Michael Kors Q4 EPS, Revenue Ahead Of Its Expectations; Revenue Up 10.9%

(RTTNews) - Michael Kors Holdings Limited (KORS), a global luxury lifestyle brand, reported fourth-quarter net income attributable to company of $177.0 million, or $0.98 per share, which included an unfavorable impact related to foreign currency exchange rates of approximately $0.02 per share. Net income attributable to MKHL for the fourth quarter of prior year was $182.6 million, or $0.90 per share. On average, 27 analysts polled by Thomson Reuters expected the company to report profit per share of $0.97 for the quarter. Analysts' estimates typically exclude special items.

The company noted that fiscal 2016 had 53 weeks versus 52 weeks in fiscal 2015. The company's results for fiscal 2016 fourth quarter include approximately $34 million in retail sales related to the 53rd week.

For the fourth quarter ended April 2, 2016, total revenue increased 10.9% to $1.20 billion from $1.08 billion, prior year. On a constant currency basis, total revenue increased 11.7%. Analysts expected revenue of $1.15 billion for the quarter. Total revenue in the Americas increased 4.6% to $879.1 million on a reported basis, and increased 5.1% on a constant currency basis.

Retail net sales increased 22.0% to $572.6 million. Comparable sales increased 0.3%. On a constant currency basis, retail net sales grew 23.4%, and comparable sales increased 1.5%. Wholesale net sales increased 3.5% to $590.5 million and on a constant currency basis, wholesale net sales grew 4.0%.

In February, the company projected its fourth-quarter total revenue to be in the range of $1.13 billion to $1.15 billion, and earnings per share in the range of $0.93 to $0.97.

For the first quarter of fiscal 2017, the company expects total revenue to be between $940 million and $950 million, which includes a planned reduction in wholesale shipments, and comparable sales to decrease in the mid-single digit range. Earnings per share are expected to be in the range of $0.70 to $0.74 for the first quarter of fiscal 2017 on a non-GAAP basis, excluding the one-time costs, and $0.62 to $0.66 on a GAAP basis, including the one-time costs. Analysts expect the company to report profit per share of $0.94 on revenue of $1.03 billion.

For fiscal 2017, the company expects total revenue to be flat versus the prior year and comparable sales to decrease in the low single digit range. For fiscal 2017, earnings per share are expected to be in the range of $4.56 to $4.64 on a non-GAAP basis, excluding the one-time costs, and $4.47 to $4.55 on a GAAP basis, including the one-time costs. Analysts expect the company to report profit per share of $4.50.

Shares of the company were up more than 10 percent, in premarket trading, following the earnings announcement.

The company's Board authorized a new $1 billion share repurchase program, which replaces the remaining balance of the previous program authorized in October 2014. During the fourth quarter, the company repurchased 3,690,685 of its ordinary shares for approximately $200.0 million in open market transactions.

The company completed the acquisition of Michael Kors (HK) Limited, the exclusive licensee of the company in China and certain other jurisdictions in Asia, on May 31, 2016, for $500 million in cash, subject to certain adjustments.