Ralph Lauren sales, profit beat expectations as turnaround gains ground

5/23/2018
Ralph Lauren reported better-than-expected results for its fourth quarter amid the company’s ongoing shift to reduce its department store distribution and sell more products at full-price.

Ralph Lauren reported net income of $41.3 million, or 50 cents per share, in the quarter ended March 31, compared with a loss of $204 million, or $2.48 per share, in the year-ago period during which it incurred $322 million in restructuring charges. Excluding items, earnings per share came in at 90 cents, higher than the 83 cents per share that analysts had expected.

Net revenue fell 2 % to $1.53 billion, but was above analysts’ estimates of $1.48 billion. Same-store sales on a constant currency basis fell 1%, not as bad as expected.

Ralph Lauren said its average unit retail across its direct-to-consumer network was up 4% for the full year, with growth in every quarter, while discount rates were down across all regions and all channels. The company said it continued to close unproductive distribution and reduce off-price penetration within wholesale, during the same period, and began to upgrade its store environments.

“We delivered on our commitments for the fourth quarter and full year, and we made strong operational progress,” said Patrice Louvet, president and CEO. “We start the new year with a solid foundation – including a clear strategic plan to deliver long-term growth and value creation, an engaged global organization, and a strong balance sheet.”
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