US: Ralph Lauren ups FY sales forecast after Q3 profit
- Q3 profit up 10% to $237m
- Revenues rose 9% to $2bn
- Company increases FY revenue forecast
Revenues rose 9% to $2bn during the third quarter
Ralph Lauren has upped its full-year revenue forecast after posting a 10% increase in third-quarter net profit, but warned of lower margins.
Net income reached US$237m during the three months to 28 December, compared to $216m in the same period of the prior year.
Revenues, meanwhile, rose 9% to $2bn, with the Americas, Europe and Asia reporting at least high single-digit increases in constant currency. Retail sales were up 6% to $1.1bn, while comparable store sales climbed 1%.
Wholesale revenues grew 14% to $840m, but licensing sales fell 12% to $45m.
Gross margin declined 110 basis points to 58.2%, impacted by the integration of the Chaps men's wear operations, as well as unfavourable foreign currency dynamics.
The company now expects operating margin to be 110-120 basis points below the prior year's record 16.2%, compared to its prior outlook of a 75 basis points decline. Revenues are forecast to be in the high end of its earlier 5%-7% guidance.
Despite this, chairman and CEO Ralph Lauren said: "I am confident we have the right strategies to accomplish our goals and I couldn't be more optimistic about the prospects ahead."
"We set aggressive goals for the third quarter and we are proud to have achieved them in the context of such a challenging operating environment," said president and COO Jacki Nemerov.
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