Michael Kors' growth spurt pressurizes profit margin | RetailDetail

Michael Kors' growth spurt pressurizes profit margin

Michael Kors' growth spurt pressurizes profit margin

American jet-set fashion brand Michael Kors has had a 54 % turnover growth in the past quarter, thanks to a large number of new stores and the brand's increasing popularity. Profit margins have dropped because of increased costs.

Quarterly turnover up 54 %

Michael Kors is doing very well, as the demand for its luxurious fashion accessories and watches is growing, both in its own stores (405 compared to 304 one year ago) and in department stores across the United States and Europe.

 

Its quarterly turnover (up until 29 March) reached 917.5 million dollars, nearly 675 million euro, a 54 % increase. American turnover grew 43 % to 739.97 million dollars, while European turnover more than doubled (+125.3 %) to 164.65 million dollars.

 

The like-for-like turnover grew 26 % (20.6 % in the United States, 62.7 % in Europe), which means it outperformed analysts' expectations at 21 %, the tenth quarter in a row Michael Kors has beaten those expectations.

 

There is a downside to all this positive news: the gross profit margin is "slightly lower", both for the quarter and for the year, while the operational costs "have grown a bit", the company stated during a conference call.

Questions or comments? Please feel free to contact the editors


Carrefour Belgium launches personal shoppers with 90 minutes delivery

19/07/2018

In the intense struggle for the customers' favour, Carrefour Belgium has presented a new service - featuring personal shoppers, delivery within 90 minutes and an app that can be expanded into a market place.

Cultured meat in stores by 2021?

18/07/2018

Commercialization of laboratory cultured meat is coming closer. Pioneer Mosa Meat has raised 7.5 million euros for the construction of a factory that will bring an affordable product to the market within three years.

Aldi commits to renewable energy

17/07/2018

Aldi Nord has published an ambitious international climate policy: the retailer wants to reduce greenhouse gas emissions by 40% by 2021 and reveals some compelling figures in its second sustainability report.

Discounters' major opportunities for growth in Western Europe

16/07/2018

Despite the multitude of stores in most European markets, discounters plan to open up to ten million square metres of store surface in five years' time. Even in so-called saturated markets they still see a lot of chances for growth, LZ Retailytics says.

Contamination bites huge chunks of Greenyard's value

16/07/2018

Vegetable producer Greenyard is under attack after a listeria contamination in its Hungarian factory. The company says to have taken all necessary measures, but the share price plummets.

Starbucks dumps plastic straws worldwide

12/07/2018

American coffee company Starbucks will ban plastic straws in their stores starting from 2020. A small step for coffee enthusiasts, but a big step for the environment, as the coffee giant uses about a billion straws every year.