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Capri Holdings Limited announces financial results

Capri Holdings

Capri Holdings Limited, a global fashion luxury group, reported an increase of 17 percent in revenue, with better than anticipated results across all three luxury houses for its second quarter of Fiscal 2022 ended 25th September, 2021.

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John D. Idol, the Company’s Chairman and Chief Executive Officer, said, “We are pleased with our second quarter results with revenue, gross margin, operating margin and earnings per share all exceeding our expectations. This performance reflects the power of Versace, Jimmy Choo and Michael Kors as well as the execution of our strategic initiatives. Capri Holdings strong results are a testament to the dedication, resilience and agility of the entire team across the globe.”

Mr. Idol continued, “We remain confident in the strength of our luxury houses and are pleased to be raising revenue and earnings guidance for the year. Our new outlook reflects both stronger revenue performance as well as greater than anticipated gross margin expansion driven by the execution of our strategic initiatives. The success of these initiatives is currently offsetting the COVID-19 related industry headwinds including supply chain delays and increased transportation costs. Looking forward as the world continues to recover from the impact of the global pandemic, we remain confident in the growth opportunities for Versace, Jimmy Choo and Michael Kors. As we execute on our strategic initiatives, Capri Holdings is positioned to deliver multiple years of revenue and earnings growth.”

In the second quarter fiscal 2022, Capri Holdings reported total revenue of US$1.3 billion increased 17 percent compared to last year. On a constant currency basis, total revenue increased 15 percent.

Gross profit was US$884 million and gross margin was 68.0 percent, compared to US$710 million and 64.0 percent in the prior year. Adjusted gross profit was US$879 million and adjusted gross margin was 67.6 percent, compared to US$701 million and 63.2 percent in the prior year.

Income from operations was US$195 million and operating margin was 15.0 percent, compared to US$153 million and operating margin of 13.8 percent in the prior year. Adjusted income from operations was US$241 million and operating margin was 18.5 percent, compared to US$182 million and operating margin of 16.4 percent in the prior year.

Net income was US$200 million, or US$1.30 per diluted share, compared to US$122 million, or US$0.81 per share, in the prior year. Adjusted net income was US$235 million, or US$1.53 per diluted share, compared to US$137 million or, US$0.90 per diluted share, in the prior year.

Net inventory at 25th September, 2021 was US$866 million, a 6.9 percent decrease compared to the prior year.

Versace revenue of $282 million increased 45 percent compared to the prior year. On a constant currency basis, total revenue increased 43 percent. Versace operating income was US$55 million and operating margin was 19.5 percent compared to US$20 million and operating margin of 10.3 percent in the prior year.

Jimmy Choo revenue of US$137 million increased 12 percent compared to the prior year. On a constant currency basis, total revenue increased 5 percent. Jimmy Choo operating income was US$1 million and operating margin was 0.7 percent, compared to break even in the prior year.

Michael Kors revenue of US$881 million increased 11 percent compared to the prior year. On a constant currency basis, total revenue increased 10 percent. Michael Kors operating income was US$220 million and operating margin was 25.0 percent, compared to US$190 million and operating margin of 24.0 percent in the prior year.

During the second quarter, the Company repurchased approximately 1.8 million ordinary shares for approximately US$100 million in open market transactions.

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The Company’s Board of Directors approved a new share repurchase program of up to US$1 billion of its outstanding ordinary shares, providing additional capacity to return cash to shareholders over the longer term. This new two-year program will replace the Company’s existing US$500 million share repurchase program which had US$250 million of availability remaining.