Ralph Lauren Corporation (NYSE:RL) today reported net income of $153 million, or $1.68 per diluted share, for the fourth quarter of Fiscal 2014, compared to net income of $127 million, or $1.37 per diluted share, for the fourth quarter of Fiscal 2013. Net income for the full year Fiscal 2014 period was $776 million, or $8.43 per diluted share, compared to net income of $750 million, or $8.00 per diluted share, for Fiscal 2013.
"Fiscal 2014 was another year of record sales and profits for us," said Ralph Lauren, Chairman and Chief Executive Officer. "It was also a year of important achievements, including the establishment of a new global leadership structure, creating greater clarity around our global store development efforts and innovating with new products, particularly in accessories and with Polo for women. The creativity, passion and diligence that defines all that we do is incredibly invigorating. I am confident we are focused on the right initiatives and that we have the right team in place to realize our goals.”
“Our strong sales growth in the fourth quarter and full year Fiscal 2014 periods is a clear demonstration of the tremendous appeal of the Ralph Lauren brand and the diversity of our operating model across channels, regions and merchandise categories," said Jacki Nemerov, President and Chief Operating Officer. "Our better-than-expected operating results were supported by the investments we’ve made over the last several years. We will continue to invest for the future during Fiscal 2015, as we believe the returns on our investments will support significant shareholder value creation as we make important progress on our core growth objectives.”
Fourth Quarter and Full Year Fiscal 2014 Income Statement ReviewNet Revenues. Net revenues for the fourth quarter of Fiscal 2014 rose 14% to $1.9 billion. The increase in net revenues reflects robust wholesale segment growth and strong retail segment expansion. Net revenues for the full year Fiscal 2014 period increased 7% to $7.4 billion. Excluding the net negative impacts from discontinued businesses and foreign currency translation, net revenues increased approximately 9% during Fiscal 2014.
- Wholesale Sales. Wholesale segment sales increased 24% to $983 million in the fourth quarter, fueled by broad-based growth in the Americas, including strong demand for accessories; the contribution from the newly transitioned Chaps men’s sportswear operations; and double-digit growth in Europe.For Fiscal 2014, wholesale revenues were $3.5 billion, 11% above Fiscal 2013. The increase in wholesale revenues was primarily a result of strong momentum in the Americas and the contribution from newly transitioned operations.
- Retail Sales. Retail sales rose 5% to $845 million from $805 million in the fourth quarter of Fiscal 2013, driven by growth in international operations and global store expansion, including newly transitioned operations in Australia/New Zealand. Excluding the impacts of discontinued businesses and net negative foreign currency effects, retail sales rose 7% from the prior year period. Consolidated comparable store sales declined 2% on a reported basis and were down 1% in constant currency during the fourth quarter, reflecting the cold and late start to Spring in North America and the shift in the timing of Easter compared to the prior year.Retail sales for Fiscal 2014 were up 5% to $3.8 billion from $3.6 billion in Fiscal 2013, driven by the contribution from global store expansion, double-digit growth in e-commerce and incremental sales from the newly transitioned Australia/New Zealand operations. Excluding the impacts of discontinued businesses and net negative foreign currency effects, retail sales rose 8% from the prior year period. During Fiscal 2014, consolidated comparable store sales were flat on a reported basis and were up 1% in constant currency.
- Licensing. Licensing revenues of $39 million in the fourth quarter were 10% below the prior year period, as higher licensing revenues for Ralph Lauren products were more than offset by lower Chaps and Australia/New Zealand licensing revenues due to recent license take-backs.Licensing revenues of $166 million in Fiscal 2014 were 9% below Fiscal 2013’s level, as higher licensing revenues for Ralph Lauren products were more than offset by lower Chaps and Australia/New Zealand licensing revenues due to recent license take-backs.