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Capri Holdings posts revenue decline

Feb 12, 2023 United Kingdom
Capri Holdings posts revenue decline
The fashion group, which owns Versace, Michael Kors and Jimmy Choo, posted a revenue decline of 6.0% in the third quarter of fiscal 2023, as compared to the same period of last fiscal year
"Overall, our performance in the third quarter was more challenging than anticipated. However, many aspects of our business performed well, in particular we were pleased with the continued growth in our own retail channel across all three of our luxury houses", commented John D. Idol, the Company's Chairman and Chief Executive Officer. "However, we were disappointed with the performance of our global wholesale business in the quarter which resulted in expense deleverage and a lower operating margin. We have begun taking measures to better align operating expenses with the change in revenue by channel. At the same time, we will continue to make strategic investments to drive long-term growth", he added.


Third Quarter Results

In the third quarter of the current fiscal year, Capri Holdings' revenue amounted to 1.15 billion US dollars, which reflects a decrease of 6.0% on a comparable basis to the same period of fiscal 2022; on a constant currency basis, total revenue dropped by 0.6%.

The company reported that net income in the mentioned period totalled 225 million US dollars, or 1.72 US dollars per diluted share, as compared to the net income of 322 million US dollars, or 2.11 US dollars per diluted share, recorded in the same quarter of the prior fiscal year. Accordingly, the adjusted net income was 240 million US dollars, or 1.84 US dollars per diluted share, as compared to the adjusted net income of 339 million US dollars, or 2.2 US dollars per diluted share registered in the third quarter of the last fiscal year.

Versace

In the three months to the 31st of December 2022, Versace's revenue reached 249 million US dollars, down by 0.8%, as compared to the same period of the previous year; on a constant currency basis, it rose by 11.2%. The brand's operating income in this period was 24 million US dollars and operating margin corresponded to 9.6%, on a comparable basis to the operating income of 32 million US dollars and the operating margin of 12.7% posted in the same quarter of fiscal 2022.  

Jimmy Choo

Jimmy Choo's revenue declined by 5.6% in the third quarter of the current fiscal year, totalling 168 million US dollars, on a comparable basis to the same quarter of fiscal 2022; on a constant currency basis, it grew by 3.4%. In this period, the brand's operating income amounted to 18 million US dollars while the operating margin was 10.7%, as compared to the operating income of 16 million US dollars and operating margin of 9.0% recorded in the same three months of last fiscal year.


Michael Kors

In the third quarter of fiscal 2023, Michael Kors' revenue declined by 7.3%, adding 1.095 billion US dollars to the group's total revenue, year-over-year; on a constant currency basis, revenue was down by 3.6%. The brand's operating income totalled 251 million US dollars this quarter while its operating margin corresponded to 22.9%, on a comparable basis to the operating income of 335 million US dollars and operating margin of 28.4% registered in the same quarter of fiscal 2022.

Full Year Outlook

For the full year 2023, Capri Holdings is expecting to reach revenue of 5.56 billion US dollars, as compared to the previous guidance of approximately 5.7 billion US dollars revenue. The company is also anticipating diluted earnings per share of nearly 6.10 US dollars, on a comparable basis to the previous outlook of 6.85 US dollars.


Image Credits: designscene.net

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