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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Capri Holdings Limited | NYSE:CPRI | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-0.39 | -1.12% | 34.41 | 35.00 | 34.54 | 35.00 | 990,565 | 01:00:00 |
Achieved Record Revenue at Versace and Jimmy Choo in Fiscal 2023
Returned $1.35 Billion to Shareholders in Fiscal 2023
https://www.capriholdings.com/4Q23Presentation
Capri Holdings Limited (NYSE:CPRI), a global fashion luxury group, today announced its financial results for the fourth quarter and full year fiscal 2023 ended April 1, 2023.
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20230531005437/en/
(Photo: Business Wire)
Fourth Quarter Fiscal 2023 Highlights
John D. Idol, the Company’s Chairman and Chief Executive Officer said, "Looking back on fiscal 2023, revenue increased high-single-digits and earnings per share increased mid-single-digits. These results were measured on a 52-week constant currency basis. We achieved several milestones in fiscal 2023, including record revenue at Versace and Jimmy Choo as well as mid-single-digit revenue growth at Michael Kors. Additionally, we generated strong free cash flow and returned $1.35 billion to shareholders. These results demonstrate the power of our business model, the strength of our luxury houses and the execution of our strategic initiatives."
Mr. Idol continued, "With Versace, Jimmy Choo and Michael Kors we have three incredibly powerful brands to drive our future growth. While we recognize that there are near-term uncertainties in the Americas, we are encouraged by the strong trends in Asia and continued growth in EMEA. Looking to fiscal 2024, we anticipate revenue will increase low-single-digits and earnings per share will increase mid-single-digits. Beyond fiscal 2024, we remain confident in our ability to achieve our long-term goals over time due to the resilience of the luxury industry, the strength of our three powerful iconic brands and the talented group of employees executing our strategic initiatives."
Fiscal 2023 Financial & Strategic Highlights (1)
(1) Revenue growth rates on a 52-week constant currency basis
Fourth Quarter Fiscal 2023 Results
Financial Results and non-GAAP Reconciliation
The Company’s results are reported in this press release in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) and on an adjusted, non-GAAP basis. A reconciliation of GAAP to non-GAAP financial information is provided at the end of this press release.
Overview of Capri Holdings Fourth Quarter Fiscal 2023 Results
The Company noted that fiscal year 2022 had 53 weeks versus 52 weeks in fiscal year 2023. As a result, the Company's results for the fiscal 2022 fourth quarter and fiscal year ended April 2, 2022, include approximately $70 million in revenue related to the 53rd week.
Versace Fourth Quarter Fiscal 2023 Results
Jimmy Choo Fourth Quarter Fiscal 2023 Results
Michael Kors Fourth Quarter Fiscal 2023 Results
Share Repurchase Authorization
During the fourth quarter, the Company repurchased approximately 8.5 million ordinary shares for approximately $400 million in open market transactions. As of April 1, 2023 the remaining availability under the Company's share repurchase program was $400 million.
Outlook
The following guidance is provided on an adjusted, non-GAAP basis. Financial results could differ materially from the current outlook due to a number of external factors which are not reflected in our guidance, including changes in global macroeconomic conditions, greater than anticipated inflationary pressures, further considerable fluctuations in foreign currency exchange rates, COVID-19 variants and other COVID related disruptions.
Fiscal Year 2024 Outlook
For Capri Holdings, the Company expects the following:
For Versace, the Company expects the following:
For Jimmy Choo, the Company expects the following:
For Michael Kors, the Company expects the following:
First Quarter Fiscal 2024 Outlook
For Capri Holdings, the Company expects the following:
For Versace, the Company expects the following:
For Jimmy Choo, the Company expects the following:
For Michael Kors, the Company expects the following:
Fiscal Year 2024 Outlook
For Capri Holdings, the Company expects the following:
First Half
Second Half
Fiscal Year 2024
Revenue
~$2.6B
~$3.1B
~$5.7B
Adjusted Operating Margin
~13.0%
~19.5%
~16.5%
Adjusted EPS
~$2.50
~$3.90
~$6.40
Conference Call Information
A conference call to discuss fourth quarter and full year fiscal 2023 results is scheduled for today, May 31, 2023 at 8:30 a.m. ET. A live webcast of the conference call will be available on the Company’s website, www.capriholdings.com. In addition, a replay will be available shortly after the conclusion of the call and remain available until June 7, 2023. To access the telephone replay, listeners should dial 1-844-512-2921 or 1-412-317-6671 for international callers. The access code for the replay is 13736113. A replay of the webcast will also be available within two hours of the conclusion of the call and will remain on the website for 90 days. Additionally, a fourth quarter fiscal 2023 earnings highlights presentation is posted on the company's website.
