The Group’s revenues are said to have exceeded estimates for the third straight quarter. Gross profit increased +7.2% to US$690.8 million, and income from operations was US$199.1 million, or 17.4% as a percentage of total revenue. Total revenue in the Americas increased +0.9% to US$751.9 million on a reported basis (+0.6% on constant), while European revenue was up +9.2% to US$270.7 million on reported (+4.6% on constant). Revenue in Asia increased +30.4% to US$124.0 million on a reported basis (+33.5% on constant).
Overall retail net sales came in at US$645.0 million (+8%), largely attributed to 56 new store openings since the end of Q2 2016, as well as the increase in e-commerce sales in Europe and Asia. On a constant currency basis, retail net sales increased 7.2%, and comparable sales decreased 2.5% in the period, while wholesale net sales increased 1.2%.
Excluding US$1.6 million, or US$0.01 per diluted share, in adjustments, including transaction costs and unrealised gain on derivative contract related to the acquisition of Jimmy Choo and retail store-related restructuring and non-cash impairment charges, net income attributable to MKHL for the second quarter of fiscal 2018 was US$204.5 million, or US$1.33 per diluted share. “This exceeded the Company’s prior expectations of US$0.80 to US$0.84 per diluted share”, says a statement.
For fiscal 2018, the Company expects total revenue to be approximately US$4.59 billion, including between US$215 million and US$225 million of incremental Jimmy Choo revenue. Comparable sales for the Michael Kors brand are expected to decline in the mid-single digits.