Ralph Lauren Corp said it expects lower wholesale sales this fiscal year, hurt by a slowdown in Europe and the closure of some China wholesale operations it will eventually replace with its own stores.

Photo: Ralph Lauren

The clothing company and retailer expects revenue for the current fiscal year, begun April 1, to be up by a "mid-single digit" percentage, compared with a 20 percent rise in the previous year.

Wholesale sales will edge down, while retail sales should be up by a low-double-digit percentage, it said.

Ralph Lauren shares fell 3.8 percent to $140.77 in premarket trading.

The company expects sales to be hurt by its having fewer distribution points in China. It is in middle of an overhaul of its business in China, closing most of the locations where its products are sold with the intention of replacing them with higher-end shops over which it will have more control.

Sales will also take a hit from J.C. Penney Co Inc's plans to dump Ralph Lauren's "American Living" brand later this year.

For the fiscal fourth quarter, ended March 31, the company reported a higher quarterly profit, helped by double-digit sales growth at its own stores and large gains in its Internet business.

It also said it is doubling its quarterly dividend to 40 cents per share.

Ralph Lauren, with brands like Polo, Club Monaco and Chaps that range from mid-tier basics to high-end luxury labels, said revenue rose 13.7 percent to $1.62 billion.

The sales charge was led by a 12 percent gain at stores open at least a year, with sales at Club Monaco stores rising the most.

Net income was $94.4 million, or 99 cents per share, compared with $73.2 million, or 74 cents per share, a year earlier. That was 15 cents better than the average Wall Street forecast, according to Thomson Reuters I/B/E/S.