UPDATE: Ralph Lauren Posts Upbeat Q2 Earnings, Lowers Sales Forecast
Ralph Lauren (NYSE: RL) reported stronger-than-expected earnings for the second quarter and cut its sales forecast for the year.
For the current quarter, Ralph Lauren projects revenue to rise 3% to 5%, versus analysts' expectations for a 9% growth.
For the year ending in March, Ralph Lauren expects revenue growth of 5% to 7%, versus its previous forecast of 6% to 8% growth.
The New York-based company posted a quarterly profit of $201 million, or $2.25 per share, versus a year-ago profit of $205 million, or $2.23 per share.
Its revenue climbed 4% to $1.99 billion versus $1.92 billion. However, analysts were expecting earnings of $2.04 per share on revenue of 2.02 billion.
Ralph Lauren's sales, excluding newly opened or closed locations, gained 1% in the quarter.
The company's retail sales surged around 7% to $1.01 billion, while sales in the wholesale segment rose 1.6% to $943 million. Licensing revenue gained 2% to $45 million.
Its gross profit margin widened to 56.8% from 56.6%, while operating expenses increased 7% to $846 million.
Ralph Lauren ended the quarter with $1.2 billion in cash and investments, versus $1.4 billion in cash and investments at the end of the second quarter of Fiscal 2014.
The company repurchased around 0.4 million shares of Class A Common Stock during the quarter. The Company ended the quarter with 448 directly operated stores.
“Our better-than-expected second quarter results showcase the operational discipline of our organization,” said Jacki Nemerov, President and Chief Operating Officer. “Despite the challenging global macroeconomic environment, we continue to experience strong momentum in key areas of strategic focus, including double-digit revenue growth internationally and for our e-commerce business.
Ralph Lauren shares fell 2.47% to $156.95 in pre-market trading.
© 2016 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.