Capri Holdings swung to a second-quarter profit and edged up its full-year earnings target, even as declining revenue at Michael Kors prompted the luxury group to lower its annual revenue forecast.
The fashion company, which owns the Michael Kors and Jimmy Choo brands, on Friday said it now expects total revenue of about $3.42 billion, and earnings of about $2.20 a share. Previously the company expected total revenue of $3.53 billion and earnings per share of $2.15.
Chief Executive John Idol said the company continues to expect revenue to return to growth in the second half of the year, driven by new collections, a boost in marketing investments and a focus on elevating the customer experience.
The guidance changes come after the company posted net income of $27 million, or 25 cents a share, for the three months ended Sept. 26, compared with a loss of $28 million, or 22 cents a share, in the same quarter a year ago.
Adjusted earnings were 42 cents a share. According to FactSet, analysts were expecting 21 cents a share.
Revenue fell 5.5% fell to $809 million, above analyst forecasts of $786.5 million. The company's Michael Kors brand logged an 8.6% decline in revenue to $663 million, while Jimmy Choo revenue rose by nearly 12% to $146 million.
Capri noted that about $20 million of revenue was due to earlier-than -anticipated timing of wholesale shipments.
Chief Executive John Idol said throughout the second quarter, trends improved each month across both of its brands, citing a tighter product assortment, brand desirability and strong consumer engagement.
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