating activities | ||
Net income (loss) attributable to G-III Apparel Group, Ltd. | $ 3,236 | $ 30,634 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities, net of assets and liabilities acquired: | ||
Depreciation and amortization | 6,576 | 6,095 |
Loss on disposal of fixed assets | 393 | 24 |
Non-cash operating lease costs | 14,902 | 11,852 |
Equity (gain)/loss in unconsolidated affiliates | 482 | (676) |
Change in fair value of equity investment | (1,009) | 1,126 |
Share-based compensation | 3,837 | 20,549 |
Deferred financing charges and debt discount amortization | 2,640 | 2,494 |
Deferred income taxes | 778 | 71 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | 180,362 | 31,898 |
Inventories | 79,037 | (37,904) |
Income taxes, net | (8,448) | 20,496 |
Prepaid expenses and other current assets | 2,422 | (9) |
Other assets, net | 448 | 62 |
Customer refund liabilities | (20,352) | (8,736) |
Operating lease liabilities | (16,724) | (11,675) |
Accounts payable, accrued expenses and other liabilities | (46,749) | (55,130) |
Net cash provided by (used in) operating activities | 201,831 | 11,171 |
Cash flows from investing activities | ||
Operating lease assets initial direct costs | (52) | |
Investment in e-commerce retailer | (25,000) | |
Investment in equity securities | (3,600) | |
Capital expenditures | (4,978) | (4,334) |
Net cash used in investing activities | (8,630) | (29,334) |
Cash flows from financing activities | ||
Repayment of borrowings - revolving credit facility | (85,400) | |
Proceeds from borrowings - revolving credit facility | 5,313 | |
Repayment of borrowings - foreign facilities | (36,073) | (356) |
Proceeds from borrowings - foreign facilities | 37,199 | 287 |
Purchase of treasury shares | (16,769) | |
Taxes paid for net share settlements | (22) | (8,675) |
Net cash provided by (used in) financing activities | (95,752) | (8,744) |
Foreign currency translation adjustments | 628 | (666) |
Net increase (decrease) in cash and cash equivalents | 98,077 | (27,573) |
Cash and cash equivalents at beginning of year | 191,652 | 465,984 |
Cash payments: | ||
Interest, net | 16,781 | 17,236 |
Income tax payments, net | $ 9,176 | $ (11,694) |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Apr. 30, 2023 | |
SIGNIFICANT ACCOUNTING POLICIES [Abstract] | |
Basis of Presentation | NOTE 1 – BASIS OF PRESENTATION As used in these financial statements, the term “Company” or “G-III” refers to G-III Apparel Group, Ltd. and its subsidiaries. The Company designs, sources and markets an extensive range of apparel, including outerwear, dresses, sportswear, swimwear, women’s suits and women’s performance wear, as well as women’s handbags, footwear, small leather goods, cold weather accessories and luggage. The Company also operates retail stores and licenses its proprietary brands under several product categories. The Company consolidates the accounts of its wholly-owned and majority-owned subsidiaries. Fabco Holding B.V. (“Fabco”) is a Dutch joint venture limited liability company that is 75% owned by the Company and is treated as a consolidated majority-owned subsidiary. In October 2021, the Company purchased Sonia Rykiel, a wholly-owned operating subsidiary. The results of Sonia Rykiel are included in the Company’s consolidated financial statements beginning in the fourth quarter of fiscal 2022. Karl Lagerfeld Holding B.V. (“KLH”) is a Dutch limited liability company that was 19% owned by the Company through May 30, 2022 and was accounted for during that time using the equity method of accounting. Effective May 31, 2022, the Company acquired the remaining 81% interest in KLH that it did not previously own and, as a result, KLH began being treated as a consolidated wholly-owned subsidiary. KL North America B.V. (“KLNA”) is a Dutch joint venture limited liability company that was 49% owned by the Company and 51% indirectly owned by KLH through May 30, 2022 and was accounted for during that time using the equity method of accounting. Effective May 31, 2022, KLNA became an indirect wholly-owned subsidiary of the Company as a result of the Company’s acquisition of the remaining 81% interest in KLH it did not previously own. All material intercompany balances and transactions have been eliminated. The results of KLH are included in the Company’s consolidated financial statements beginning May 31, 2022. Vilebrequin International SA (“Vilebrequin”), a Swiss corporation that is wholly-owned by the Company, KLH, Fabco and Sonia Rykiel, report results on a calendar year basis rather than on the January 31 fiscal year basis used by the Company. Accordingly, the results of Vilebrequin, KLH, Fabco and Sonia Rykiel are included in the financial statements for the quarter ended or ending closest to the Company’s fiscal quarter end. For example, with respect to the Company’s results for the three-month period ended April 30, 2023, the results of Vilebrequin, Fabco, KLH and Sonia Rykiel are included for the three-month period ended March 31, 2023. For the year ended December 31, 2022, the results of KLH, which includes KLNA, are included for the period from June 1, 2022 through December 31, 2022. The results of the Company’s previous 49% ownership interest in KLNA and 19% ownership interest in KLH are included for the period from February 1, 2022 through May 30, 2022. The Company’s retail operations segment reports on a 52/53 week fiscal year. The Company’s three-month periods ended April 30, 2023 and 2022 were each 13-week periods for the retail operations segment. For fiscal 2024 and 2023, the three-month periods for the retail operations segment ended on April 29, 2023 and April 30, 2022, respectively. The results for the three months ended April 30, 2023 are not necessarily indicative of the results expected for the entire fiscal year, given the seasonal nature of the Company’s business. The accompanying financial statements included herein are unaudited. All adjustments (consisting of only normal recurring adjustments) necessary for a fair presentation of the financial position, results of operations and cash flows for the interim period presented have been reflected. The accompanying financial statements should be read in conjunction with the financial statements and notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2023 filed with the Securities and Exchange Commission (the “SEC”). Assets and liabilities of the Company’s foreign operations, where the functional currency is not the U.S. dollar (reporting currency), are translated from the foreign currency into U.S. dollars at period-end rates, while income and expenses are translated at the weighted-average exchange rates for the period. The related translation adjustments are reflected as a foreign currency translation adjustment in accumulated other comprehensive loss within stockholders’ equity. |
ALLOWANCE FOR DOUBTFUL ACCOUNTS
ALLOWANCE FOR DOUBTFUL ACCOUNTS | 3 Months Ended |
Apr. 30, 2023 | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | NOTE 2 – ALLOWANCE FOR DOUBTFUL ACCOUNTS The Company’s financial instruments consist of trade receivables arising from revenue transactions in the ordinary course of business. The Company considers its trade receivables to consist of two portfolio segments: wholesale and retail trade receivables. Wholesale trade receivables result from credit the Company has extended to its wholesale customers based on pre-defined criteria and are generally due within 30 to 60 days. Retail trade receivables primarily relate to amounts due from third-party credit card processors for the settlement of debit and credit card transactions and are typically collected within 3 to 5 days. The Company’s accounts receivable and allowance for doubtful accounts as of April 30, 2023, April 30, 2022 and January 31, 2023 were: April 30, 2023 Wholesale Retail Total (In thousands) Accounts receivable, gross $ 512,315 $ 1,118 $ 513,433 Allowance for doubtful accounts (18,769) (63) (18,832) Accounts receivable, net $ 493,546 $ 1,055 $ 494,601 April 30, 2022 Wholesale Retail Total (In thousands) Accounts receivable, gross $ 589,233 $ 1,319 $ 590,552 Allowance for doubtful accounts (16,858) (81) (16,939) Accounts receivable, net $ 572,375 $ 1,238 $ 573,613 January 31, 2023 Wholesale Retail Total (In thousands) Accounts receivable, gross $ 692,033 $ 1,227 $ 693,260 Allowance for doubtful accounts (18,237) (60) (18,297) Accounts receivable, net $ 673,796 $ 1,167 $ 674,963 The allowance for doubtful accounts for wholesale trade receivables is estimated based on several factors. In circumstances where the Company is aware of a specific customer’s inability to meet its financial obligations (such as in the case of bankruptcy filings (including potential bankruptcy filings), extensive delay in payment or substantial downgrading by credit rating agencies), a specific reserve for bad debt is recorded against amounts due from that customer to reduce the net recognized receivable to the amount reasonably expected to be collected. For all other wholesale customers, an allowance for doubtful accounts is determined through analysis of the aging of accounts receivable at the end of the reporting period for financial statements, assessments of collectability based on historical trends and an evaluation of the impact of economic conditions. The Company considers both current and forecasted future economic conditions in determining the adequacy of its allowance for doubtful accounts. The allowance for doubtful accounts for retail trade receivables is estimated at the credit card chargeback rate applied to the previous 90 days of credit card sales. In addition, the Company considers both current and forecasted future economic conditions in determining the adequacy of its allowance for doubtful accounts. The Company had the following activity in its allowance for credit losses: Wholesale Retail Total (In thousands) Balance as of January 31, 2023 $ (18,237) $ (60) $ (18,297) Provision for credit losses, net (532) (3) (535) Accounts written off as uncollectible — — — Balance as of April 30, 2023 $ (18,769) $ (63) $ (18,832) Balance as of January 31, 2022 $ (17,307) $ (84) $ (17,391) Provision for credit losses, net 411 3 414 Accounts written off as uncollectible 38 — 38 Balance as of April 30, 2022 $ (16,858) $ (81) $ (16,939) Balance as of January 31, 2022 $ (17,307) $ (84) $ (17,391) Provision for credit losses, net (1,002) 24 (978) Accounts written off as uncollectible 72 — 72 Balance as of January 31, 2023 $ (18,237) $ (60) $ (18,297) |
