John D. Idol, Chairman and Chief Executive Officer, said: “We are encouraged by our first quarter performance, with growth in revenues, gross margin, operating margin as well as earnings per share all exceeding our expectations. Our fashion leadership remains strong, which drove consumers to respond favorably to both new fashion introductions and core products. Our global fashion luxury group continues to see the benefits of our long term growth strategy which is driven by both the Michael Kors and Jimmy Choo brands. Looking ahead we remain optimistic about our business for the remainder of fiscal 2019 and beyond.”

For the first quarter, ended on the 30^th of June, total revenue increased by 26.3% totaling 1.20 billion US dollars, including a 172.7 million US dollars contribution from Jimmy Choo, which was consolidated into results effective from the 1^st of November 2017.

MK Retail revenue increased by 3.2% to 639.5 million US dollars driven in large part by 9 net new store openings since the end of the first quarter of fiscal 2018. Comparable sales increased by 0.2%, with positive performance in the Americas and Asia, partially offset by declines in Europe, as expected. Revenue included a net favorable foreign currency impact of 15.0 million US dollars and comparable store sales decreased by 2.1% on a constant currency basis.

MK Wholesale revenue increased 19.5% to 362.8 million US dollars, driven by improvements in the underlying business, as well as a shift in timing of certain wholesale shipments from second quarter into first quarter. 

MK Licensing revenue decreased 4.8% to 27.5 million US dollars. Continued positive growth of Michael Kors ACCESS smart watches was not enough to offset the continued decline of fashion watches.

Jimmy Choo's revenue exceeded expectations due to strong performance in footwear, as well as a shift in timing of certain wholesale shipments from second quarter into first quarter.

Retail network

By the end of the first quarter, Michael Kors operated 847 retail stores, including concessions, and an additional 153 retail stores, including concessions, were operated through licensing partners. Including licensed locations, there were 1 000 Michael Kors stores worldwide at the end of the first quarter of fiscal 2019. As of the 30^th of June Jimmy Choo operated 191 retail stores, including concessions, and an additional 61 retail stores, including concessions, were operated through licensing partners. Including licensed locations, there were 252 Jimmy Choo stores worldwide at the end of the first quarter of fiscal 2019.

Outlook

For the full year Michael Kors now expects total revenue to be approximately 5.125 billion US dollars, including between 580 million US dollars and 590 million US dollars of incremental Jimmy Choo revenue.