Michael Kors boosted by improved results
Michael Kors has achieved better than expected retail sales in North America and Europe in its first quarter.
In the three months to 1 July, revenue decline by 3.6% to $952.4 million. On a constant currency basis, total revenue fell by 2.6%.
Retail net sales increased by 10.1% to $619.9 million with the growth mainly driven by 67 net new store openings and the impact of the company’s acquisition of its Greater China license.
Comparable sales dropped by 5.9%. On a constant currency basis, retail net sales rose by 11.6%, and comparable sales decreased by 4.9%.
Gross profit fell by 2.8% to $574.7 million, and as a percentage of total revenue was 60.3%.
John Idol, Michael Kors chairman and chief executive, said, “Our first quarter performance exceeded our expectations, driven largely by better than anticipated retail comparable sales results in both North America and Europe.
“We are encouraged by our first quarter performance, although we continue to believe that fiscal 2018 will be a transition year for our company, as we focus on laying the foundation for the future by executing on our strategic plan, Runway 2020.
“While it is still early in the process, we are making meaningful progress enhancing our assortments, deepening our connection with consumers, and elevating our jet set luxury experience in our stores and digital flagships."
As of 1 July, the company operated 838 retail stores, including concessions, compared to 771 retail stores, including concessions, at the end of the same prior-year period. The company had 141 additional retail stores, including concessions, operated through licensing partners. Including licensed locations, there were 979 Michael Korsstores worldwide at the end of the period.
Last month, Michael Kors announced that it has agreed to acquire the Jimmy Choo luxury footwear brand.
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