INVENTORIES
INVENTORIES | 3 Months Ended |
Apr. 30, 2023 | |
INVENTORIES [Abstract] | |
INVENTORIES | NOTE 3 – INVENTORIES Wholesale inventories, which comprise a significant portion of the Company’s inventory, are stated at the lower of cost (determined by the first-in, first-out method) or net realizable value. Retail and Vilebrequin inventories are stated at the lower of cost (determined by the weighted average method) or net realizable value. Substantially all of the Company’s inventories consist of finished goods. The inventory return asset, which consists of the amount of goods that are anticipated to be returned by customers, was $12.9 million, $16.4 million and $19.2 million as of April 30, 2023, April 30, 2022 and January 31, 2023, respectively. The inventory return asset is recorded within prepaid expenses and other current assets on the condensed consolidated balance sheets. Inventory held on consignment by the Company’s customers totaled $7.6 million, $5.9 million and $6.6 million at April 30, 2023, April 30, 2022 and January 31, 2023, respectively. Consignment inventory is held by the Company’s customers. The Company reflects this inventory on its condensed consolidated balance sheets. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Apr. 30, 2023 | |
Fair Value of Financial Instruments [Abstract] | |
Fair Value of Financial Instruments | NOTE 4 – FAIR VALUE OF FINANCIAL INSTRUMENTS Generally Accepted Accounting Principles establish a three-level valuation hierarchy for disclosure of fair value measurements. The determination of the applicable level within the hierarchy for a particular asset or liability depends on the inputs used in its valuation as of the measurement date, notably the extent to which the inputs are market-based (observable) or internally-derived (unobservable). A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels are defined as follows: ● Level 1 — inputs to the valuation methodology based on quoted prices (unadjusted) for identical assets or liabilities in active markets. ● Level 2 — inputs to the valuation methodology based on quoted prices for similar assets or liabilities in active markets for substantially the full term of the financial instrument; quoted prices for identical or similar instruments in markets that are not active for substantially the full term of the financial instrument; and model-derived valuations whose inputs or significant value drivers are observable. ● Level 3 — inputs to the valuation methodology based on unobservable prices or valuation techniques that are significant to the fair value measurement. The following table summarizes the carrying values and the estimated fair values of the Company’s debt instruments: Carrying Value Fair Value April 30, April 30, January 31, April 30, April 30, January 31, Financial Instrument Level 2023 2022 2023 2023 2022 2023 (In thousands) Secured Notes 1 $ 400,000 $ 400,000 $ 400,000 $ 376,000 $ 416,000 $ 380,000 Revolving credit facility 2 — — 80,087 — — 80,087 Note issued to LVMH 3 123,019 115,926 121,202 121,476 112,306 119,426 Unsecured loans 2 11,212 7,845 10,866 11,212 7,845 10,866 Overdraft facilities 2 4,132 3,131 3,657 4,132 3,131 3,657 Foreign credit facility 2 8,462 — 7,792 8,462 — 7,792 The Company’s debt instruments are recorded at their carrying values in its condensed consolidated balance sheets, which may differ from their respective fair values. The fair value of the Company’s secured notes is based on their current market price as of April 30, 2023. The carrying amount of the Company’s variable rate debt approximates the fair value, as interest rates change with the market rates. Furthermore, the carrying value of all other financial instruments potentially subject to valuation risk (principally consisting of cash, accounts receivable and accounts payable) also approximates fair value due to the short-term nature of these accounts. The 2% note in the principal amount of $125 million (the “LVMH Note”) issued to LVMH Moet Hennessy Louis Vuitton Inc. (“LVMH”) in connection with the acquisition of DKNY and Donna Karan was recorded on the balance sheet at a discount of $40.0 million in accordance with ASC 820 – Fair Value Measurements The fair value of the LVMH Note was considered a Level 3 valuation in the fair value hierarchy. Non-Financial Assets and Liabilities The Company’s non-financial assets that are measured at fair value on a nonrecurring basis include long-lived assets, which consist primarily of property and equipment and operating lease assets. The Company reviews these assets for impairment whenever events or changes in circumstances indicate that their carrying value may not be fully recoverable. For assets that are not recoverable, an impairment loss is recognized equal to the difference between the carrying amount of the asset or asset group and its estimated fair value. For operating lease assets, the Company determines the fair value of the assets by discounting the estimated market rental rates over the remaining term of the lease. These fair value measurements are considered level 3 measurements in the fair value hierarchy. During fiscal 2023, the Company recorded a $2.7 million impairment charge related to leasehold improvements, furniture and fixtures and operating lease assets at certain DKNY, Karl Lagerfeld Paris and Vilebrequin stores as a result of the performance of these stores. |
LEASES
LEASES | 3 Months Ended |
Apr. 30, 2023 | |
LEASES [Abstract] | |
LEASES | NOTE 5 – LEASES The Company leases retail stores, warehouses, distribution centers, office space and certain equipment. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company recognizes lease expense for these leases on a straight-line basis over the lease term. Most leases are for a term of one one Certain of the Company’s lease agreements include rental payments based on a percentage of retail sales over contractual levels and others include rental payments adjusted periodically for inflation. The Company’s leases do not contain any material residual value guarantees or material restrictive covenants. The Company’s lease assets and liabilities as of April 30, 2023, April 30, 2022 and January 31, 2023 consist of the following: Leases Classification April 30, 2023 April 30, 2022 January 31, 2023 (In thousands) Assets Operating Operating lease assets $ 237,056 $ 164,607 $ 239,665 Liabilities Current operating Current operating lease liabilities $ 51,024 $ 41,112 $ 52,917 Noncurrent operating Noncurrent operating lease liabilities 202,406 139,686 204,974 Total lease liabilities $ 253,430 $ 180,798 $ 257,891 The Company’s operating lease assets and operating lease liabilities increased during fiscal 2023 primarily due to the acquisition of KLH. The Company recorded lease costs of $18.6 million and $14.1 million during the three months ended April 30, 2023 and 2022, respectively. Lease costs are recorded within selling, general and administrative expenses in the Company’s condensed consolidated statements of operations and comprehensive income. The Company recorded variable lease costs and short-term lease costs of $5.9 million and $5.1 million for the three months ended April 30, 2023 and 2022, respectively. Short-term lease costs are immaterial. As of April 30, 2023, the Company’s maturity of operating lease liabilities in the years ending up to January 31, 2028 and thereafter are as follows: Year Ending January 31, Amount (In thousands) 2024 $ 51,368 2025 67,036 2026 56,130 2027 45,065 2028 36,772 After 2028 57,057 Total lease payments $ 313,428 Less: Interest 59,998 Present value of lease liabilities $ 253,430 As of April 30, 2023, there are no material leases that are legally binding but have not yet commenced. As of April 30, 2023, the weighted average remaining lease term related to operating leases is 5.4 years. The weighted average discount rate related to operating leases is 8.0%. Cash paid for amounts included in the measurement of operating lease liabilities is $21.2 million and $15.0 million during the three months ended April 30, 2023 and 2022, respectively. Right-of-use assets obtained in exchange for lease obligations were $10.5 million and $8.6 million during the three months ended April 30, 2023 and 2022, respectively. |
KARL LAGERFELD ACQUISITION
KARL LAGERFELD ACQUISITION | 3 Months Ended |
Apr. 30, 2023 | |
KARL LAGERFELD ACQUISITION [Abstract] | |
