World Footwear

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Michael Kors exceeds expectations for revenue

May 30, 2018 / United Kingdom
Michael Kors exceeds expectations for revenue
The UK-based luxury group announced its financial results for 2018 fourth quarter and fiscal year, ended on the 31st March 2018. Expectations for revenue in the period were surpassed
John D. Idol, the company’s Chairman and Chief Executive Officer, commented: “Fiscal 2018 was an exciting year for our company as we established a foundation to support long term growth. We created a global fashion luxury group with the acquisition of Jimmy Choo and completed the first year of our Runway 2020 strategic plan for the Michael Kors brand, ending the year significantly ahead of our expectations.”

In the fourth quarter Michael Kors’ (MK) total revenue increased by 10.8%, totaling 1.18 billion US dollars, including a 107.9 million US dollars contribution from Jimmy Choo. On a constant currency basis, total revenue increased by 7.2%. MK Retail revenue increased by 4.4% to 600.6 million US dollars. Comparable sales increased by 2.3%, driven by growth in the accessories, footwear, ready-to-wear and men's categories. On a constant currency basis, retail revenue increased by 0.1%, and comparable sales decreased by 1.7%. MK Wholesale revenue decreased by 3.2% to 441.3 million US dollars (on a constant currency basis decreased by 6.1%) and the Licensing business revenue decreased by 11.1% to 29.7 million US dollars.

Net income attributable to MK int he fourth quarter totaled 44.1 million US dollars, or 0.29 US dollars per diluted share, based on 154.3 million weighted average diluted shares outstanding.

Fiscal 2018 results


For the fiscal year total revenue increased by 5.0% totaling 4.72 billion US dollars from 4.49 billion US dollars, including a 222.6 million US dollars contribution from Jimmy Choo. On a constant currency basis, total revenue increased by 3.6%. MK Retail revenue increased by 5.4% totaling 2.71 billion US dollars. Comparable sales decreased by 2.2%. On a constant currency basis, retail revenue increased by 3.9%, and comparable sales decreased by 3.7%. MK Wholesale revenue decreased by 7.7% to 1.64 billion US dollars and on a constant currency basis decreased by 9.1%, driven by the company's strategic reduction in inventory levels to drive higher full price sell through and elevate brand positioning. MK Licensing revenue decreased by 0.6% to 144.9 million US dollars. 

Net income attributable to MK totaled was 591.9 million US dollars, or 3.82 US dollars per diluted share, based on 155.1 million weighted average diluted shares outstanding.

As at the end of the financial year Michael Kors operated 829 retail stores, including concessions, and an additional 151 retail stores, including concessions, were operated through licensing partners. At the same time, Jimmy Choo operated 182 retail stores, including concessions, and an additional 61 retail stores, including concessions, were operated through licensing partners.

Forecasting fiscal 2019

 “Looking to fiscal 2019, we have a number of initiatives planned to drive growth in both of our luxury brands. For Michael Kors, we expect growth to be led by our retail business, as we remain focused on executing initiatives across fashion luxury product, brand engagement and customer experience. For Jimmy Choo, we will continue to make strategic investments to expand our retail fleet globally, capitalize on the significant opportunity to grow our accessories business and increase brand engagement through glamorous red-carpet marketing communications. Additionally, we will continue to explore acquisitions to complement our existing luxury portfolio", Mr. Idol concluded.

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