Luxury handbag retailer Michael Kors (KORS) reported better-than-expected Q4 results, aided by the company’s strategy of product innovation. During the quarter, the company posted earnings of $0.29 per share, compared with a net loss of $0.17 a year earlier. Excluding items, the company earned $0.63 a share, beating analysts’ expectation of $0.60 a share.
Revenue for the quarter came in at $1.18 billion, easily topping the consensus estimate of $1.15 billion as comparable sales increased 2.3%. This was driven by strong response to innovative and elevated fashion luxury offering across accessories, footwear, ready-to-wear and men’s categories. Despite the upbeat results, the company’s shares fell 1.44% during the pre-market trading.
Last year, Michael Kors completed the acquisition of shoemaker Jimmy Choo in a $1.2 billion deal. Jimmy Choo is seen as one of the key growth drivers for the company.
John D. Idol, the CEO, said, “We created a global fashion luxury group with the acquisition of Jimmy Choo and completed the first year of our Runway 2020 strategic plan for the Michael Kors brand, ending the year significantly ahead of our expectations.”
Jimmy Choo is seen as one of the key growth drivers for the company.
For Q1 2019, the company expects total revenue to be approx $1.135 billion, including $140-145 million of incremental Jimmy Choo revenue. Comparable sales are expected to be flat during this period. EPS is expected to be in the range of $0.90 to $0.95.
For fiscal 2019, Michael Kors predicts EPS of $4.65 to $4.75, on a total revenue of about $5.10 billion. Comparable sales are expected to be flat for this period as well.