KARL LAGERFELD ACQUISITION | NOTE 6 – KARL LAGERFELD ACQUISITION On April 29, 2022, the Company entered into a share purchase agreement (the “Purchase Agreement”) with a group of investors pursuant to which the Company agreed to acquire, on the terms set forth and subject to the conditions set forth in the Purchase Agreement, the remaining 81% interest in KLH that it did not already own, for an aggregate consideration of €193.4 million (approximately $207.6 million) in cash, after taking into account certain adjustments. The acquisition closed on May 31, 2022. The Company funded the purchase price from cash on hand. On May 31, 2022, the effective date of the acquisition, the Company’s previously held 19% investment in KLH and 49% investment in KLNA were remeasured at fair value using a market approach based on the purchase price of the acquisition and a discount for lack of control related to the Company’s previously held minority investment in KLH. As a result of this remeasurement, a non-cash gain of $27.1 million was recorded as of the effective date of the acquisition. The addition of KLH to the Company’s portfolio of owned brands advances several of its strategic initiatives, including increasing its direct ownership of brands and their licensing opportunities and further diversifying its global presence. This acquisition offers additional opportunities to expand the Company’s international growth by further developing its European-based brands, which also include Vilebrequin and Sonia Rykiel. The Company believes that KLH’s existing digital channel presence provides an opportunity for the Company to enhance its omni-channel business and further accelerate its digital initiatives. Purchase Price Consideration The purchase price of $207.6 million, after taking into account certain adjustments, was paid from cash on hand. The purchase price has been revised to include adjustments in accordance with the Purchase Agreement. The initial purchase price and the valuation of the prior minority ownership for the acquisition of KLH is as follows (in thousands): Cash disbursed for the acquisition of KLH $ 168,592 Plus: cash acquired 38,499 Plus: aggregate adjustments to purchase price 516 Initial purchase price 207,607 Plus: fair value of prior minority ownership 102,858 Total consideration $ 310,465 Allocation of the Purchase Price Consideration The following table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: (In thousands) Cash and cash equivalents $ 38,499 Accounts receivable, net 28,449 Inventories 33,489 Prepaid income taxes 1,100 Prepaid expenses and other current assets 3,347 Property, plant and equipment, net 11,545 Operating lease assets 55,753 Goodwill 84,336 Trademarks 178,823 Customer relationships 4,294 Deferred income taxes 5,131 Other long-term assets 2,237 Total assets acquired $ 447,003 Notes payable 3,606 Accounts payable 9,175 Accrued expenses 15,261 Operating lease liabilities 58,942 Income taxes payable 2,099 Deferred income taxes 42,222 Other long-term liabilities 5,233 Total liabilities assumed $ 136,538 Total fair value of acquisition consideration $ 310,465 During the year ended January 31, 2023, the Company recorded adjustments to the fair values of assets acquired and liabilities assumed at the date of acquisition based on additional information obtained. The Company recorded an additional $36.9 million in both total assets and total liabilities The Company recognized goodwill of approximately $84.3 million in connection with the acquisition of KLH. The goodwill was assigned to the Company’s wholesale operations reporting unit. The Company intends to make an election under Internal Revenue Code Section 338(g) to amortize the total goodwill and intangible assets over a 15 year period for income tax purposes in the United States. The fair values assigned to identifiable intangible assets acquired were based on assumptions and estimates made by management using unobservable inputs reflecting the Company’s own assumptions about the inputs that market participants would use in pricing the asset or liability based on the best information available. The fair values of the trademarks were determined using the relief from royalty method and the fair value of the customer relationships were determined using an income approach. The Company classifies these intangibles as Level 3 fair value measurements. Identifiable intangible assets acquired include the following (in thousands): Weighted Average Fair Value Amortization Period Trademarks $ 178,823 — Customer relationships 4,294 8 $ 183,117 — The Company recognized approximately $5.6 million of acquisition related costs that were expensed in fiscal 2023 and fiscal 2022. The fiscal 2023 and fiscal 2022 acquisition and integration costs were recorded within selling, general and administrative expenses in the Company’s condensed consolidated statements of operations and comprehensive income for the fiscal years ended January 31, 2023 and 2022, respectively. The estimates of fair value of assets acquired and liabilities assumed are preliminary and subject to change based on completion of certain working capital adjustments and the tax implications of the Company’s purchase price allocation. The purchase price allocation for acquired companies can be modified for up to one year from the date of acquisition. |
Net Income per Common Share
Net Income per Common Share | 3 Months Ended |
Apr. 30, 2023 | |
Net Income per Common Share | |
Net Income per Common Share | NOTE 7 – NET INCOME PER COMMON SHARE Basic net income per common share has been computed using the weighted average number of common shares outstanding during each period. Diluted net income per share, when applicable, is computed using the weighted average number of common shares and potential dilutive common shares, consisting of unvested restricted stock unit awards outstanding during the period. Approximately 302,200 and 113,300 shares of common stock have been excluded from the diluted net income per share calculation for the three months ended April 30, 2023 and 2022, respectively. All share-based payments outstanding that vest based on the achievement of performance conditions, and for which the respective performance conditions have not been achieved, have been excluded from the diluted per share calculation. The following table reconciles the numerators and denominators used in the calculation of basic and diluted net income per share: Three Months Ended April 30, 2023 2022 (In thousands, except share and per share amounts) Net income attributable to G-III Apparel Group, Ltd. $ 3,236 $ 30,634 Basic net income per share: Basic common shares 46,286 48,016 Basic net income per share $ 0.07 $ 0.64 Diluted net income per share: Basic common shares 46,286 48,016 Dilutive restricted stock unit awards and stock options 1,156 1,092 Diluted common shares 47,442 49,108 Diluted net income per share $ 0.07 $ 0.62 |
NOTES PAYABLE
NOTES PAYABLE | 3 Months Ended |
Apr. 30, 2023 | |
NOTES PAYABLE [Abstract] | |
NOTES PAYABLE | NOTE 8 – NOTES PAYABLE Long-term debt consists of the following: April 30, 2023 April 30, 2022 January 31, 2023 (In thousands) Secured Notes $ 400,000 $ 400,000 $ 400,000 Revolving credit facility — — 80,087 LVMH Note 125,000 125,000 125,000 Unsecured loans 11,212 7,845 10,866 Overdraft facilities 4,132 3,131 3,657 Foreign credit facility 8,462 — 7,792 Subtotal 548,806 535,976 627,402 Less: Net debt issuance costs (1) (3,821) (5,520) (4,246) Debt discount (1,981) (9,074) (3,798) Current portion of long-term debt (139,418) (4,554) (135,518) Total $ 403,586 $ 516,828 $ 483,840 (1) Does not include debt issuance costs, net of amortization, totaling $3.6 million, $5.2 million and $4.0 million as of April 30, 2023, April 30, 2022 and January 31, 2023, respectively, related to the revolving credit facility. These debt issuance costs have been deferred and are classified in assets in the accompanying condensed consolidated balance sheets in accordance with ASC 835. Senior Secured Notes In August 2020, the Company completed a private debt offering of $400 million aggregate principal amount of its 7.875% Senior Secured Notes due 2025 (the “Notes”). The terms of the Notes are governed by an indenture (the “Indenture”), among the Company, the guarantors party thereto and U.S. Bank, National Association, as trustee and collateral agent (the “Collateral Agent”). The net proceeds of the Notes were used (i) to repay the $300 million that was outstanding under the Company’s prior term loan facility due 2022 (the “Term Loan”), (ii) to pay related fees and expenses and (iii) for general corporate purposes. The Notes bear interest at a rate of 7.875% per year payable semi-annually in arrears on February 15 and August 15 of each year. The Notes are unconditionally guaranteed on a senior-priority secured basis by the Company’s current and future wholly-owned domestic subsidiaries that guarantee any of the Company’s credit facilities, including the Company’s ABL facility (the “ABL Facility”) pursuant to the ABL Credit Agreement, or certain future capital markets indebtedness of the Company or guarantors. The Notes and the related guarantees are secured by (i) first priority liens on the Company’s Cash Flow Priority Collateral (as defined in the Indenture), and (ii) a second-priority lien on the Company’s ABL Priority Collateral (as defined in the Indenture), in each case subject to permitted liens described in the Indenture. In connection with the issuance of the Notes and execution of the Indenture, the Company and the Guarantors entered into a pledge and security agreement (the “Pledge and Security Agreement”), among the Company, the Guarantors and the Collateral Agent. The Notes are subject to the terms of the intercreditor agreement which governs the relative rights of the secured parties in respect of the ABL Facility and the Notes (the “Intercreditor Agreement”). The Intercreditor Agreement restricts the actions permitted to be taken by the Collateral Agent with respect to the Collateral on behalf of the holders of the Notes. The Notes are also subject to the terms of the LVMH Note subordination agreement which governs the relative rights of the secured parties in respect of the LVMH Note, the ABL Facility and the Notes. The Company may redeem some or all of the Notes at any time and from time to time at the redemption prices set forth in the Indenture, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date. If the Company experiences a Change of Control (as defined in the Indenture), the Company is required to offer to repurchase the Notes at 101% of the principal amount of such Notes plus accrued and unpaid interest, if any, to, but excluding, the date of repurchase. The Indenture contains covenants that, among other things, limit the Company’s ability and the ability of its restricted subsidiaries to incur or guarantee additional indebtedness, pay dividends or make other restricted payments, make certain investments, incur restrictions on the ability of the Company’s restricted subsidiaries that are not guarantors to pay dividends or make certain other payments, create or incur certain liens, sell assets and subsidiary stock, impair the security interests, transfer all or substantially all of the Company’s assets or enter into merger or consolidation transactions, and enter into transactions with affiliates. The Indenture provides for customary events of default which include (subject in certain cases to customary grace and cure periods), among others, nonpayment of principal or interest, breach of other