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Capri Holdings Q4 earnings and revenue miss analyst estimates

EditorRachael Rajan
Published 05/30/2024, 06:28 PM
© Reuters.

LONDON - Capri Holdings Limited (NYSE:CPRI), home to luxury fashion brands such as Versace, Jimmy Choo, and Michael Kors, reported a decline in revenue for the fourth quarter of the fiscal year 2024.

The company saw its revenue drop by 8.4% to $1.223 billion, a significant decrease from the $1.335 billion reported in the same quarter of the previous year. This decline also fell short of the analyst consensus estimate of $1.29 billion.

Adjusted earnings per share (EPS) for the quarter stood at $0.42, which was below the analyst estimate of $0.67. The company's adjusted operating margin also experienced a downturn, reported at 6.4% compared to 9.1% in the prior year.

John D. Idol, Chairman and Chief Executive Officer of Capri Holdings, expressed disappointment with the fourth-quarter performance, attributing the decline to a global softening in demand for luxury fashion goods. Despite the dip in sales, Idol highlighted the addition of 11.6 million new consumers across the company's databases, marking a 14% growth compared to last year. He emphasized the strong brand equity and enduring value of the company's luxury houses.

The financial results provided a bleak picture of the company's performance, with net loss widening to $472 million, or -$4.03 per diluted share, impacted by non-cash impairments. This is a stark contrast to the net loss of $34 million, or -$0.28 per diluted share, in the prior year. Gross profit margin saw a decrease, primarily driven by lower full-price sell-throughs.

In terms of individual brand performance, Versace's revenue decreased by 3.6% on a reported basis and 2.9% on a constant currency basis. Jimmy Choo's revenue fell by 9.3%, and Michael Kors experienced a 9.7% decline on a reported basis and a 9.2% decrease on a constant currency basis.

Looking ahead, Capri Holdings did not provide financial guidance due to the pending merger transaction with Tapestry (NYSE:TPR), Inc. However, the company anticipates free cash flow to normalize in Fiscal 2025. Idol concluded with remarks on the proposed acquisition by Tapestry, which is currently facing a legal challenge from the FTC. He reiterated the company's disagreement with the FTC's decision and the belief in the benefits of the merger for shareholders and employees.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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