Kontoor Brands ( NYSE: KTB ) dipped in early trading on Thursday after a slight miss with the company's Q3 revenue tally.
Revenue fell 7% during the quarter or -5% on a constant currency basis.
KTB said sell-in was adversely impacted and global revenue tempered as U.S. retailer inventory rebalancing efforts and COVID-related lockdowns in China continued.
Challenges in domestic wholesale and China were somewhat offset by continued strength in Digital own.com, as well as gains in the EMEA region. U.S. revenue was down 8% during the quarter, with reductions in both the Wrangler and Lee brands. Lower shipments due to retailer inventory rebalancing weighed on U.S. wholesale, which was down 9%.
Mix benefits, strategic pricing, and tight expense controls were noted to have helped to offset inflationary pressures and bring in EPS ahead of expectations.
Guidance: Full-year revenue is now expected to increase approximately 4% vs. prior guidance of up approximately 6% and +3.2% consensus, gross margin is now expected to approximate 43%, adjusted EPS is expected to be in the range of $4.35 to $4.40 vs. prior guidance of $4.40 to $4.50 and consensus of $4.09, capital Expenditures are expected to be in the range of $30M to $35M.
Shares of Kontoor Brands ( KTB ) fell 0.77% following the mixed earnings report.
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Kontoor Brands falls slightly after retail inventory rebalancing impacts results