Total revenue for the quarter ended March 2026, including discontinued operations, stood at $808 million. Revenue from continuing operations reached $613 million, supported by 4 per cent growth in Wrangler and 16 per cent growth in Helly Hansen on a pro-forma basis.
“Our strong first quarter results reflect the power of our operating model combined with strong execution,” said Scott Baxter, president, chief executive officer and chairman of Kontoor Brands. “Wrangler drove another quarter of broad-based growth and market share gains, and Helly Hansen delivered better-than-expected revenue and profitability.”
Kontoor Brands has posted stronger-than-expected Q1 FY26 results, driven by growth in Wrangler and Helly Hansen, and raised its full-year outlook.
Total revenue reached $808 million, while continuing operations generated $613 million.
The company plans to divest Lee, now treated as a discontinued operation.
Adjusted EPS guidance was raised to $6.6-6.7 for FY26.
Brand-wise, Wrangler global revenue increased 4 per cent year-on-year (YoY) to $436 million. Wrangler US revenue rose 1 per cent, aided by a 6 per cent rise in direct-to-consumer sales and a 1 per cent increase in wholesale revenue. International Wrangler revenue climbed 20 per cent, driven by strong direct-to-consumer and wholesale growth.
Helly Hansen generated $176 million in global revenue during the quarter, with sport and workwear segments contributing $120 million and $45 million respectively.
The gross margin from continuing operations on a reported basis improved 810 basis points to 53.7 per cent. Adjusted gross margin increased 470 basis points to 50.6 per cent, driven by the contribution from Helly Hansen, channel mix improvements and benefits from Project Jeanius, Kontoor Brands said in a press release.
Adjusted operating income from continuing operations rose 60 per cent YoY to $87 million, while adjusted earnings per share (EPS) from continuing operations reached $1.06. Total reported EPS, including discontinued operations, stood at $1.65.
The company said the Lee business is now being treated as discontinued operations after initiating a competitive divestiture process during Q1 2026. Kontoor expects to sign a definitive agreement for the sale in 2026, with multiple parties reportedly showing interest.
At the end of the quarter, Kontoor held $56 million in cash and cash equivalents and $1.14 billion in long-term debt. Inventory stood at $464 million, including Helly Hansen inventory.
The company additionally disclosed that it recognised a net receivable of $54 million linked to the expected recovery of tariffs previously paid under the US International Emergency Economic Powers Act (IEEPA), following a recent court ruling against the tariffs.
Raises FY26 Outlook
The company has raised its FY26 revenue outlook, including discontinued operations, to $3.41-3.46 billion from the earlier guidance of $3.40-3.45 billion. Revenue from continuing operations is expected between $2.66 billion and $2.71 billion.
Adjusted EPS guidance, including discontinued operations, has been revised upwards to $6.6-6.7 from the previous $6.4-6.5 range. Adjusted EPS from continuing operations is expected between $5.15 and $5.25.
“Our updated outlook reflects better than expected first quarter results and improving visibility for Wrangler and Helly Hansen,” said Joe Alkire, executive vice president, chief financial officer and global head of operations at Kontoor Brands.
Fibre2Fashion News Desk (SG)
