The North America, revenue of the company in the second quarter decreased 1 per cent to $881 million. In retail, comparable store sales in North America were up 2 per cent, while in wholesale the revenue decreased 6 per cent.
The Europe, revenue in the second quarter increased 3 per cent to $480 million on a reported basis and 8 per cent in constant currency. In retail, comparable store sales in Europe were up 3 per cent, while wholesale revenue increased 2 per cent on a reported basis and 7 per cent in constant currency.
The Asia revenue in the second quarter increased 4 per cent to $255 million on a reported basis and 5 per cent in constant currency, driven by solid growth in retail.
Gross profit for the second quarter of fiscal 2020 was $1 billion and gross margin was 61.5 per cent. Adjusted gross margin was 60 basis points above the prior year on a reported basis and up 80 basis points in constant currency.
“Our global teams are elevating our iconic brand across every market and channel,” said Ralph Lauren, executive chairman and chief creative officer of the brand. “From our stores to our digital flagships and the way we are connecting on social media, the authentic expression of the Ralph Lauren lifestyle is showing up in relevant ways all over the world.”
“We delivered second quarter results slightly ahead of our overall expectations, including better than expected revenues, operating margin, and double-digit EPS growth, amid a more challenging operating environment,” said Patrice Louvet, president and chief executive officer of Ralph Lauren. “Our progress was driven by a continued focus on brand elevation and creating immersive lifestyle experiences that are amplified across our stores and digital marketing and commerce channels around the world, while also maintaining expense discipline.”
For fiscal 2020, the company continues to expect net revenue growth of 2-3 per cent on a constant currency basis but now expects results at the low end of this range, primarily based on intensifying headwinds in Hong Kong. Foreign currency is now expected to negatively impact revenue growth by approximately 130 basis points in fiscal 2020.
The company continues to expect operating margin for fiscal 2020 to increase 40 to 60 basis points in constant currency. This outlook now includes the impact of List 4 tariffs from China. Foreign currency is expected to negatively impact operating margin by about 20 basis points in fiscal 2020.
In the third quarter of fiscal 2020, the company expects net revenue to be about flat in constant currency. Foreign currency is expected to pressure revenue growth by approximately 70 to 90 basis points.
Fibre2Fashion News Desk (PC)
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