NEW YORK, N.Y. – Online sales and new stores sent revenue surging during the fourth quarter at Michael Kors, sending the retailers beleaguered shares sharply higher in early trading.
The new stores, 142 of them, came at a cost and profit dipped to $177 million. Yet on a per-share basis, profit rose to 98 cents, from 90 in the same period last year, after the company spent $200 million on its own shares during the quarter.
That exceeded Wall Street expectations of 96 cents, according to a survey of analysts by Zacks Investment Research.
Kors has now snapped up shares worth about $1.6 billion and on Wednesday, the company announced a new authorization to acquire $1 billion in shares.
A sheepish outlook from the company was overlooked in light of strong sales and buybacks.
Revenue jumped 10.9 per cent to $1.16 billion thanks to online sales and the new stores, which just edged out projections.
Same-store sales, which are a key indicator of a retailer’s health, rose 0.3 per cent.
For the full year, profit fell 4.7 per cent to $839.1 million, or $4.44 per share, while revenue rose 7.8 per cent to $4.7 billion.
For the current quarter ending in July, Michael Kors Holdings expects its per-share earnings to range from 70 to 74 cents.
The company expects revenue in the range of $940 million to $950 million for the first quarter. Analysts surveyed by Zacks had expected revenue of $1.04 billion.
It expects full-year earnings in the range of $4.56 to $4.64 per share.
The London company also completed its $500 million acquisition of Michael Kors Limited, the exclusive licensee of the company in China and other parts of Asia.
As of April, the company operated 668 retail stores, including concessions, compared to 526 retail stores, including concessions at the end of the same prior-year period.
Shares of Michael Kors Holdings Ltd. have given up a quarter of their value in the past three months with other retailers, including Nordstrom which carries its handbags, reporting dismal sales.
Shares rose 5 per cent to $44.64 in early trading.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on KORS at http://www.zacks.com/ap/KORS
Keywords: Michael Kors Holdings, Earnings Report