agreements in the Indenture, failure to pay certain other indebtedness, failure of certain guarantees to be enforceable, failure to perfect certain collateral securing the Notes, failure to pay certain final judgments, and certain events of bankruptcy or insolvency. The Company incurred debt issuance costs totaling $8.5 million related to the Notes. In accordance with ASC 835, the debt issuance costs have been deferred and are presented as a contra-liability, offsetting the outstanding balance of the Notes, and are amortized over the remaining life of the Notes. Second Amended and Restated ABL Credit Agreement In August 2020, the Company’s subsidiaries, G-III Leather Fashions, Inc., Riviera Sun, Inc., CK Outerwear, LLC, AM Retail Group, Inc. and The Donna Karan Company Store LLC (collectively, the “Borrowers”), entered into the second amended and restated credit agreement (the “ABL Credit Agreement”) with the Lenders named therein and with JPMorgan Chase Bank, N.A., as Administrative Agent. The ABL Credit Agreement is a five year senior secured credit facility subject to a springing maturity date if, subject to certain conditions, the LVMH Note is not refinanced or repaid prior to the date that is 91 days prior to the date of any relevant payment thereunder. The ABL Credit Agreement provides for borrowings in the aggregate principal amount of up to $650 million. The Company and certain of its subsidiaries (the “Guarantors”), are Loan Guarantors under the ABL Credit Agreement. The ABL Credit Agreement refinanced, amended and restated the Amended Credit Agreement, dated as of December 1, 2016 (as amended, supplemented or otherwise modified from time to time prior to August 7, 2020, the “Prior Credit Agreement”). The Prior Credit Agreement provided for borrowings of up to $650 million. The ABL Credit Agreement extended the maturity date of this facility from December 2021 to August 2025, subject to a springing maturity date if, subject to certain conditions, the LVMH Note is not refinanced or repaid prior to the date that is 91 days prior to the date of any relevant payment thereunder. Amounts available under the ABL Credit Agreement are subject to borrowing base formulas and overadvances as specified in the ABL Credit Agreement. Borrowings bear interest, at the Borrowers’ option, at LIBOR plus a margin of 1.75% to 2.25% or an alternate base rate margin of 0.75% to 1.25% (defined as the greatest of (i) the “prime rate” of JPMorgan Chase Bank, N.A. from time to time, (ii) the federal funds rate plus 0.5% and (iii) the LIBOR rate for a borrowing with an interest period of one month) plus 1.00%, with the applicable margin determined based on Borrowers’ availability under the ABL Credit Agreement. The calculation of the interest rate under the ABL Credit Agreement has been revised as set forth in the next paragraph. The ABL Credit Agreement is secured by specified assets of the Borrowers and the Guarantors. In addition to paying interest on any outstanding borrowings under the ABL Credit Agreement, the Company is required to pay a commitment fee to the lenders under the credit agreement with respect to the unutilized commitments. The commitment fee accrues at a tiered rate equal to 0.50% per annum on the average daily amount of the available commitments when the average usage is less than 50% of the total available commitments and decreases to 0.35% per annum on the average daily amount of the available commitments when the average usage is greater than or equal to 50% of the total available commitments. As of April 30, 2023, interest under the ABL Credit Agreement was being paid at an average rate of 6.62% per annum. On April 20, 2023, the Company amended the ABL Credit Agreement to replace LIBOR with the Adjusted Term Secured Overnight Financing Rate (“SOFR”) as a successor rate. All other material terms and conditions of the ABL Credit Agreement were unchanged. Borrowings under the amended ABL Credit Agreement will bear interest, at the Borrower’s option, at the alternate base rate (defined as, for a given day, the greatest of (i) the “prime rate” in effect on such day, (ii) the NYFRB Rate (as defined in the amendment) in effect on such day plus 0.5% and (iii) the Adjusted Term SOFR (defined as an interest rate per annum equal to the Term SOFR for such interest period plus 0.10%) for a one-month interest period as published two business days prior to such day plus 1%) plus an applicable spread or the Adjusted Term SOFR Rate plus an applicable spread. The Company applied certain provisions and practical expedients of ASC 848 – Reference Rate Reform related to the transition from LIBOR to SOFR. The revolving credit facility contains covenants that, among other things, restrict the Company’s ability to, subject to specified exceptions, incur additional debt; incur liens; sell or dispose of certain assets; merge with other companies; liquidate or dissolve the Company; acquire other companies; make loans, advances, or guarantees; and make certain investments. In certain circumstances, the revolving credit facility also requires the Company to maintain a fixed charge coverage ratio, as defined in the agreement, not less than 1.00 to 1.00 for each period of twelve consecutive fiscal months of the Company. As of April 30, 2023, the Company was in compliance with these covenants. As of April 30, 2023, the Company had no borrowings outstanding under the ABL Credit Agreement. The ABL credit agreement also includes amounts available for letters of credit. As of April 30, 2023, there were outstanding trade and standby letters of credit amounting to $7.8 million and $2.9 million, respectively. At the date of the refinancing of the Prior Credit Agreement, the Company had $3.3 million of unamortized debt issuance costs remaining from the Prior Credit Agreement. The Company extinguished and charged to interest expense $0.4 million of the prior debt issuance costs and incurred new debt issuance costs totaling $5.1 million related to the ABL Credit Agreement. The Company has a total of $8.0 million of debt issuance costs related to the ABL Credit Agreement. As permitted under ASC 835, the debt issuance costs have been deferred and are presented as an asset which is amortized ratably over the term of the ABL Credit Agreement. LVMH Note As a portion of the consideration for the acquisition of Donna Karan International (“DKI”), the Company issued to LVMH a junior lien secured promissory note in the principal amount of $125.0 million that bears interest at the rate of 2% per year. $75.0 million of the principal amount of the LVMH Note is due and payable on June 1, 2023 and $50.0 million of such principal amount is due and payable on December 1, 2023. The LVMH Note is classified in current portion of notes payable in the Company’s condensed consolidated balance sheet as of April 30, 2023. ASC 820 requires the LVMH Note to be recorded at fair value at issuance. As a result, the Company recorded a $40.0 million debt discount upon issuance of the LVMH Note. This discount is being amortized as interest expense using the effective interest method over the term of the LVMH Note. Unsecured Loans Several of the Company’s foreign entities borrow funds under various unsecured loans of which a portion is to provide funding for operations in the normal course of business while other loans are European state backed loans as part of COVID-19 relief programs. In the aggregate, the Company is currently required to make quarterly installment payments of principal in the amount of €0.6 million under these loans. Interest on the outstanding principal amount of the unsecured loans accrues at a fixed rate equal to 0% to 5.0% per annum, payable on either a quarterly or monthly basis. As of April 30, 2023, the Company had an aggregate outstanding balance of €10.3 million ($11.2 million) under these unsecured loans. Overdraft Facilities During fiscal 2021, T.R.B International SA (“TRB”) entered into several overdraft facilities that allow for applicable bank accounts to be in a negative position up to a certain maximum overdraft. TRB entered into an uncommitted overdraft facility with HSBC Bank allowing for a maximum overdraft of €5 million. Interest on drawn balances accrues at a rate equal to the Euro Interbank Offered Rate plus a margin of 1.75% per annum, payable quarterly. The facility may be cancelled at any time by TRB or HSBC Bank. As part of a COVID-19 relief program, TRB and its subsidiaries have also entered into several state backed overdraft facilities with UBS Bank in Switzerland for an aggregate of CHF 4.7 million at varying interest rates of 0% to 0.5%. As of April 30, 2023, TRB had an aggregate of €3.8 million ($4.1 million) drawn under these facilities. Foreign Credit Facility KLH has a credit agreement with ABN AMRO Bank N.V. with a credit limit of €15.0 million which is secured by specified assets of KLH. Borrowings bear interest at the Euro Interbank Offered Rate (“EURIBOR”) plus a margin of 1.7%. As of April 30, 2023, KLH had €7.8 million ($8.5 million) of borrowings outstanding under this credit facility. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 3 Months Ended |
Apr. 30, 2023 | |
REVENUE RECOGNITION [Abstract] | |
REVENUE RECOGNITION | NOTE 9 – REVENUE RECOGNITION Disaggregation of Revenue In accordance with ASC 606 – Revenue from Contracts with Customers Wholesale Operations Segment. Retail Operations Segment. Contract Liabilities The Company’s contract liabilities, which are recorded within accrued expenses in the accompanying condensed consolidated balance sheets, primarily consist of gift card liabilities and advance payments from licensees. In some of its retail concepts, the Company also offers a limited loyalty program where customers accumulate points redeemable for cash discount certificates that expire 90 days after issuance. Total contract liabilities were $4.1 million, $3.6 million and $5.1 million at April 30, 2023, April 30, 2022 and January 31, 2023, respectively. The Company recognized $3.6 million in revenue for the three months ended April 30, 2023 related to contract liabilities that existed at January 31, 2023. The Company recognized $3.7 million in revenue for the three months ended April 30, 2022 related to contract liabilities that existed at January 31, 2022. There were no contract assets recorded as of April 30, 2023, April 30, 2022 and January 31, 2023. Substantially all of the advance payments from licensees as of April 30, 2023 are expected to be recognized as revenue within the next twelve months. |
