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Michael Kors beats by $0.13, beats on revs; guides Q4 below consensus
- Reports Q3 (Dec) earnings of $1.59 per share, $0.13 better than the Capital IQ Consensus of $1.46; revenues rose 6.3% year/year to $1.4 bln vs the $1.36 bln Capital IQ Consensus. On a constant currency basis, total revenue increased 9.9% vs. mid single digit guidance. Retail net sales increased 11.1% to $766.2 million driven primarily by e-commerce sales from the Company's digital flagships and 114 net new store openings since the end of the third quarter of fiscal 2015.
- Comparable store sales decreased 0.9% vs. negative mid single digit decline guidance. On a constant currency basis, retail net sales grew 15.7%, and comparable store sales increased 2.0%. Wholesale net sales increased 0.3% to $575.5 million and on a constant currency basis, wholesale net sales grew 3.0%. Licensing revenue increased 8.4% to $55.8 million.
- Total revenue in the Americas increased 0.4% to $1.06 billion on a reported basis and increased 1.4% on a constant currency basis. European revenue grew 14.3% to $276.0 million on a reported basis, and grew 29.1% on a constant currency basis. Revenue in Japan increased 59.1% to $25.5 million on a reported basis, and increased 68.0% on a constant currency basis.
- Co issues downside guidance for Q4, sees EPS of $0.93-0.97 vs. $1.00 Capital IQ Consensus Estimate; sees Q4 revs $1.13-1.15 bln vs. $1.16 bln Capital IQ Consensus Estimate. On a constant currency basis, total revenue is expected to increase in the high-single digit range assuming an impact of ~$20 million from the change in foreign currency rates. The Company expects comparable store sales to be flat on a reported basis and to increase in the low single digits on a constant currency basis.