Use of Non-GAAP Financial Measures
Constant currency effects are non-GAAP financial measures, which are provided to supplement our reported operating results to facilitate comparisons of our operating results and trends in our business, excluding the effects of foreign currency rate fluctuations. Because we are a global company, foreign currency exchange rates may have a significant effect on our reported results. We calculate constant currency measures and the related foreign currency impacts by translating the current year’s reported amounts into comparable amounts using prior year’s foreign exchange rates for each currency. All constant currency performance measures discussed below should be considered a supplement to and not in lieu of our operating performance measures calculated in accordance with U.S. GAAP. Additionally, this earnings release includes certain non-GAAP financial measures that exclude certain costs associated with COVID-19 related charges, long-lived asset impairments, ERP implementation costs, Capri transformation costs, restructuring and other charges, charitable donations and the war in Ukraine. The Company uses non-GAAP financial measures, among other things, to evaluate its operating performance and in order to represent the manner in which the Company conducts and views its business. The Company believes that excluding these items helps its management and investors compare operating performance based on its ongoing operations. While the Company considers the non-GAAP measures to be useful supplemental measures in analyzing its results, they are not intended to replace, nor act as a substitute for, any amounts presented in its consolidated financial statements prepared in conformity with U.S. GAAP and may be different from non-GAAP measures reported by other companies.
About Capri Holdings Limited
Capri Holdings is a global fashion luxury group consisting of iconic, founder-led brands Versace, Jimmy Choo and Michael Kors. Our commitment to glamorous style and craftsmanship is at the heart of each of our luxury brands. We have built our reputation on designing exceptional, innovative products that cover the full spectrum of fashion luxury categories. Our strength lies in the unique DNA and heritage of each of our brands, the diversity and passion of our people and our dedication to the clients and communities we serve. Capri Holdings Limited is publicly listed on the New York Stock Exchange under the ticker CPRI.
Forward Looking Statements
This press release contains statements which are, or may be deemed to be, “forward-looking statements.” Forward-looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of the management of Capri Holdings Limited (the “Company”) about future events and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. All statements other than statements of historical facts included herein, may be forward-looking statements. Without limitation, any statements preceded or followed by or that include the words “plans”, “believes”, “expects”, “intends”, “will”, “should”, “could”, “would”, “may”, “anticipates”, “might” or similar words or phrases, are forward-looking statements. These forward-looking statements are not guarantees of future financial performance. Such forward-looking statements involve known and unknown risks and uncertainties that could significantly affect expected results and are based on certain key assumptions, which could cause actual results to differ materially from those projected or implied in any forward-looking statements. These risks, uncertainties and other factors include changes in consumer traffic and retail trends; high consumer debt levels, recession and inflationary pressures; loss of market share and industry competition; the impact of the COVID-19 pandemic, levels of cash flow and future availability of credit, compliance with restrictive covenants under the Company’s credit agreement, the Company’s ability to integrate successfully and to achieve anticipated benefits of any acquisition and to successfully execute our growth strategies; the risk of disruptions to the Company’s businesses; risks associated with operating in international markets and our global sourcing activities, including disruptions or delays in manufacturing or shipments; the risk of cybersecurity threats and privacy of data security breaches; the negative effects of events on the market price of the Company’s ordinary shares and its operating results; significant transaction costs; unknown liabilities; the risk of litigation and/or regulatory actions related to the Company’s businesses; fluctuations in demand for the Company’s products; levels of indebtedness (including the indebtedness incurred in connection with acquisitions); the timing and scope of future share buybacks, which may be made in open market or privately negotiated transactions, and are subject to market conditions, applicable legal requirements, trading restrictions under the Company’s insider trading policy and other relevant factors, and which share repurchases may be suspended or discontinued at any time, the level of other investing activities and uses of cash; fluctuations in the capital markets; fluctuations in interest and exchange rates; the occurrence of unforeseen epidemics and pandemics, disasters or catastrophes; extreme weather conditions and natural disasters; political or economic instability in principal markets; adverse outcomes in litigation; and general, local and global economic, political, business and market conditions including acts of war and other geopolitical conflicts; as well as those risks set forth in the Company’s filings with the U.S. Securities and Exchange Commission (the “SEC”), including the Company’s Annual Report on Form 10-K for the fiscal year ended April 2, 2022 (File No. 001-35368). Any forward-looking statement in this press release speaks only as of the date made and the Company disclaims any obligation to update or revise any forward-looking or other statements contained herein other than in accordance with legal and regulatory obligations.
