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Michael Kors Holdings Limited Announces First Quarter Fiscal 2014 Results

Michael Kors Holdings Limited (NYSE:KORS) (the “Company”), a global luxury lifestyle brand, today announced its financial results for its fiscal 2014 first quarter ended June 29, 2013.

John D. Idol, the Company’s Chairman and Chief Executive Officer, said, “Our exceptional first quarter financial results demonstrate the sustained strong demand for the Michael Kors luxury brand. We attribute the ongoing momentum to our fashion design leadership combined with an aspirational jet-set luxury in-store experience. As we continue to successfully execute on our strategic initiatives, we remain excited about our future growth potential.”

For the first quarter ended June 29, 2013:

  • Total revenue increased 54.5% to $640.9 million from $414.9 million in the first quarter of fiscal 2013.
  • Retail net sales increased 51.5% to $325.7 million driven by a 27.3% increase in comparable store sales and 75 net new store openings since the end of the first quarter of fiscal 2013. Wholesale net sales increased 59.3% to $290.6 million and licensing revenue increased 40.7% to $24.6 million.
  • Gross profit increased 58.3% to $397.3 million, and as a percentage of total revenue increased to 62.0% compared to 60.5% in the first quarter of fiscal 2013.
  • Income from operations was $197.6 million, or 30.8% as a percentage of total revenue, as compared to $111.9 million, or 27.0% as a percentage of total revenue, for the first quarter of fiscal 2013.
  • Net income was $125.0 million, or $0.61 per diluted share, based on 204.3 million weighted average diluted shares outstanding. Net income for the first quarter of fiscal 2013 was $68.6 million, or $0.34 per diluted share, based on 199.4 million weighted average diluted shares outstanding.
  • At June 29, 2013, the Company operated 328 retail stores, including concessions, compared to 253 retail stores, including concessions, at the end of the same prior-year period. The Company had 114 additional retail stores, including concessions, operated through licensing partners. Including licensed locations, there were 442 Michael Kors stores worldwide at the end of the first quarter of fiscal 2014.

Mr. Idol continued, “The strong performance in our retail, wholesale and licensing segments as well as across geographies led to record operating profits. North American comparable store sales increased 25%, as our luxury accessories and ready-to-wear offering and jet-set in-store experience continue to resonate strongly with consumers. Sales in our North America wholesale segment increased 50%, driven by comparable store sales growth as well as the continued successful conversion of shop-in-shops in department stores. In Europe, sales grew 144% in the first quarter, as growing brand awareness led to comparable store sales growth of 56%. Finally, in our licensing segment, revenue increased 41%, driven primarily by the strength in watches and eyewear. Overall, we remain extremely pleased with Michael Kors’ positioning within the growing global luxury lifestyle market and the advances we are making on our strategic growth initiatives.”

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