SEGMENTS
SEGMENTS | 3 Months Ended |
Apr. 30, 2023 | |
SEGMENTS [Abstract] | |
SEGMENTS | NOTE 10 – SEGMENTS The Company’s reportable segments are business units that offer products through different channels of distribution. The Company has two reportable segments: wholesale operations and retail operations. The wholesale operations segment includes sales of products under the Company’s owned, licensed and private label brands, as well as sales related to the Vilebrequin and Karl Lagerfeld businesses, other than sales of the Karl Lagerfeld Paris brand from retail stores and digital outlets. Wholesale revenues also include revenues from license agreements related to our owned trademarks including DKNY, Donna Karan, Karl Lagerfeld, Vilebrequin, G.H. Bass, Andrew Marc and Sonia Rykiel. The retail operations segment consists primarily of direct sales to consumers through Company-operated stores, which consists primarily of DKNY and Karl Lagerfeld Paris stores, as well as the digital channels for DKNY, Donna Karan, Karl Lagerfeld Paris, G.H. Bass, Andrew Marc and Wilsons Leather. Substantially all DKNY and Karl Lagerfeld Paris stores are operated as outlet stores. The following segment information is presented for the three month periods indicated below: Three Months Ended April 30, 2023 Wholesale Retail Elimination (1) Total (In thousands) Net sales $ 586,903 $ 30,217 $ (10,531) $ 606,589 Cost of goods sold 352,470 14,849 (10,531) 356,788 Gross profit 234,433 15,368 — 249,801 Selling, general and administrative expenses 204,089 23,872 — 227,961 Depreciation and amortization 5,745 831 — 6,576 Operating profit (loss) $ 24,599 $ (9,335) $ — $ 15,264 Three Months Ended April 30, 2022 Wholesale Retail Elimination (1) Total (In thousands) Net sales $ 680,904 $ 27,885 $ (20,032) $ 688,757 Cost of goods sold 448,769 13,981 (20,032) 442,718 Gross profit 232,135 13,904 — 246,039 Selling, general and administrative expenses 161,808 23,599 — 185,407 Depreciation and amortization 5,414 681 — 6,095 Operating profit (loss) $ 64,913 $ (10,376) $ — $ 54,537 (1) Represents intersegment sales to the Company’s retail operations segment. The total net sales by licensed and proprietary product sales for each of the Company’s reportable segments are as follows: Three Months Ended April 30, 2023 April 30, 2022 (In thousands) Licensed brands $ 298,005 $ 459,984 Proprietary brands 288,898 220,920 Wholesale net sales (1) $ 586,903 $ 680,904 Licensed brands $ — $ 13,928 Proprietary brands 30,217 13,957 Retail net sales $ 30,217 $ 27,885 (1) The Company acquired the remaining interests in KLH (the Karl Lagerfeld branded product) that it did not already own as of May 31, 2022. Net sales of Karl Lagerfeld product were included in licensed brand net sales of the wholesale operations segment through May 31, 2022. Subsequent to May 31, 2022, net sales of Karl Lagerfeld product are included in proprietary brands net sales of the wholesale operations segment . |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 3 Months Ended |
Apr. 30, 2023 | |
STOCKHOLDERS' EQUITY, [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 11 – STOCKHOLDERS’ EQUITY For the three months ended April 30, 2023, the Company issued no shares of common stock and utilized 2,001 shares of treasury stock in connection with the vesting of equity awards. For the three months ended April 30, 2022, the Company issued no shares of common stock and utilized 271,536 shares of treasury stock in connection with the vesting of equity awards. |
Canadian Customs Duty Examinati
Canadian Customs Duty Examination | 3 Months Ended |
Apr. 30, 2023 | |
Canadian Customs Duty Examination [Abstract] | |
Canadian Customs Duty Examination | NOTE 12 – CANADIAN CUSTOMS DUTY EXAMINATION In accordance with a favorable ruling by the Canadian International Trade Tribunal, in fiscal 2023, G-III Canada received a refund from the of CAD $1.5 million ( $1.1 million), including interest and net of a dutiable design assist, for amounts paid by G-III Canada to the CBSA between February 1, 2014 and January 31, 2018. G-III Canada has filed adjustment requests with the CBSA for the period from February 1, 2018 to January 31, 2022 to amend declared dutiable values. These amendments are expected to result in a refund of duty and interest from the CBSA of approximately CAD $13.3 million ( $9.8 million) plus related interest. These amounts are recorded within other assets, net on the condensed consolidated balance sheets. |
Recent Adopted and Issued Accou
Recent Adopted and Issued Accounting Pronouncements | 3 Months Ended |
Apr. 30, 2023 | |
Recent Adopted and Issued Accounting Pronouncements [Abstract] | |
Recent Adopted and Issued Accounting Pronouncements | NOTE 13 – RECENT ADOPTED AND ISSUED ACCOUNTING PRONOUNCEMENTS Recently Adopted Accounting Guidance There was no accounting guidance adopted during the three months ended April 30, 2023. Issued Accounting Guidance Being Evaluated for Adoption The Company has reviewed all recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact to the consolidated financial statements. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Apr. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 14 – SUBSEQUENT EVENTS In May 2023, the Company entered into a global twenty-five year master license agreement with Xcel Brands to design and produce all categories of men’s and women’s product for the Halston brand. The agreement provides for an initial term of five years, followed by a twenty-year period, as well as a purchase option at the end of the twenty-five year term. First deliveries of Halston product are expected to begin in the fall of 2024. The product will be distributed globally through better department stores and digital channels. |
Recent Adopted and Issued Acc_2
Recent Adopted and Issued Accounting Pronouncements (Policies) | 3 Months Ended |
Apr. 30, 2023 | |
Recent Adopted and Issued Accounting Pronouncements [Abstract] | |
Effects of Recently Adopted and Issued Accounting Pronouncements | Recently Adopted Accounting Guidance There was no accounting guidance adopted during the three months ended April 30, 2023. |
ALLOWANCE FOR DOUBTFUL ACCOUN_2
ALLOWANCE FOR DOUBTFUL ACCOUNTS (Tables) | 3 Months Ended |
Apr. 30, 2023 | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
Accounts Receivable and Allowance for Doubtful Accounts | The Company’s accounts receivable and allowance for doubtful accounts as of April 30, 2023, April 30, 2022 and January 31, 2023 were: April 30, 2023 Wholesale Retail Total (In thousands) Accounts receivable, gross $ 512,315 $ 1,118 $ 513,433 Allowance for doubtful accounts (18,769) (63) (18,832) Accounts receivable, net $ 493,546 $ 1,055 $ 494,601 April 30, 2022 Wholesale Retail Total (In thousands) Accounts receivable, gross $ 589,233 $ 1,319 $ 590,552 Allowance for doubtful accounts (16,858) (81) (16,939) Accounts receivable, net $ 572,375 $ 1,238 $ 573,613 January 31, 2023 Wholesale Retail Total (In thousands) Accounts receivable, gross $ 692,033 $ 1,227 $ 693,260 Allowance for doubtful accounts (18,237) (60) (18,297) Accounts receivable, net $ 673,796 $ 1,167 $ 674,963 |
Activity in Allowance for Credit Losses | The Company had the following activity in its allowance for credit losses: Wholesale Retail Total (In thousands) Balance as of January 31, 2023 $ (18,237) $ (60) $ (18,297) Provision for credit losses, net (532) (3) (535) Accounts written off as uncollectible — — — Balance as of April 30, 2023 $ (18,769) $ (63) $ (18,832) Balance as of January 31, 2022 $ (17,307) $ (84) $ (17,391) Provision for credit losses, net 411 3 414 Accounts written off as uncollectible 38 — 38 Balance as of April 30, 2022 $ (16,858) $ (81) $ (16,939) Balance as of January 31, 2022 $ (17,307) $ (84) $ (17,391) Provision for credit losses, net (1,002) 24 (978) Accounts written off as uncollectible 72 — 72 Balance as of January 31, 2023 $ (18,237) $ (60) $ (18,297) |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Apr. 30, 2023 | |
Fair Value of Financial Instruments [Abstract] | |
Schedule of carrying values and estimated fair values of debt instruments | The following table summarizes the carrying values and the estimated fair values of the Company’s debt instruments: Carrying Value Fair Value April 30, April 30, January 31, April 30, April 30, January 31, Financial Instrument Level 2023 2022 2023 2023 2022 2023 (In thousands) Secured Notes 1 $ 400,000 $ 400,000 $ 400,000 $ 376,000 $ 416,000 $ 380,000 Revolving credit facility 2 — — 80,087 — — 80,087 Note issued to LVMH 3 123,019 115,926 121,202 121,476 112,306 119,426 Unsecured loans 2 11,212 7,845 10,866 11,212 7,845 10,866 Overdraft facilities 2 4,132 3,131 3,657 4,132 3,131 3,657 Foreign credit facility 2 8,462 — 7,792 8,462 — 7,792 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Apr. 30, 2023 | |
LEASES [Abstract] | |
Schedule of lease assets and liabilities | The Company’s lease assets and liabilities as of April 30, 2023, April 30, 2022 and January 31, 2023 consist of the following: Leases Classification April 30, 2023 April 30, 2022 January 31, 2023 (In thousands) Assets Operating Operating lease assets $ 237,056 $ 164,607 $ 239,665 Liabilities Current operating Current operating lease liabilities $ 51,024 $ 41,112 $ 52,917 Noncurrent operating Noncurrent operating lease liabilities 202,406 139,686 204,974 Total lease liabilities $ 253,430 $ 180,798 $ 257,891 |
Schedule of maturity of operating lease liabilities | As of April 30, 2023, the Company’s maturity of operating lease liabilities in the years ending up to January 31, 2028 and thereafter are as follows: Year Ending January 31, Amount (In thousands) 2024 $ 51,368 2025 67,036 2026 56,130 2027 45,065 2028 36,772 After 2028 57,057 Total lease payments $ 313,428 Less: Interest 59,998 Present value of lease liabilities $ 253,430 |
