Ralph Lauren profit surges

Polo Ralph Lauren is going from strength to strength. The US-based fashion house posted a 31.5 percent rise in net income for the second quarter to $137 million (£71.8 million). Revenues gained 13.6 percent to $1.17 billion. "We are one of the healthiest and fastest-growing luxury businesses today," chairman and chief executive Ralph Lauren said in a statement. "The key to our continued success is our focus, whether it is product and/or how we operate our business. And our growth comes from our commitment to consistency that stays true to a single point of view."

During the first six months, net income soared 40.2 percent to $217.2 million on revenues up 19.2 percent to $2.12 billion. Wholesale sales rose 25.8 percent to $1.15 billion, while retail sales gained 15.1 percent to $856.7 million. In the second quarter, wholesale sales rose 14.3 percent to $659.9 million and retail sales climbed 14.8 percent to $444.6 million. Excluding the purchase of its Polo Jeans license, wholesale sales rose 6 percent. Same store sales at the Ralph Lauren brand increased 9.6 percent and gained 15.9 percent at Club Monaco stores. The company's factory stores saw same store sales rise 8.4 percent. Sales of the online Polo business gained 35 percent. Polo has raised its full-year earnings expectations and has also announced the $9 million acquisition of its belts and small leather goods licensee New Campaign.

In a conference call with analysts, president and chief operating officer Roger Farah reiterated Lauren's comment about the company's success formula. "We are very clear on who our customer is, and all of our products and all of our brands are focused on that customer and our channels of distribution are positioned to service those customers." He also said the company is planning to add more stores within the next three to five years, notably in Europe , where it has only 13 freestanding Ralph Lauren stores. He told WWD that existing stores could be used to sell derivative merchandise.

Consolidated group revenue growth for the third quarter is expected to be in the low double digits, the company said. The growth is related to the low double digit growth of both the retail and wholesales divisions.

www.poloralphlauren.com 9 November 2006

 

Ralph Lauren opens in Russia

Ralph Lauren is set to open two new stores in Moscow in spring 2007. As part of its international expansion drive, the luxury retailer will open an 8,000 square foot flagship store in Tretyakoysky Passage and a second store location in the Baryikha Luxury Village . Both locations are prime luxury shopping areas, although the Tretyakoysky Passage is a traditional and historical landmark while Baryikha is a contemporary project. The latter will therefore house a more contemporary assortment within a modern setting, while the flagship at Tretykoysky Passage will offer premier assortments of Ralph Lauren's men's and women's luxury brands within the company's trademark, traditional interior. These stores are part of a joint venture between Ralph Lauren and Mercury Distribution, which has extensive experience in the luxury and fashion business in Moscow . A spokeswoman for Ralph Lauren said that there are no further openings in store for the time being "This is already a large-scale enterprise in itself," she said. Specific opening dates must still be set.