Ralph Lauren edges past revenue estimates in third quarter
Iconic American fashion house Ralph Lauren Corporation announced slight increases in its Q3 revenues on Tuesday, beating out analysts’ estimates and sending shares in the company up around 6% in premarket trading.
In the third quarter ended December 28, 2019, Ralph Lauren’s net revenue totaled $1.75 billion, up 1% from $1.73 billion in the prior-year period. In constant currencies the increase was 2%.
According to IBES data from Refinitiv, analysts had expected the fashion house to report revenues of $1.72 billion.
The New York-based company’s quarterly revenues in North America rose from $908.7 million to $910.6 million, reflecting a 4% increase in comparable store sales. This growth was driven by a 4% rise in brick-and-mortar store sales and a 6% increase on the company’s e-commerce platform.
In contrast, wholesale revenues in the region fell 8%.
Ralph Lauren’s European revenues increased 3% (5% in constant currencies) to $437.8 million, compared to $425.0 million in the third quarter of fiscal 2019. Comparable store sales in Europe rose 3%, reflecting a 2% rise in brick-and-mortar store sales and a 15% increase in the digital channel. Wholesale revenues rose 2%.
In Asia, the company’s revenues totaled $289.6 million, up 5% from $274.8 million. Comparable store sales in the region fell 1%, as growth was offset by declines in Hong Kong. Excluding Hong Kong, comparable store sales rose 2%.
Ralph Lauren’s third-quarter net income was $334.1 million, or $4.41 per diluted share, up from $120.0 million, or $1.48 per diluted share.
“We continue to make strong progress on our Next Great Chapter plan amid a volatile backdrop, with third quarter results ahead of our overall expectations, including better than expected revenues, operating margin, and double-digit EPS growth," said Ralph Lauren Corporation president and CEO Patrice Louvet in a release.
"Over the important holiday season, our teams consistently executed across each of our strategic priorities, enabling us to elevate our brand and deliver for our consumers across every touch point," he added.
As it looks to win over a new generation of consumers, Ralph Lauren increased its marketing spend by 16% over the holiday season in order to drive brand awareness.
The company also pushed forward with the development of its digital platforms around the world, launching its mobile app in the UK and Buy Online-Ship From Store fulfillment in China, as well as implementing improvements in mobile and personalization options on ralphlauren.com.
Year to date, Ralph Lauren’s net revenues totaled $4.89 billion, compared to $4.81 billion in the same nine-month period in the previous year. Net income was $633.3 million, or $8.13 per diluted share, up from $399.3 million, or $4.85 per diluted share.
Looking forward, the company expects net revenues to increase slightly in the fourth quarter, while revenues for the full year fiscal 2020 are predicted to be up in the range of 2% to 3%.
Copyright © 2022 FashionNetwork.com All rights reserved.