On a reported basis, net income in the first quarter of 2018 was $60 million or $0.72 per diluted share. On an adjusted basis, net income was $91 million, or $1.11 per diluted share, excluding restructuring-related and other charges. This is compared to a net loss of $22 million, or ($0.27) per diluted share on a reported basis, and net income of $90 million, or $1.06 per diluted share on an adjusted basis, for the first quarter of Fiscal 2017.
The company witnessed reduction in operating expenses by 13 per cent on an adjusted basis to increase efficiency and achieve expense savings targets. The inventory levels were lowered by 31 per cent to last year to improve inventory turns. The company's wholesale distribution was optimised by closing 20-25 per cent of its underperforming US department store points of distribution by the end of fiscal 2018.
The company's gross profit for the first quarter of 2018 was $851 million on a reported basis and $852 million on an adjusted basis, excluding approximately $1 million of inventory charges related to our restructuring activities. Gross margin was 63.2 per cent on both a reported and adjusted basis, 210 basis points above the prior year on an adjusted basis.
"I am thrilled to welcome Patrice Louvet as my partner to continue the exciting evolution of our Company,” said Ralph Lauren executive chairman and chief creative officer. "Patrice has the enthusiasm to discover what has made our brand so iconic and the capability to evolve our business. We are both committed to preserving the essence of our brand while actively evolving it to renew long-term growth. Our experiences and expertise will be a powerful and winning combination."
"While we are addressing challenges in our business, we have significant opportunity ahead and we’re moving forward with urgency," said Patrice Louvet, president and chief executive officer. "Ralph and I are focused on actively evolving the brand expression and consumer experience so we can ultimately renew growth and get back to leading. We are continuing to build a strong foundation for future growth, as evidenced by our progress this quarter on the key elements of the way forward plan."
For Fiscal 2018, the company continues to expect net revenue to decrease 8 to 9 per cent, excluding the impact of foreign currency. The net revenue is expected to be down around 9 to 10 per cent for the second quarter of 2018. (RR)
Fibre2Fashion News Desk – India
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