Kontoor Brands' Helly Hansen acquisition to boost EPS, long-term growth

Kontoor Brands, affirming its strong preliminary fourth-quarter results with 699 million dollars in revenue, a 4 percent increase, has presented an optimistic outlook for the year ahead, excluding the potential benefits of the Helly Hansen acquisition. Kontoor Brands acquired the outerwear brand for 900 million dollars from Canadian Tier Corporation.

The pending acquisition of Helly Hansen, a strategic move to diversify beyond denim into performance outerwear, is expected to contribute approximately 0.15 dollars to the full-year adjusted EPS, with significant accretion anticipated in 2026.

Industry analysts suggest that this 0.15 dollars EPS growth projection holds substantial long-term potential, particularly in international markets, despite the company's 1 percent revenue decline in those regions during the fourth quarter.

"The core strengths of our business remain intact, and the acquisition of Helly Hansen will further bolster our total shareholder return model, paving the way for enhanced value creation," stated Scott Baxter, president, CEO, and chairman. "While we acknowledge the prevailing economic uncertainties and will maintain a prudent approach to business management, we are confident in our ability to deliver strong shareholder returns in 2025 and beyond," Baxter added.

The company's 2025 forecast anticipates revenue ranging from 2.63 billion dollars to 2.69 billion dollars, reflecting a 1 percent to 3 percent growth compared to the previous year, driven by market share gains, channel and category expansion, wider distribution, and increased brand investment.

However, these growth catalysts are expected to be partially offset by cautious retailer inventory management and moderated consumer spending globally.

The company projects first-half revenue growth consistent with the full-year forecast, with second-quarter growth outpacing the first due to the timing of seasonal programs and new distribution gains. Adjusted EPS is projected to be between 5.20 dollars and 5.30 dollars, representing a 6 percent to 8 percent increase year-over-year.