KARL LAGERFELD ACQUISITION (Tab
KARL LAGERFELD ACQUISITION (Tables) | 3 Months Ended |
Apr. 30, 2023 | |
KARL LAGERFELD ACQUISITION [Abstract] | |
Schedule of total consideration paid for acquisition | The initial purchase price and the valuation of the prior minority ownership for the acquisition of KLH is as follows (in thousands): Cash disbursed for the acquisition of KLH $ 168,592 Plus: cash acquired 38,499 Plus: aggregate adjustments to purchase price 516 Initial purchase price 207,607 Plus: fair value of prior minority ownership 102,858 Total consideration $ 310,465 |
Schedule of fair values of assets acquired and liabilities | The following table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition: (In thousands) Cash and cash equivalents $ 38,499 Accounts receivable, net 28,449 Inventories 33,489 Prepaid income taxes 1,100 Prepaid expenses and other current assets 3,347 Property, plant and equipment, net 11,545 Operating lease assets 55,753 Goodwill 84,336 Trademarks 178,823 Customer relationships 4,294 Deferred income taxes 5,131 Other long-term assets 2,237 Total assets acquired $ 447,003 Notes payable 3,606 Accounts payable 9,175 Accrued expenses 15,261 Operating lease liabilities 58,942 Income taxes payable 2,099 Deferred income taxes 42,222 Other long-term liabilities 5,233 Total liabilities assumed $ 136,538 Total fair value of acquisition consideration $ 310,465 |
Schedule of identifiable intangible assets | Weighted Average Fair Value Amortization Period Trademarks $ 178,823 — Customer relationships 4,294 8 $ 183,117 — |
Net Income per Common Share (Ta
Net Income per Common Share (Tables) | 3 Months Ended |
Apr. 30, 2023 | |
Net Income per Common Share | |
Schedule of reconciliation between basic and diluted net income per share | The following table reconciles the numerators and denominators used in the calculation of basic and diluted net income per share: Three Months Ended April 30, 2023 2022 (In thousands, except share and per share amounts) Net income attributable to G-III Apparel Group, Ltd. $ 3,236 $ 30,634 Basic net income per share: Basic common shares 46,286 48,016 Basic net income per share $ 0.07 $ 0.64 Diluted net income per share: Basic common shares 46,286 48,016 Dilutive restricted stock unit awards and stock options 1,156 1,092 Diluted common shares 47,442 49,108 Diluted net income per share $ 0.07 $ 0.62 |
NOTES PAYABLE (Tables)
NOTES PAYABLE (Tables) | 3 Months Ended |
Apr. 30, 2023 | |
NOTES PAYABLE [Abstract] | |
Schedule of long-term debt | Long-term debt consists of the following: April 30, 2023 April 30, 2022 January 31, 2023 (In thousands) Secured Notes $ 400,000 $ 400,000 $ 400,000 Revolving credit facility — — 80,087 LVMH Note 125,000 125,000 125,000 Unsecured loans 11,212 7,845 10,866 Overdraft facilities 4,132 3,131 3,657 Foreign credit facility 8,462 — 7,792 Subtotal 548,806 535,976 627,402 Less: Net debt issuance costs (1) (3,821) (5,520) (4,246) Debt discount (1,981) (9,074) (3,798) Current portion of long-term debt (139,418) (4,554) (135,518) Total $ 403,586 $ 516,828 $ 483,840 (1) Does not include debt issuance costs, net of amortization, totaling $3.6 million, $5.2 million and $4.0 million as of April 30, 2023, April 30, 2022 and January 31, 2023, respectively, related to the revolving credit facility. These debt issuance costs have been deferred and are classified in assets in the accompanying condensed consolidated balance sheets in accordance with ASC 835. |
SEGMENTS (Tables)
SEGMENTS (Tables) | 3 Months Ended |
Apr. 30, 2023 | |
SEGMENTS [Abstract] | |
Schedule of information regarding reportable segments | The following segment information is presented for the three month periods indicated below: Three Months Ended April 30, 2023 Wholesale Retail Elimination (1) Total (In thousands) Net sales $ 586,903 $ 30,217 $ (10,531) $ 606,589 Cost of goods sold 352,470 14,849 (10,531) 356,788 Gross profit 234,433 15,368 — 249,801 Selling, general and administrative expenses 204,089 23,872 — 227,961 Depreciation and amortization 5,745 831 — 6,576 Operating profit (loss) $ 24,599 $ (9,335) $ — $ 15,264 Three Months Ended April 30, 2022 Wholesale Retail Elimination (1) Total (In thousands) Net sales $ 680,904 $ 27,885 $ (20,032) $ 688,757 Cost of goods sold 448,769 13,981 (20,032) 442,718 Gross profit 232,135 13,904 — 246,039 Selling, general and administrative expenses 161,808 23,599 — 185,407 Depreciation and amortization 5,414 681 — 6,095 Operating profit (loss) $ 64,913 $ (10,376) $ — $ 54,537 (1) Represents intersegment sales to the Company’s retail operations segment. |
Schedule of total net sales for each reportable segments | The total net sales by licensed and proprietary product sales for each of the Company’s reportable segments are as follows: Three Months Ended April 30, 2023 April 30, 2022 (In thousands) Licensed brands $ 298,005 $ 459,984 Proprietary brands 288,898 220,920 Wholesale net sales (1) $ 586,903 $ 680,904 Licensed brands $ — $ 13,928 Proprietary brands 30,217 13,957 Retail net sales $ 30,217 $ 27,885 (1) The Company acquired the remaining interests in KLH (the Karl Lagerfeld branded product) that it did not already own as of May 31, 2022. Net sales of Karl Lagerfeld product were included in licensed brand net sales of the wholesale operations segment through May 31, 2022. Subsequent to May 31, 2022, net sales of Karl Lagerfeld product are included in proprietary brands net sales of the wholesale operations segment . |
Basis of Presentation - Textual
Basis of Presentation - Textuals (Details) - USD ($) $ in Thousands | Apr. 30, 2023 | Jan. 31, 2023 | May 31, 2022 | May 30, 2022 | Apr. 30, 2022 | Jan. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||||||
Cumulative effect of adoption of ASC | $ 1,380,447 | $ 1,385,448 | $ 1,558,292 | $ 1,519,912 | ||
Retained Earnings | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Cumulative effect of adoption of ASC | $ 987,180 | $ 983,944 | $ 1,147,639 | $ 1,117,005 | ||
Fabco Holding B.V. [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percent | 75% | |||||
Karl Lagerfeld Holding B.V. ("KLH") | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percent | 19% | |||||
KL North America B.V. [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percent | 49% | |||||
Karl Lagerfeld Holding B.V. ("KLH") | KL North America B.V. [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percent | 51% | |||||
Karl Lagerfeld Holding B.V. [Member] | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Remaining percentage of interest | 81% | |||||
Karl Lagerfeld Holding B.V. [Member] | Karl Lagerfeld Holding B.V. ("KLH") | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Remaining percentage of interest | 81% | |||||
Karl Lagerfeld Holding B.V. [Member] | Karl Lagerfeld Holding B.V. ("KLH") | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Ownership percent | 19% |
ALLOWANCE FOR DOUBTFUL ACCOUN_3
ALLOWANCE FOR DOUBTFUL ACCOUNTS (Narrative) (Details) | 3 Months Ended |
Apr. 30, 2023 segment | |
ALLOWANCE FOR DOUBTFUL ACCOUNTS | |
Number of reportable segments | 2 |
ALLOWANCE FOR DOUBTFUL ACCOUN_4
ALLOWANCE FOR DOUBTFUL ACCOUNTS (Accounts Receivable and Allowance for Doubtful Accounts) (Details) - USD ($) $ in Thousands | Apr. 30, 2023 | Jan. 31, 2023 | Apr. 30, 2022 | Jan. 31, 2022 |
Segment Reporting Information [Line Items] | ||||
Accounts receivable, gross | $ 513,433 | $ 693,260 | $ 590,552 | |
Allowance for doubtful accounts | (18,832) | (18,297) | (16,939) | $ (17,391) |
Accounts receivable, net | 494,601 | 674,963 | 573,613 | |
Wholesale operations | ||||
Segment Reporting Information [Line Items] | ||||
Accounts receivable, gross | 512,315 | 692,033 | 589,233 | |
Allowance for doubtful accounts | (18,769) | (18,237) | (16,858) | (17,307) |
Accounts receivable, net | 493,546 | 673,796 | 572,375 | |
Retail | ||||
Segment Reporting Information [Line Items] | ||||
Accounts receivable, gross | 1,118 | 1,227 | 1,319 | |
Allowance for doubtful accounts | (63) | (60) | (81) | $ (84) |
Accounts receivable, net | $ 1,055 | $ 1,167 | $ 1,238 |
ALLOWANCE FOR DOUBTFUL ACCOUN_5
ALLOWANCE FOR DOUBTFUL ACCOUNTS (Activity in Allowance for Credit Losses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | Jan. 31, 2023 | |
Segment Reporting Information [Line Items] | |||
Beginning balance | $ (18,297) | $ (17,391) | $ (17,391) |
Provision for credit losses | (535) | 414 | (978) |
Accounts written off as uncollectible | 38 | 72 | |
Ending balance | (18,832) | (16,939) | (18,297) |
Wholesale operations | |||
Segment Reporting Information [Line Items] | |||
Beginning balance | (18,237) | (17,307) | (17,307) |
Provision for credit losses | (532) | 411 | (1,002) |
Accounts written off as uncollectible | 38 | 72 | |
Ending balance | (18,769) | (16,858) | (18,237) |
Retail | |||
Segment Reporting Information [Line Items] | |||
Beginning balance | (60) | (84) | (84) |
Provision for credit losses | (3) | 3 | 24 |
Ending balance | $ (63) | $ (81) | $ (60) |
INVENTORIES - Textuals (Details
INVENTORIES - Textuals (Details) - USD ($) $ in Millions | Apr. 30, 2023 | Jan. 31, 2023 | Apr. 30, 2022 |
Inventory [Line Items] | |||
Inventory held on consignment | $ 7.6 | $ 6.6 | $ 5.9 |
Prepaid Expenses and Other Current Assets | |||
Inventory [Line Items] | |||
Inventory return asset | $ 12.9 | $ 19.2 | $ 16.4 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Apr. 30, 2023 | Jan. 31, 2023 | Apr. 30, 2022 |
Level 1 | Secured notes | |||
Debt Instrument [Line Items] | |||
Debt instruments, carrying value | $ 400,000 | $ 400,000 | $ 400,000 |
Debt instruments, fair value | 376,000 | 380,000 | 416,000 |
Level 2 | Revolving credit facility | |||
Debt Instrument [Line Items] | |||
Debt instruments, carrying value | 80,087 | ||
Debt instruments, fair value | 80,087 | ||
Level 2 | Unsecured Loan | |||
Debt Instrument [Line Items] | |||
Debt instruments, carrying value | 11,212 | 10,866 | 7,845 |
Debt instruments, fair value | 11,212 | 10,866 | 7,845 |
Level 2 | Overdraft facilities | |||
Debt Instrument [Line Items] | |||
Debt instruments, carrying value | 4,132 | 3,657 | 3,131 |
