Michael Kors has released earnings results for the second quarter fiscal 2018 in which sales have declined by 2.1%.
According to an article on Reuters, Michael Kors has released earnings results for Q2 in which sales have declined by 2.1%. The brand, which acquired Versace for $2 billion a couple of months ago in September, says net income declined to $137.6 million. That’s compared to last year with net income at $202.9 million. Revenue increased 9.3% to $1.25 billion, which as less than analysts estimates of $1.26 billion.
Michael Kors released a statement saying,
“we are pleased to report results that have again exceeded our expectations, and are raising our fiscal 2019 EPS guidance to a range of $4.95 to $5.05, reflecting double digit earnings growth for the year. As we enter the second half of fiscal 2019 we look forward to welcoming Versace into our group. With the acquisition of Versace we have built one of the world’s leading fashion luxury groups in just one year, setting the stage for accelerated revenue and earnings growth. This is a truly remarkable and historic moment for our company and we look forward to completing this transformational acquisition in the coming months.”
The brand says sales declined because it didn’t have enough inventory of its logo bags. Logo bags have been becoming quite popular lately and the brand’s logo bags, which are about 25% of revenue, are still sold out.
A couple of months ago in September, the brand announced it would acquired Versace for about $2 billion. The brand said it expects the acquisition to increase sales and profits where it plans to increase revenue at Versace to $2 billion, open 200 to 300 stores, and increase accessories and footwear from 35% to 60% of revenue.
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