Michael Kors parent company Capri Holdings managed to narrow its losses in the fourth quarter of the year despite revenue remaining flat, as revenue for all three of its luxury houses beat expectations.
The luxury fashion group, which also owns brands Jimmy Choo and Versace, reported a net loss of 183 million dollars for the three months ended March 27, compared to a loss of 551 million dollars a year earlier.
Revenue was more or less flat to the prior year at 1.2 billion dollars, but that was ahead of analysts’ estimates. It came as lockdowns continued to affect its store estate, with approximately 60 percent of the company’s retail stores in EMEA and approximately 40 percent of its Canada stores closed during the fourth quarter.
The group’s e-commerce did particularly well, with sales up 80 percent in the quarter. Retail sales were also up 13 percent globally, with growth across all three of its luxury houses.
Breaking it down by brand, Michael Kors - the group’s biggest label - reported a 3.9 percent drop in revenue to 838 million dollars, while revenue at Jimmy Choo increased 15.9 percent to 124 million dollars and revenue at Versace was up 10.3 percent to 235 million dollars.
Capri upbeat on recovery of luxury industry
For the full year, the group’s revenue dropped 27 percent to 4.06 billion dollars, while net loss narrowed to 62 million dollars from 223 million dollars a year earlier.
CEO John D. Idol was upbeat on the group’s results despite the “profound effect” of the pandemic.
“The unprecedented challenges tested our business and industry in ways we could never have imagined,” he said in a release. “Despite these challenges, we were encouraged by the performance of all three of our luxury houses, with revenue and earnings significantly exceeding our expectations.”
Looking ahead, Idol said he remains optimistic about the recovery of the fashion luxury industry as parts of the world begin to reopen.
The company now expects full-year 2022 revenue of 5.1 billion dollars - that’s ahead of analysts’ expectations of 4.99 billion dollars, according to IBES data from Refinitiv.