Ralph Lauren sees strong Q1
Thursday, 07 August 2008
Ralph Lauren posted a 7.8 percent increase in first-quarter profits, driven by Polo’s retail operations and sales at higher profit margins. Ralph Lauren, chairman and chief executive officer, said worldwide acceptance of Polo’s brands has been “supported by our continued investment in advertising,
marketing and public relations, including high-profile events such as Wimbledon and the Olympics. Our status as one of the world’s few truly global luxury lifestyle brands is an incredible asset for our company.”
For the three months ended June 28, net income rose to $95.2 million, or 93 cents a diluted share, beating the consensus estimate of 72 cents from Yahoo Finance. That compares with $88.3 million, or 82 cents, in the year-ago quarter. The company said the growth was from a higher gross margin rate and a lower tax rate.
On a conference call with analysts, Roger Farah, president and chief operating officer, said, “Our first quarter reflects the successful benefits of our long-term strategic initiatives — primarily our commitment to new merchandise development and product innovation, our ongoing attempts to expand our direct-to-consumer and our growing international presence. This multipronged strategy is designed to diversify our businesses, reduce our exposure to any one region of the world or channel of distribution and to give us more direct control over our brands.”
“Our inventories are very well managed, as they are below last year, and at the same time, our retail sell-through rates have been strong and our profit margins have benefited as a result,” he said. “Our cash flows have grown with more direct control [that] we now have over our businesses, and we have made the right decisions in order to deliver a very strong balance sheet with large growing cash balances and very little debt. Our entire management team has supported and delivered on these key short-term operating priorities. Because of this cross-functional discipline, we are comfortable pursuing our long-term initiatives.”
Image: Ralph Lauren 40 years
