Michael Kors lifts revenue forecast, shares soar

Industries Reuters

(REUTERS)

U.S. fashion accessories maker Michael Kors Holdings Ltd posted a better-than-expected quarterly profit and revenue on Tuesday and lifted its annual revenue forecast.

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Shares of New-York-based Kors were up 12.4 percent at $41.85 in premarket trade after the company also reported a smaller-than-expected drop in quarterly sales at established stores.

The company, which agreed to buy luxury shoemaker Jimmy Choo Plc last month, said the deal would add about $275 million to Kors' revenue in the second half of the year ending March 2018, assuming the acquisition is completed by the third fiscal quarter.

This is the first time Kors has provided a financial forecast related to the deal, which was announced last month.

Kors said it now expects fiscal 2018 revenue of about $4.28 billion, slightly higher than the $4.25 billion it had previously expected. The forecast does not include results from Jimmy Choo.

Kors reported a 5.9 percent decrease in sales at established stores in the first quarter ended July 1. Analysts on average had expected an 8.9 percent decline, according to Consensus Metrix.

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Same-store sales were driven by better-than-expected sales in North America and Europe, Kors Chief Executive John Idol said in a statement.

Net income attributable to the company fell 15 percent to $125.5 million, or 80 cents per share.

Total revenue dipped 3.6 percent to $952.4 million.

Analysts on average had expected earnings of 62 cents per share and revenue of $918.6 million, according to Thomson Reuters I/B/E/S. (Reporting by Siddharth Cavale and Karina Dsouza in Bengaluru; Editing by Sai Sachin Ravikumar)

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