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Q3FY16 sales at luxury brand Michael Kors up 6.3%
06
Feb '16
For the third quarter ended December 26, 2015, sales at luxury lifestyle brand Michael Kors Holdings went up 6.3 per cent to $1.40 billion from $1.31 billion in the third quarter of fiscal 2015.

In the quarter under review, retail net sales increased 11.1 per cent to $766.2 million driven primarily by ecommerce sales and 114 net new store openings since the end of the third quarter of fiscal 2015.

“On a constant currency basis, retail net sales grew 15.7 per cent and comparable store sales drove up 2.0 per cent,” a Michael Kors press release stated.

In the third quarter of fiscal 2016, wholesale net sales rose by just 0.3 per cent year on year to $575.5 million and on a constant currency basis, wholesale net sales grew 3.0 per cent.

In the reporting quarter, gross profit expanded 4.0 per cent year over year to $832.0 million, and as a percentage of total revenue was 59.5 per cent.

According to the company, foreign currency translations negatively impacted gross profit margin by around 95 basis points and compares to gross margin of 60.9 per cent in the prior year's third quarter.

Income from operations was $409.3 million, or 29.3 per cent as a percentage of total revenue compared to $418.5 million, or 31.8% as a percentage of total revenue, for the third quarter of fiscal 2015.

Net income for the reporting period was $294.6 million or $1.59 per diluted share, based on a 28.0% tax rate and 184.9 million weighted average diluted shares outstanding.

“This includes an unfavourable impact related to foreign currency exchange rates of approximately $0.06 per share,” the company explained.

As against this net income for the third quarter of fiscal 2015 was $303.7 million, or $1.48 per diluted share, based on a 27.2% tax rate and 205.6 million weighted average diluted shares outstanding.

As of December 26, 2015, the company operated 623 retail stores, including concessions, compared to 509 retail stores, including concessions, at the end of the same prior-fiscal period.

The Company had 234 additional retail stores, including concessions, operated through licensing partners and including licensed locations, there are 857 Michael Kors stores worldwide.

CEO John Idol said, “Our performance was driven primarily by strong consumer response to our luxury fashion product offering, particularly in our accessories and footwear categories,”

“It also includes continued momentum in our digital flagship business and outstanding growth in our international markets,” he too added.

“As we look ahead, we are excited about our upcoming Spring collections that embody design innovation and underscore Michael Kors fashion leadership,” Idol stated. (AR)

Fibre2Fashion News Desk – India

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