Michael Kors Holdings Ltd.
) continues its fabulous run as the company came up with yet
another stellar quarterly performance. The company's fourth-quarter
fiscal 2014 earnings per share of 78 cents came way ahead of the
Zacks Consensus Estimate of 68 cents per share while rising 56.0%
year over year.
For fiscal 2014, earnings per share came in at $3.22, topping the
Zacks Consensus Estimate of $3.12 per share while rising 63.5% year
The company's quarterly revenues of $917.5 million handily
surpassed the Zacks Consensus Estimate of $823.0 million and grew
nearly 53.6% year over year. Full year revenues of $3,310.8
million, exceeded the Zacks Consensus Estimate of $3,190.0 million
and increased 51.8% year over year.
Strong performance across all segments and geographies facilitated
Comparable store sales (comps) increased 26.2% in the quarter,
making this the 32nd straight quarter of comps growth.
Gross profit surged 54.2% year over year to $549.4 million, while
gross margin grew 20 basis points (bps) to 59.9%. Operating profit
increased 58.3% year over year to $245.9 million and operating
margin expanded 80 bps to 26.8%.
Net sales for the
segment grew 49.7% year over year to $408.4 million aided by a
comps rise of 26.2% and opening of 101 new stores over the past
year. Operating profit increased 14.5% to $89.7 million.
segment, revenue increased 55.5% to $473.7 million while operating
profit grew 87.5% to $139.5 million.
segment revenues rose 79.1% to $35.4 million while operating profit
grew substantially to $16.7 million. The growth was attributed to
strong the performance of fragrance, luxury watch and eyewear
(U.S. and Canada) grew 43.0% to $739.4 million while comps jumped
20.6% driven by solid demand for watches and accessories.
Additionally, the region's wholesale also contributed to the rise
with improved sales in accessories and footwear as well as the
ongoing transformations of shop-in-shops into department stores.
, increasing brand recognition and demand led to whopping 125% rise
in revenues, which came in at $164.7 million. Comps in the region
stood out registering a 62.7% growth over the past year.
Lastly, revenue grew 88.5% year over year to $13.4 million in the
, including the markets of Japan, Latin America and the Far East.
Other Financial Data
As of Mar 29, 2014, Michael Kors had cash and cash equivalents of
$955.1 million and shareholders' equity of nearly $1,806.1 million.
At the end of fiscal 2014, Michael Kors operated 555 stores across
the globe, inclusive of licensed locations.
Management initiated fiscal 2015 guidance, and expects
first-quarter fiscal 2015 revenues to be $840-$850 million, comps
to increase 20% and earnings per share to be 78-80 cents. The tax
rate is likely to be around 33.5%. The Zacks Consensus Estimate is
pegged at 79 cents per share.
For the full year, revenues are likely to be in the range of
$4.0-$4.1 billion, while comps are projected to increase in the
high teens. Earnings are expected to be in the range of $3.85-$3.91
per share. The Zacks Consensus Estimate is pegged at $3.82 per
share, which could see upward revision in the coming days.
Michael Kors has performed impressively in the last few quarters.
This Zacks Rank #3 (Hold) stock is seeking to carve out a niche in
the high-end retail sector by broadening its footprint in strategic
markets and offering merchandise that caters to the fashion elites.
In addition to its watch and handbag collection, Michael Kors is
now focused on enhancing its apparel, footwear and other
miscellaneous categories to compete better with peers like
Ralph Lauren Corp.
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