Why Wrangler & Lee Parent Kontoor Brands (KTB) Is Jumping Today - Kontoor Brands (NYSE:KTB)

Kontoor Brands, Inc. KTB reported fourth-quarter FY22 sales growth of 7% year-on-year to $731.61 million, beating the consensus of $668.8 million.
The company attributed the sales growth to strength in domestic wholesale and Digital, somewhat offset by decreases in International with the continued impacts of lockdowns and restrictions in China weighing on the quarter.
Revenue in the U.S. increased 16% Y/Y, and International revenue fell 20%.
Global revenue from the Wrangler brand increased 15% Y/Y, and the Lee brand dropped 6%.
Adjusted EPS of $0.88 beat the consensus of $0.67.
Gross profit margin for the quarter contracted 200 basis points Y/Y to 40.8%. The operating margin expanded 150 basis points to 11.6%, and operating income for the quarter rose 23% to $84.6 million.
Kontoor Brands held $59.2 million in cash and equivalents as of December 2022. Cash provided by operating activities for the year totaled $83.6 million.
Inventories at the end of FY22 climbed 64% Y/Y to $597 million. The company said it is taking proactive actions and expects inventory to return to more normalized levels in mid-2023.
Outlook: Kontoor Brands expects FY23 revenue to increase at a low-single-digit percentage compared to FY22.
The company sees FY23 EPS of $4.55 - $4.75 against the consensus of $4.36.
Price Action: KTB shares are trading higher by 11.49% at $48.50 in premarket on the last check Tuesday.
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Why Wrangler & Lee Parent Kontoor Brands Is Jumping Today