Debt instruments, fair value | 4,132 | 3,657 | 3,131 |
Level 2 | Foreign credit facility | |||
Debt Instrument [Line Items] | |||
Debt instruments, carrying value | 8,462 | 7,792 | |
Debt instruments, fair value | 8,462 | 7,792 | |
Level 3 | LVMH Note | |||
Debt Instrument [Line Items] | |||
Debt instruments, carrying value | 123,019 | 121,202 | 115,926 |
Debt instruments, fair value | $ 121,476 | $ 119,426 | $ 112,306 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Textuals (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jan. 31, 2023 | Apr. 30, 2023 | |
Debt Instrument [Line Items] | ||
Impairment of the operating lease assets, net of tax | $ 2.7 | |
LVMH Note | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 2% | |
Debt Instrument, Face Amount | $ 125 | |
Debt discount | $ 40 |
LEASES (Details)
LEASES (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | Jan. 31, 2023 | |
Lessee, Operating Lease, Description [Abstract] | |||
Option to extend | true | ||
Lessee, operating lease, option to terminate | The exercise of lease renewal options is generally at the Company’s sole discretion. The exercise of lease termination options is generally by mutual agreement between the Company and the lessor. | ||
Variable lease costs and short-term lease costs including rent forgiveness | $ 5.9 | $ 5.1 | |
Impairment charge related to the operating lease assets | $ 2.7 | ||
Minimum | |||
Lessee, Operating Lease, Description [Abstract] | |||
Operating lease, contract term | 1 year | ||
Renewal term | 1 year | ||
Maximum | |||
Lessee, Operating Lease, Description [Abstract] | |||
Operating lease, contract term | 10 years | ||
Renewal term | 10 years |
LEASES - Lease assets and liabi
LEASES - Lease assets and liabilities (Details) - USD ($) $ in Thousands | Apr. 30, 2023 | Jan. 31, 2023 | Apr. 30, 2022 |
Assets and Liabilities, Lessee [Abstract] | |||
Operating lease assets | $ 237,056 | $ 239,665 | $ 164,607 |
Classification of operating lease assets | Operating lease assets | ||
Current operating lease liabilities | $ 51,024 | 52,917 | 41,112 |
Classification current operating lease liabilities | Current operating lease liabilities | ||
Noncurrent operating lease liabilities | $ 202,406 | 204,974 | 139,686 |
Classification of noncurrent operating liabilities | Noncurrent operating lease liabilities | ||
Total lease liabilities | $ 253,430 | $ 257,891 | $ 180,798 |
LEASES - Lease cost (Details)
LEASES - Lease cost (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | |
Selling, general and administrative expenses | ||
Lease, Cost [Abstract] | ||
Lease costs | $ 18.6 | $ 14.1 |
LEASES - Future minimum payment
LEASES - Future minimum payments under our operating lease (Details) - USD ($) $ in Thousands | Apr. 30, 2023 | Jan. 31, 2023 | Apr. 30, 2022 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | |||
2024 | $ 51,368 | ||
2025 | 67,036 | ||
2026 | 56,130 | ||
2027 | 45,065 | ||
2028 | 36,772 | ||
After 2028 | 57,057 | ||
Total lease payments | 313,428 | ||
Less: Interest | 59,998 | ||
Present value of lease liabilities | $ 253,430 | $ 257,891 | $ 180,798 |
LEASES - Other information (Det
LEASES - Other information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | |
LEASES [Abstract] | ||
Operating lease, lease not yet commenced, description | As of April 30, 2023, there are no material leases that are legally binding but have not yet commenced. | |
Weighted average remaining lease term | 5 years 4 months 24 days | |
Weighted average discount rate | 8% | |
Cash paid for amounts included in the measurement of operating lease liabilities | $ 21.2 | $ 15 |
Right-of-use assets obtained in exchange for lease obligations | $ 10.5 | $ 8.6 |
KARL LAGERFELD ACQUISITION (Det
KARL LAGERFELD ACQUISITION (Detail) - May 31, 2022 - Karl Lagerfeld Holding B.V. [Member] $ in Thousands, € in Millions | EUR (€) | USD ($) |
Business Acquisition [Line Items] | ||
Purchase price | $ 168,592 | |
Plus: cash acquired | 38,499 | |
Plus: aggregate adjustments to purchase price | 516 | |
Initial Purchase Price | 207,607 | |
Plus: fair value of prior minority ownership | 102,858 | |
Total consideration | $ 310,465 | |
Total consideration | € | € 193.4 |
KARL LAGERFELD ACQUISITION (Fai
KARL LAGERFELD ACQUISITION (Fair Value of Assets Acquired) (Details) - USD ($) $ in Thousands | May 31, 2022 | Apr. 30, 2022 |
Business Acquisition [Line Items] | ||
Goodwill | $ 261,727 | |
Karl Lagerfeld Holding B.V. [Member] | ||
Business Acquisition [Line Items] | ||
Cash and cash equivalents | $ 38,499 | |
Accounts receivable | 28,449 | |
Inventories | 33,489 | |
Prepaid income taxes | 1,100 | |
Prepaid expenses and other current assets | 3,347 | |
Property, plant and equipment | 11,545 | |
Operating lease assets | 55,753 | |
Goodwill | 84,336 | |
Deferred income taxes | 5,131 | |
Other long-term assets | 2,237 | |
Total assets acquired | 447,003 | |
Notes payable | 3,606 | |
Accounts payable | 9,175 | |
Accrued Expense | 15,261 | |
Operating lease liabilities | 58,942 | |
Income taxes payable | 2,099 | |
Deferred income taxes. | 42,222 | |
Other long-term liabilities | 5,233 | |
Total liabilities assumed | 136,538 | |
Total fair value of acquisition consideration | 310,465 | |
Karl Lagerfeld Holding B.V. [Member] | Trade Names [Member] | ||
Business Acquisition [Line Items] | ||
Intangible assets | 178,823 | |
Karl Lagerfeld Holding B.V. [Member] | Customer Relationships | ||
Business Acquisition [Line Items] | ||
Intangible assets | $ 4,294 |
KARL LAGERFELD ACQUISITION (Int
KARL LAGERFELD ACQUISITION (Intangible Assets Acquired) (Details) - Karl Lagerfeld Holding B.V. [Member] - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2023 | Jan. 31, 2022 | |
Business Acquisition [Line Items] | ||
Fair value | $ 183,117 | |
Weighted average amortization period | 0 years | |
Transaction cost | $ 5,600 | $ 5,600 |
Trade Names [Member] | ||
Business Acquisition [Line Items] | ||
Fair value | $ 178,823 | |
Weighted average amortization period | 0 years | |
Customer Relationships | ||
Business Acquisition [Line Items] | ||
Fair value | $ 4,294 | |
Weighted average amortization period | 8 years |
KARL LAGERFELD ACQUISITION - Te
KARL LAGERFELD ACQUISITION - Textual (Detail) $ in Thousands, € in Millions | 3 Months Ended | ||||
May 31, 2022 USD ($) | May 31, 2022 EUR (€) | Apr. 30, 2023 USD ($) | May 30, 2022 | Apr. 30, 2022 USD ($) | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 261,727 | ||||
Karl Lagerfeld Holding B.V. ("KLH") | |||||
Business Acquisition [Line Items] | |||||
Ownership percent | 19% | ||||
KL North America B.V. [Member] | |||||
Business Acquisition [Line Items] | |||||
Ownership percent | 49% | ||||
Karl Lagerfeld Holding B.V. [Member] | |||||
Business Acquisition [Line Items] | |||||
Remaining percentage of interest | 81% | ||||
Initial Purchase Price | $ 207,607 | ||||
Business combination, consideration transferred | € | € 193.4 | ||||
Recorded gain | 27,100 | ||||
Adjustment to assets in acquisition | $ 36,900 | ||||
Adjustment to liabilities in acquisition | $ 36,900 | ||||
Goodwill | $ 84,336 | ||||
Estimated Life | 15 years | ||||
Karl Lagerfeld Holding B.V. [Member] | Karl Lagerfeld Holding B.V. ("KLH") | |||||
Business Acquisition [Line Items] | |||||
Ownership percent | 19% | ||||
Karl Lagerfeld Holding B.V. [Member] | Karl Lagerfeld Holding B.V. ("KLH") | |||||
Business Acquisition [Line Items] | |||||
Remaining percentage of interest | 81% |
Net Income per Common Share - R
Net Income per Common Share - Reconciliation between basic and diluted net income per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | |
Net Income per Common Share | ||
Net income (loss) attributable to G-III Apparel Group, Ltd. | $ 3,236 | $ 30,634 |
Basic net income (loss) per share: | ||
Basic common shares | 46,286 | 48,016 |
Basic net income (loss) per share (in dollars per share) | $ 0.07 | $ 0.64 |
Diluted net income (loss) per share: | ||
Basic common shares | 46,286 | 48,016 |
Diluted restricted stock awards and stock options | 1,156 | 1,092 |
Diluted common shares | 47,442 | 49,108 |
Diluted net income (loss) per share (in dollars per share) | $ 0.07 | $ 0.62 |
Net Income per Common Share - T
Net Income per Common Share - Textuals (Details) - shares | 3 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | |
Net Income per Common Share | ||
Common stock excluded from the diluted net income per share calculation | 302,200 | 113,300 |
NOTES PAYABLE - Long-term debt
NOTES PAYABLE - Long-term debt (Details) $ in Thousands, € in Millions | Apr. 30, 2023 USD ($) | Apr. 30, 2023 EUR (€) | Jan. 31, 2023 USD ($) | Apr. 30, 2022 USD ($) |
Debt Instrument [Line Items] | ||||
Total | $ 403,586 | $ 483,840 | $ 516,828 | |
Long-term Debt | ||||
Debt Instrument [Line Items] | ||||
Subtotal | 548,806 | 627,402 | 535,976 | |
Less: Net debt issuance costs | (3,821) | (4,246) | (5,520) | |
Debt discount | (1,981) | (3,798) | (9,074) | |
Current portion of long-term debt | (139,418) | (135,518) | (4,554) | |
Secured notes | ||||
Debt Instrument [Line Items] | ||||
Debt issuance costs | 8,500 | |||
Secured notes | Long-term Debt | ||||
Debt Instrument [Line Items] | ||||
Subtotal | 400,000 | 400,000 | 400,000 | |
Revolving credit facility | ||||
Debt Instrument [Line Items] | ||||
Debt issuance costs | 3,600 | 4,000 | 5,200 | |
Revolving credit facility | Long-term Debt | ||||
Debt Instrument [Line Items] | ||||
Subtotal | 80,087 | |||
LVMH Note | ||||
Debt Instrument [Line Items] | ||||
Debt discount | (40,000) | |||
LVMH Note | Long-term Debt | ||||
Debt Instrument [Line Items] | ||||
Subtotal | 125,000 | 125,000 | 125,000 | |
Unsecured Loan | ||||
Debt Instrument [Line Items] | ||||
Total | 11,200 | € 10.3 | ||
Unsecured Loan | Long-term Debt | ||||
Debt Instrument [Line Items] | ||||
Subtotal | 11,212 | 10,866 | 7,845 | |
Overdraft facilities | Long-term Debt | ||||
Debt Instrument [Line Items] | ||||
Subtotal | 4,132 | 3,657 | $ 3,131 | |
Foreign credit facility | Long-term Debt | ||||
Debt Instrument [Line Items] | ||||
Subtotal | $ 8,462 | $ 7,792 |
NOTES PAYABLE - Textuals (Detai
NOTES PAYABLE - Textuals (Details) $ in Thousands, € in Millions, SFr in Millions | 1 Months Ended | 3 Months Ended | 33 Months Ended | ||||||
