Luxury giant Capri (Jimmy Choo, Michael Kors, Versace) has achieved record results in its financial year 2022. After a loss last year, Capri now posted a net profit of 823 million dollars (770 million euros), while turnover rose by a quarter to 5.7 billion dollars (5.3 billion euros).
Like many luxury companies, Capri does not seem to be suffering from the crisis at all. In its fiscal year 2022, which ended in April, the company’s sales rose to record levels. In the most recent quarter – when the war in Ukraine and rising inflation were already playing a major role – sales rose by an additional 24.6 % to just under 1.5 billion dollar mark (1.4 billion euros). Michael Kors brought in the lion’s share; Versace (315 million dollars, + 34 %) and Jimmy Choo (156 million dollars, + 26 %) sold less but managed to grow faster.
In a press release, CEO John Idol said he was proud of the performance of his luxury houses: “Capri Holdings achieved the highest revenue, gross margin and earnings per share in the company’s history. Additionally, we generated strong free cash flow and returned 650 million to shareholders in fiscal 2022. Our ability to deliver record results while navigating the challenges of an unprecedented global pandemic is a testament to the strength of our brands and the success of our strategic growth initiatives.”
Seven billion in turnover
For the new financial year, Capri expects a slowdown in sales growth: with an additional 5 %, the six billion dollar mark would stay just out of reach. Margins should also remain roughly the same at 18 %. In the longer term, however, the CEO is confident: “Longer term we are confident in our ability to resume double digit revenue increases as we move beyond the impact of current macro headwinds. The power of Versace, Jimmy Choo and Michael Kors as well as the proven resilience of the luxury market reinforce our optimism for the future and our ability to achieve $7 billion in revenue and a 20% operating margin over time.”
Capri Holdings was formed in early 2019 when Michael Kors acquired Versace, a year after the acquisition of Jimmy Choo. The luxury brands did suffer at the start of the coronavirus pandemic, but managed to recover very quickly.