US-based global luxury lifestyle brand Michael Kors Holdings Limited has announced results for the fourth quarter ended April 1, 2017. During the quarter under review, total revenue of the fashion retailer decreased 11.2 per cent to US $ 1.06 billion from US $ 1.20 billion in the fourth quarter of fiscal 2016.
In the reporting quarter, retail net sales increased by 7.4 to per cent US $ 2.57 billion. Comparable sales decreased 8.3 per cent. On a constant currency basis, retail net sales grew 7.8 per cent, and comparable sales decreased 8.1 per cent.
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Gross profit also plunged 4.9 per cent to US $ 2.66 billion, and as a percentage of total revenue was 59.2 per cent. Foreign currency translation and transaction unfavourably impacted gross profit margin by approximately 60 basis points. This compares to 59.4 per cent in the same period in fiscal 2016.
The company operated 827 retail stores, including concessions, compared to 668 retail stores, including concessions, at the end of the same prior-year period.
John D. Idol, Chairman & Chief Executive Officer of the company commented, “Fiscal 2017 was a challenging year, as we continued to operate in a difficult retail environment with elevated promotional levels. In addition, our product and store experience did not sufficiently engage and excite consumers. We acknowledge that we need to take further steps to elevate the level of fashion innovation in our accessories assortments and enhance our store experience in order to deepen consumer desire and demand for our products.”
Looking ahead, as the company expands the fashion innovation in its accessories assortments, right-size its store fleet and elevate store experience. Fiscal 2018 will be a transition year in which it will establish a new baseline before returning to long-term growth.
