• Q2 net income down 4% to $205m
  • Revenues climbed 3% to $1.9bn
  • Retail sales rose 5% to $944m
Revenues climbed 3% to $1.9bn during the second quarter

Revenues climbed 3% to $1.9bn during the second quarter

US-based apparel business Ralph Lauren Inc has reported a decline in second-quarter profits after lower margins offset revenue growth, but lifted its full-year sales guidance. 

The company's net income reached $205m during the three months to 28 September, down 4% on $214m in the same period of last year.

Revenues climbed 3% to $1.9bn from $1.8m in the prior year. Retail sales rose 5% to $944m, while comparable store sales edged down 1%. Wholesale revenue was up 1% to $928m, but licensing revenue fell 6% to $43m during the period.

Gross margin declined 220 basis points to 56.6%, primarily due to unfavourable foreign currency dynamics, the mix impact from the integration of the Chaps men's sportswear operations and lower profits from concession stores. 

"We made excellent progress on several key initiatives during the second quarter," said president and COO Jacki Nemerov. "We successfully transitioned key operations to new technology platforms and made great strides with our global store expansion and e-commerce efforts."

The company now expects full-year revenue to grow 5-7%, which is at the higher end of its earlier forecasts of 4-7%. During the third quarter, Ralph Lauren expects revenues to increase by 8-10%.

"We are confident that the investments we're making will support accelerated sales and profit growth in the second half of fiscal 2014," Nemerov added.