Gross profit for the fourth quarter of fiscal 2017 was $819 million on a reported basis, including $48 million in non-cash inventory-related charges. On an adjusted basis, gross profit was $868 million and gross margin was 55.4 per cent, 90 basis points above last year, excluding non-cash inventory related charges from both periods. This increase was primarily driven by improved quality of sales, reduced promotional activity, lower product costs, and favorable geographic and channel mix shifts. Gross margin improvement was partially offset by unfavourable foreign currency effects of 90 basis points in the fourth quarter.
Operating expenses in the fourth quarter of Fiscal 2017 were $1.1 billion on a reported basis, including $322 million in restructuring and other charges. On an adjusted basis, operating expenses were $766 million, down 15 per cent compared to the prior year.
"The retail landscape today is more dynamic than ever, but within this environment, our brand continues to be one of the most recognized and beloved all over the world. Our performance for the year reflects our work to strengthen our brand and I am confident that the actions we are taking, combined with our strong heritage, position us well to succeed. I am very excited to partner with Patrice Louvet, who will join as our CEO in July, as we continue our evolution," said Ralph Lauren, executive chairman and chief creative officer.
"Fiscal 2017 was an important year as we strengthened the foundation of the company. We created operational efficiencies, increased the productivity of our assortment and improved quality of our sales," said Jane Nielsen, chief financial officer.
For Fiscal 2018, net revenue is expected to decrease 8-9 per cent, excluding the impact of foreign currency. Based on current exchange rates, foreign currency is expected to have approximately 150 basis points of negative impact on revenue growth in Fiscal 2018. (RR)
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