Feb 4, 2015
Ralph Lauren cuts full-year revenue growth forecast again
Feb 4, 2015
Luxury fashion house Ralph Lauren Corp cut its full-year revenue growth forecast for the second time in less than four months, blaming a strong dollar and weak consumer spending.
Shares of the company, which also reported lower-than-expected quarterly revenue and profit, fell as much as 12 percent in early trading.
Ralph Lauren, whose brands include Polo Ralph Lauren, Club Monaco, American Living and Chaps, said it expected revenue to grow at about 4 percent on a constant currency basis in the year ending March.
The company had cut its full-year revenue growth forecast in October to 5-7 percent from 6-8 percent.
"Foreign exchange and global consumer spending remain unpredictable, and we are planning our business accordingly," Chief Operating Officer Jacki Nemerov said in a statement on Wednesday.
"While we are cautious with our outlook, we are bold with our actions to offset some of these ongoing external pressures. Over the next several months, we will implement a new, carefully considered, global brand management structure that we are confident will enable us to operate in a more customer-centric way and provide substantial operating efficiencies," he continued.
Ralph Lauren had about 11,450 points-of-sale as of March 29, of which about 5,000 were in Europe and Asia.
After hitting a six-and-a-half-month low in May, the dollar has surged about 20 percent against a basket of major currencies.
Ralph Lauren, which also makes accessories and fragrances, reported a 2 percent fall in same-store sales in the third quarter ended Dec. 27.
The company's net income fell 9.3 percent to $215 million, or $2.41 per share.
Ralph Lauren said promotional environment in the United States, coupled with increased investments in store openings and its e-commerce business, hurt profit in the holiday quarter.
Revenue rose 0.9 percent to $2.03 billion.
Analysts on average had expected a profit of $2.50 per share and revenue of $2.9 billion, according to Thomson Reuters I/B/E/S.
Ralph Lauren's shares were down 11 percent at $152 in early trading on the New York Stock Exchange.
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