Capri Holdings Ltd.’s stock erased early premarket gains to trade down 2% Wednesday, after the parent of the Michael Kors, Versace and Jimmy Choo brands swung to a loss in its fiscal fourth-quarter as revenue slid more than 10%.
Revenue fell at all three brands, and the company
CPRI,
highlighted a challenging environment in its home market, contrasting with strength in China. Other retailers have highlighted the recovering Chinese market, which was still mostly shut down a year ago due to COVID lockdowns.
“While we recognize that there are near-term uncertainties in the Americas, we are encouraged by the strong trends in Asia and continued growth in EMEA,” CEO John Idol said in a statement.
The company posted a net loss of $34 million, or 28 cents a share, for the quarter to April 1, after income of $81 million, or 54 cents a share, in the year-earlier period. Its adjusted per-share earnings came to 97 cents, ahead of the 94 cent FactSet consensus.
Revenue fell 10.5% to $1.335 billion, but topped the $1.278 billion FactSet consensus.
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Net inventory was down 3.6% to $1.057 billion.
Versace revenue fell 13% to $274 million in the quarter, while Jimmy Choo revenue was down 3.2% to $151 million. At Michael Kors, revenue fell 10.9% to $910 million.
The company is now expecting fiscal 2024 revenue of about $5.7 billion, matching the FactSet consensus. It expects EPS of about $6.40, ahead of the $6.24 FactSet consensus.
It expects “modest” gross margin expansion and capex of about $260 million.
The company repurchased about 8.4 millions shares in the quarter for about $400 million. As of April 1, it has $400 million remaining availability in its stock buyback program.
The stock has fallen 31% in the year to date, while the S&P 500
SPX,
has gained 9.5%.
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This story originally appeared on Marketwatch
