Two retail-clothing rivals reported increases in quarterly earnings Wednesday, sending their shares higher in morning trading.

Polo Ralph Lauren

(RL) - Get Report

shares were gaining 86 cents, or 2.9%, to $30.91, after the company posted second-quarter earnings that beat analysts' consensus by a penny. Meanwhile, shares of

Tommy Hilfiger

(TOM)

were adding $1.05, or 7.3%, to $15.43 following its news that profit increased 6.1% and easily topped consensus.

On a generally accepted accounting basis, New York-based Polo Ralph Lauren said it earned $54 million, or 54 cents a share, compared with $51.7 million, or 52 cents a share, in the prior-year quarter.

On an adjusted basis, the company said it earned $52.9 million, or 52 cents a share, in the second quarter ended Sept. 27, compared with a profit of $51.9 million, or 52 cents a share, a year ago. Analysts were calling for 51 cents a share.

Total revenue increased 10.4% to $707.8 million. Polo Ralph Lauren reported an 8.3% increase in retail comps and said it had mid-to-high-teens retail sales comps at its Ralph Lauren and at its Club Monaco stores. Also, the company reported mid-single-digit sales comps at its outlet stores.

In the third quarter, Polo Ralph Lauren sees adjusted earnings of 44 cents to 49 cents a share, compared with Wall Street consensus of 45 cents a share. And in the fourth quarter, the company expects 75 cents to 80 cents a share. Consensus is 80 cents a share.

Looking to 2004, the company expects a profit of $1.75 to $1.85 a share, including certain items, with a sales increase in the "mid-single digits." Analysts expect $1.79 a share on sales of $2.59 billion.

Over at Tommy Hilfiger, net income in the second quarter ended Sept. 30 was $64.7 million, or 71 cents a share, from last year's earnings of $61 million, or 67 cents a share. Analysts were calling for 58 cents a share. Sales were $547.9 million, up slightly from last year's $546.5 million.

The company cited strong results in its European segment, helped by favorable currency rates. Sales jumped 58% to $152.5 million, which included $19.2 million because of the dollar's weakness against the euro in fiscal 2004.

Tommy Hilfiger also said interest expense was lower after it repaid $151.1 million of senior notes. It also repaid short-term borrowings.

On a slightly negative note, the company said markdowns and promotional pricing have characterized the market of late. Also, the company's chief executive, David F. Dyer, said: "I believe we are overdistributed in U.S. department stores and that we must continue to reduce distribution in order to bring supply and demand into balance."

During the quarter, Tommy Hilfiger, which is based in Hong Kong, said it had a high-single-digit decrease in comparable-store sales at U.S. outlet stores. Outside the U.S., comparable-store sales increased in the low to mid-single digits.

Looking to the third quarter, revenue is expected to fall 15% from last year's $477.3 million, as the company expects declines in the U.S. will be partially offset by growth in Europe. The company expects to earn 10 cents to 14 cents a share, within range of analysts' average estimate of 13 cents a share. Analysts have also forecast sales of $396.55 million.

In the fourth quarter, revenue is seen being even with or only slightly below last year's $498 million. Profit is seen at 35 cents to 39 cents a share. Wall Street is calling for earnings of 36 cents a share on sales of $467.54 million.

In 2004, the company sees earnings of $1.35 to $1.43 a share, which is ahead of analysts' current estimate of $1.18 a share. The company earned $1.40 a share in 2003.