(Source: AP,Dailysabah.com | June 1, 2017)
Michael Kors Holdings plans to close up to 125 stores over the next two years with continued weak sales at its luxury stores.
The London company also issues a weak outlook and comparable store sales were disappointing. The retailer lost $26.8 million, or 17 cents per share, after reporting a profit in the same period a year earlier. Earnings, adjusted for asset impairment costs, were 73 cents per share.
The results topped Wall Street expectations by 3 cents, according to a survey by Zacks Investment Research. Revenue fell 11.2 percent to $1.06 billion, but that too edged out expectations. Sales in the Americas region, which makes up the bulk of revenue, fell 18 percent to $721 million. Same-store sales, a key measure of a retailer’s health, fell 14.1 percent, which was worse than Wall Street had expected.
“Fiscal 2017 was a challenging year, as we continued to operate in a difficult retail environment with elevated promotional levels,” said Chairman and CEO John D. Idol.
He said the company needs to take further steps to elevate “the level of fashion innovation” and enhance the store experience. For the year, the company reported profit of $552.5 million, or $3.29 per share. Revenue was reported as $4.49 billion. The company expects full-year earnings to be $3.57 to $3.67 per share, with revenue expected to be $4.25 billion.