NEW YORK — Michael Kors Holdings Ltd. on Tuesday posted second-quarter gains on all fronts, from gross margins to net income to revenues posted for the period.
For the three months ended Sept. 29, net income attributable to shareholders more than doubled to $97.8 million, or 49 cents a diluted share, from $31.6 million, or 22 cents, a year ago.
Total revenues rose 74.4 percent in the quarter to $532.9 million from $305.5 million, which include a 78.2 percent jump in net sales to $513.1 million from $287.9 million. Retail net sales rose 82 percent to $242.3 million, while comparable-store sales gained 45.1 percent.
The results sent Kors’ shares up 0.9 percent Tuesday to close at $51.01.
John D. Idol, chairman and chief executive officer, told analysts during a conference call, “Our performance was driven by continued growth in comparable-store sales, strong performance of our new stores, successful conversion to shop-in-shops and department stores and the advances in our international expansion strategy, as we continue to build brand awareness.”
He told analysts that the company’s gross margin for the quarter was 59 percent, driven primarily by lower markdowns.
By category, Idol said the watch business continues to be “very strong” for the company since it’s a significant part of the retail business in company-owned stores. The firm is also putting greater emphasis on small leather goods. In addition, totes seem to be a huge category for “young girls,” with Idol noting that this consumer is “not only buying a handbag from us but many times she’s buying a handbag and a tote.”
As for retail sales growth, Idol said the business was driven in part by 66 store openings since the second quarter of last year. Total revenue growth was driven by a mix of accessories, footwear, watches, jewelry and eyewear, all of which accounted for 79 percent of the firm’s product assortment in the quarter.
By region, North American revenues rose 72 percent to $471 million, while European sales rose 97 percent to $57 million. Japan is still in development, with sales rising 129 percent to $5 million in the quarter. Idol said the firm’s travel retail business is “developing rapidly” as tours worldwide are bringing groups to the stores when at the airport.
The company is projecting the opening of 40 to 50 stores in North America during the current fiscal year. Idol said the firm remains on track to open 10 to 15 stores annually in Europe. The planned store increase for fiscal 2013 for Japan is 10 new locations.
The ceo said 55 stores saw disruptions from Hurricane Sandy, and while they have reopened, he said many areas “remain challenged” and it is difficult to predict when the consumer behavior would return to normal in those affected areas.
For the third quarter, the firm expects diluted earnings per share at between 37 cents to 39 cents, with total revenues at between $525 million to $535 million. For fiscal 2013, diluted EPS range is between $1.48 and $1.50 and total revenues forecasted at $1.86 billion to $1.96 billion.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast