Investors Bullish on PVH After Costly Calvin Klein Miss

PVH Corp. put the message out loud and clear this week that there are tentative signs that its quick work to fix the mistakes at Calvin Klein are beginning to take hold. “I’m pleased to report that Calvin Klein’s performance in the fourth quarter exceeded our revised expectations,” said Emanuel Chirico, chairman and chief executive officer of PVH, on a call with investors Thursday morning. “Calvin Klein’s brand health remained very strong despite some of the business challenges we faced in 2018.” The “business challenge” he was referring to was an unexpected fallout in its prized Calvin Klein business, the extent of which was revealed when third-quarter earnings were released in early December. Call it a $190 million lesson. The problem was designer Raf Simons’ high-concept overhaul of CK Jeans, which failed to connect with consumers, while his runway collection, dubbed 205W39NYC, was not returning on the tens of millions of dollars PVH had plowed into it. Calvin Klein’s financial results said it all. Earnings before interest and taxes in the third quarter decreased to $121 million from $142 million a year earlier, which the company said was “primarily attributable to an approximately $10 million increase in creative and marketing expenditures compared to the prior-year

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