Ralph Lauren's Q1 Highlights: Earnings Beat, Margin Pressure, Higher Inventory & More

  • Ralph Lauren Corp RL reported first-quarter FY23 sales growth of 8% year-on-year, to $1.49 billion, beating the consensus of $1.41 billion.
  • Revenue in North America increased 6% to $701 million, Europe rose 17% to $416 million, and Asia grew 16% to $334 million.
  • The gross profit climbed 3.4% to $1 billion with a gross margin of 67.2%. Adjusted gross margin was 68.0%, 180 basis points below the prior year on a reported basis, and down 80 basis points in constant currency.
  • Operating margin was 11.8%, and operating income for the quarter declined 20.5% to $175 million. Adjusted operating margin was 12.7%, 410 basis points below the prior year.
  • The company held $1.8 billion in cash and equivalents as of July 2, 2022. Cash provided by operating activities for the quarter totaled $45.3 million versus $247.6 million a year ago.
  • Inventory at the end of the quarter rose 47% to $1.2 billion., reflecting higher increases in goods-in-transit to mitigate global supply chain delays and meet strong consumer demand along with continued elevation in product mix.
  • Adjusted EPS of $1.88 beat the analyst consensus of $1.75.
  • Outlook: Ralph Lauren continues to expect FY23 constant currency revenues to increase approximately high single digits to last year on a 52-week comparable basis, with an outlook centered around 8%.
  • For Q2, the company expects revenue growth to be in a range centered around 11% in constant currency.
  • Price Action: RL shares are trading lower by 6.67% at $94.41 on the last check Tuesday.
  • Photo Via Wikimedia Commons
Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Date
ticker
name
Actual EPS
EPS Surprise
Actual Rev
Rev Surprise
Posted In: EarningsNewsGuidanceMoversTrading IdeasGeneralBriefs
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!