Shares of Kontoor Brands experienced a decline following the company’s adjustment to its earnings and revenue forecast for 2023. The stock price saw an 8.1% decrease in early trading, reaching $41.82. However, despite this setback, shares remain up 5% year-to-date.
Revised Earnings and Revenue Expectations
Kontoor Brands, a clothing company, now anticipates adjusted earnings of $4.35 per share for the projected year, a downward revision from its prior estimate of $4.55 to $4.75 per share. The adjustment is primarily attributed to a charge of 15 cents per share resulting from duty expenses related to prior periods.
Moreover, rather than experiencing growth in the low single-digit range, Kontoor Brands now expects its revenue in 2023 to rise by a modest 1%.
Strong Third Quarter Performance
During the third quarter, Kontoor Brands reported a profit of $59.5 million, equivalent to $1.05 per share. This represents an improvement compared to $51.1 million, or 90 cents per share, during the same quarter in the previous year.
Furthermore, after excluding duty expenses from the calculations, adjusted earnings for the third quarter amounted to $1.22 per share. These results surpassed analyst forecasts of $1.19 per share, according to FactSet.
Exceeding Revenue Expectations
In addition to a strong profit performance, Kontoor Brands achieved an 8% increase in quarterly revenue, totaling $654.5 million. This figure exceeded analyst predictions of $640.2 million, as stated by FactSet.
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