Aug. 06, 2020 USD ($) | Aug. 31, 2020 USD ($) | Apr. 30, 2023 EUR (€) | Apr. 30, 2023 USD ($) | Apr. 30, 2023 EUR (€) | Apr. 30, 2023 CHF (SFr) | Jan. 31, 2023 USD ($) | Apr. 30, 2022 USD ($) | Aug. 07, 2020 USD ($) | |
Debt Instrument [Line Items] | |||||||||
Outstanding amount | $ 403,586 | $ 483,840 | $ 516,828 | ||||||
Unamortized debt issuance costs | $ 3,300 | ||||||||
Interest expense | $ 400 | ||||||||
Term Loan [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Prepayment of principal amount | $ 300,000 | ||||||||
Long-term Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt discount | $ 1,981 | 3,798 | 9,074 | ||||||
Secured notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate terms | The Notes bear interest at a rate of 7.875% per year payable semi-annually in arrears on February 15 and August 15 of each year. | ||||||||
Debt instrument interest rate | 7.875% | 7.875% | 7.875% | 7.875% | |||||
Frequency of periodic payment | semi-annually | ||||||||
Principal amount of debt | $ 400,000 | ||||||||
Debt issuance costs | $ 8,500 | ||||||||
Secured notes | If Company experiences a Change of Control [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Redemption percentage | 101% | ||||||||
Revolving credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt issuance costs | $ 3,600 | $ 4,000 | $ 5,200 | ||||||
LVMH Note | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt instrument interest rate | 2% | 2% | 2% | ||||||
Principal amount of debt | $ 125,000 | ||||||||
Debt discount | 40,000 | ||||||||
LVMH Note | Notes Payable Due On June 1 2023 | |||||||||
Debt Instrument [Line Items] | |||||||||
Principal amount of debt | 75,000 | ||||||||
Maturity date | Jun. 01, 2023 | ||||||||
Unsecured Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Outstanding amount | $ 11,200 | € 10.3 | |||||||
Installment payments | € | € 0.6 | ||||||||
Overdraft facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Principal amount of debt | € 5 | SFr 4.7 | |||||||
Fixed rate | 1.75% | 1.75% | 1.75% | ||||||
Debt facility amount | $ 4,100 | € 3.8 | |||||||
Standby Letters of Credit | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowings outstanding | 2,900 | ||||||||
Foreign credit facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing amount | € | 15 | ||||||||
Borrowings outstanding | 8,500 | € 7.8 | |||||||
Foreign credit facility | Euro Interbank Offered Rate [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Variable rate spread | 1.70% | ||||||||
Trade | |||||||||
Debt Instrument [Line Items] | |||||||||
Borrowings outstanding | $ 7,800 | ||||||||
Minimum | Unsecured Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Fixed rate | 0% | 0% | 0% | ||||||
Minimum | Overdraft facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Variable interest rate | 0% | 0% | 0% | ||||||
Maximum | Unsecured Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Fixed rate | 5% | 5% | 5% | ||||||
Maximum | Overdraft facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Variable interest rate | 0.50% | 0.50% | 0.50% |
NOTES PAYABLE - Second Amended
NOTES PAYABLE - Second Amended and Restated ABL Credit Agreement (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Apr. 30, 2022 | Aug. 07, 2020 | Apr. 30, 2023 | Jan. 31, 2023 | |
Debt Instrument [Line Items] | ||||
Outstanding amount | $ 516,828 | $ 403,586 | $ 483,840 | |
Secured Overnight Financing Rate SOFR Overnight Index Swap Rate One-Month Interest Period [Member] | ||||
Debt Instrument [Line Items] | ||||
Spread interest rate | 1% | |||
Second amended and restated credit agreement | ||||
Debt Instrument [Line Items] | ||||
Weighted average interest rate | 6.62% | |||
Second amended and restated credit agreement | Maximum | ||||
Debt Instrument [Line Items] | ||||
Debt instrument commitment fee percentage | 0.50% | |||
Second amended and restated credit agreement | Minimum | ||||
Debt Instrument [Line Items] | ||||
Debt instrument commitment fee percentage | 0.35% | |||
Second amended and restated credit agreement | Prime rate | ||||
Debt Instrument [Line Items] | ||||
Spread interest rate | 0.50% | |||
Second amended and restated credit agreement | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||
Debt Instrument [Line Items] | ||||
Spread interest rate | 0.10% | |||
Senior secured credit facility | ||||
Debt Instrument [Line Items] | ||||
Debt issuance costs | $ 8,000 | |||
Senior secured credit facility | One-month LIBOR | ||||
Debt Instrument [Line Items] | ||||
Spread interest rate | 1% | |||
Senior secured credit facility | Federal funds rate | ||||
Debt Instrument [Line Items] | ||||
Spread interest rate | 0.50% | |||
Senior secured credit facility | Second amended and restated credit agreement | ||||
Debt Instrument [Line Items] | ||||
Term of credit agreement | 5 years | |||
Senior secured credit facility | $ 650,000 | |||
Fixed charge coverage ratio | 1% | |||
Credit covenant compliance | As of April 30, 2023, the Company was in compliance with these covenants. | |||
Debt issuance costs | $ 5,100 | |||
Senior secured credit facility | Second amended and restated credit agreement | Base rate | Maximum | ||||
Debt Instrument [Line Items] | ||||
Spread interest rate | 1.25% | |||
Senior secured credit facility | Second amended and restated credit agreement | Base rate | Minimum | ||||
Debt Instrument [Line Items] | ||||
Spread interest rate | 0.75% | |||
Senior secured credit facility | Second amended and restated credit agreement | LIBOR plus | Maximum | ||||
Debt Instrument [Line Items] | ||||
Spread interest rate | 2.25% | |||
Senior secured credit facility | Second amended and restated credit agreement | LIBOR plus | Minimum | ||||
Debt Instrument [Line Items] | ||||
Spread interest rate | 1.75% | |||
Term Loan | Senior secured credit facility | Second amended and restated credit agreement | ||||
Debt Instrument [Line Items] | ||||
Senior secured credit facility | $ 650,000 |
REVENUE RECOGNITION - Textuals
REVENUE RECOGNITION - Textuals (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Apr. 30, 2023 | Apr. 30, 2022 | Jan. 31, 2023 | |
REVENUE RECOGNITION [Abstract] | |||
Contract liability | $ 4,100 | $ 3,600 | $ 5,100 |
Customer refund liabilities | (69,408) | (78,052) | (89,760) |
Revenue recognized related to contract liabilities | 3,600 | 3,700 | |
Contract assets | $ 0 | $ 0 | $ 0 |
SEGMENTS - Information Regardin
SEGMENTS - Information Regarding Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | |
Segment Reporting Information [Line Items] | ||
Net sales | $ 606,589 | $ 688,757 |
Cost of goods sold | 356,788 | 442,718 |
Gross profit | 249,801 | 246,039 |
Selling, general and administrative expenses | 227,961 | 185,407 |
Depreciation and amortization | 6,576 | 6,095 |
Operating profit (loss) | 15,264 | 54,537 |
Operating Segments | Wholesale operations | ||
Segment Reporting Information [Line Items] | ||
Net sales | 586,903 | 680,904 |
Cost of goods sold | 352,470 | 448,769 |
Gross profit | 234,433 | 232,135 |
Selling, general and administrative expenses | 204,089 | 161,808 |
Depreciation and amortization | 5,745 | 5,414 |
Operating profit (loss) | 24,599 | 64,913 |
Operating Segments | Retail | ||
Segment Reporting Information [Line Items] | ||
Net sales | 30,217 | 27,885 |
Cost of goods sold | 14,849 | 13,981 |
Gross profit | 15,368 | 13,904 |
Selling, general and administrative expenses | 23,872 | 23,599 |
Depreciation and amortization | 831 | 681 |
Operating profit (loss) | (9,335) | (10,376) |
Elimination | ||
Segment Reporting Information [Line Items] | ||
Net sales | (10,531) | (20,032) |
Cost of goods sold | $ (10,531) | $ (20,032) |
SEGMENTS - Schedule of Total Ne
SEGMENTS - Schedule of Total Net Sales by Licensed and Proprietary Product Sales (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | |
Segment Reporting Information [Line Items] | ||
Net sales | $ 606,589 | $ 688,757 |
Elimination | ||
Segment Reporting Information [Line Items] | ||
Net sales | (10,531) | (20,032) |
Wholesale operations | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Net sales | 586,903 | 680,904 |
Wholesale operations | Operating Segments | Licensed Brands [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 298,005 | 459,984 |
Wholesale operations | Operating Segments | Proprietary Brands [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 288,898 | 220,920 |
Retail | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Net sales | 30,217 | 27,885 |
Retail | Operating Segments | Licensed Brands [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 13,928 | |
Retail | Operating Segments | Proprietary Brands [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | $ 30,217 | $ 13,957 |
SEGMENTS - Method of Overhead A
SEGMENTS - Method of Overhead Allocation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | |
SEGMENTS [Abstract] | ||
Revenues | $ 606,589 | $ 688,757 |
STOCKHOLDERS' EQUITY - Textuals
STOCKHOLDERS' EQUITY - Textuals (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2022 | |
STOCKHOLDERS' EQUITY, [Abstract] | ||
Common stock, shares issued | 0 | 0 |
Treasury stock, shares utilized of equity awards | 2,001 | 271,536 |
Aggregate purchase price | $ 16,769 |
Canadian Customs Duty Examina_2
Canadian Customs Duty Examination - Canadian Customs Duty Examination - (Details) - Apr. 30, 2023 $ in Millions, $ in Millions | CAD ($) | USD ($) |
Canadian Customs Duty Examination [Line Items] | ||
Income tax receivable | $ 13.3 | $ 9.8 |
CBSA | ||
Canadian Customs Duty Examination [Line Items] | ||
Refund received | $ 1.5 | $ 1.1 |
Subsequent Events (Details)
Subsequent Events (Details) - License Agreements | 1 Months Ended |
May 31, 2023 | |
Subsequent Event [Line Items] | |
Intangible assets, estimated useful lives | 20 years |
Subsequent Event | |
Subsequent Event [Line Items] | |
Purchase option, minimum period of license agreement | 25 years |
Subsequent Event | Minimum | |
Subsequent Event [Line Items] | |
Intangible assets, estimated useful lives | 5 years |
Subsequent Event | Maximum | |
Subsequent Event [Line Items] | |
Intangible assets, estimated useful lives | 25 years |