SCHEDULE 1
CAPRI HOLDINGS LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except share and per share data)
(Unaudited)
Three Months Ended
Fiscal Years Ended
April 1, 2023
April 2, 2022
April 1, 2023
April 2, 2022
Total revenue
$
1,335
$
1,492
$
5,619
$
5,654
Cost of goods sold
468
536
1,895
1,910
Gross profit
867
956
3,724
3,744
Total operating expenses
907
837
3,045
2,841
(Loss) income from operations
(40
)
119
679
903
Other income, net
(1
)
—
(3
)
(2
)
Interest expense (income), net
11
(7
)
24
(18
)
Foreign currency loss
20
7
10
8
(Loss) income before provision for income taxes
(70
)
119
648
915
(Benefit) provision for income taxes
(37
)
38
29
92
Net (loss) income
(33
)
81
619
823
Less: Net income attributable to noncontrolling interests
1
—
3
1
Net (loss) income attributable to Capri
$
(34
)
$
81
$
616
$
822
Weighted average ordinary shares outstanding:
Basic
123,327,209
146,239,474
132,532,009
149,724,675
Diluted
123,327,209
148,757,360
134,002,480
152,497,907
Net income (loss) per ordinary share:
Basic
$
(0.28
)
$
0.55
$
4.65
$
5.49
Diluted
$
(0.28
)
$
0.54
$
4.60
$
5.39
SCHEDULE 2
CAPRI HOLDINGS LIMITED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In millions, except share data)
(Unaudited)
April 1, 2023
April 2, 2022
Assets
Current assets
Cash and cash equivalents
$
249
$
169
Receivables, net
369
434
Inventories, net
1,057
1,096
Prepaid expenses and other current assets
195
192
Total current assets
1,870
1,891
Property and equipment, net
552
476
Operating lease right-of-use assets
1,330
1,358
Intangible assets, net
1,728
1,847
Goodwill
1,293
1,418
Deferred tax assets
296
240
Other assets
226
250
Total assets
$
7,295
$
7,480
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payable
$
475
$
555
Accrued payroll and payroll related expenses
154
165
Accrued income taxes
73
52
Short-term operating lease liabilities
429
414
Short-term debt
5
29
Accrued expenses and other current liabilities
314
351
Total current liabilities
1,450
1,566
Long-term operating lease liabilities
1,348
1,467
Deferred tax liabilities
508
432
Long-term debt
1,822
1,131
Other long-term liabilities
318
326
Total liabilities
5,446
4,922
Commitments and contingencies
Shareholders’ equity
Ordinary shares, no par value; 650,000,000 shares authorized; 224,166,250 shares issued and 117,347,045 outstanding at April 1, 2023; 221,967,599 shares issued and 142,806,269 outstanding at April 2, 2022
—
—
Treasury shares, at cost (106,819,205 shares at April 1, 2023 and 79,161,330 shares at April 2, 2022)
(5,351
)
(3,987
)
Additional paid-in capital
1,344
1,260
Accumulated other comprehensive income
147
194
Retained earnings
5,708
5,092
Total shareholders’ equity of Capri
1,848
2,559
Noncontrolling interest
1
(1
)
Total shareholders’ equity
1,849
2,558
Total liabilities and shareholders’ equity
$
7,295
$
7,480
SCHEDULE 3
CAPRI HOLDINGS LIMITED AND SUBSIDIARIES
CONSOLIDATED SEGMENT DATA
($ in millions)
(Unaudited)
Three Months Ended
Fiscal Years Ended
April 1, 2023
April 2, 2022
April 1, 2023
April 2, 2022
Revenue by Segment and Region:
Versace
The Americas
$
88
$
125
$
408
$
408
EMEA
118
121
468
425
Asia
68
69
230
255
Versace Revenue
274
315
1,106
1,088
Jimmy Choo
The Americas
45
48
196
175
EMEA
62
54
255
229
Asia
44
54
182
209
Jimmy Choo Revenue
151
156
633
613
Michael Kors
The Americas
571
667
2,616
2,627
EMEA
203
219
819
835
Asia
136
135
445
491
Michael Kors Revenue
910
1,021
3,880
3,953
Total Revenue
$
1,335
$
1,492
$
5,619
$
5,654
(Loss) Income from Operations:
Versace
$
14
$
50
$
152
$
185
Jimmy Choo
(7
)
(15
)
38
13
Michael Kors
147
210
868
1,005
Total segment income from operations
154
245
1,058
1,203
Less: Corporate expenses
(62
)
(67
)
(233
)
(190
)
Restructuring and other charges
(5
)
(17
)
(16
)
(42
)
Impairment of long-lived assets
(130
)
(40
)
(142
)
(73
)
Impact of war in Ukraine
—
(9
)
3
(9
)
COVID-19 related charges
3
7
9
14
Total (Loss) Income from Operations
$
(40
)
$
119
$
679
$
903
Operating Margin:
Versace
5.1
%
15.9
%
13.7
%
17.0
%
Jimmy Choo
(4.6
)%
(9.6
)%
6.0
%
2.1
%
Michael Kors
16.2
%
20.6
%
22.4
%
25.4
%
Capri
(3.0
)%
8.0
%
12.1
%
16.0
%
SCHEDULE 4
CAPRI HOLDINGS LIMITED AND SUBSIDIARIES
SUPPLEMENTAL RETAIL STORE INFORMATION
(Unaudited)
As of
Retail Store Information:
April 1, 2023
April 2, 2022
Versace
223
209
Jimmy Choo
237
237
Michael Kors
812
825
Total number of retail stores
1,272
1,271
SCHEDULE 5
CAPRI HOLDINGS LIMITED AND SUBSIDIARIES
CONSTANT CURRENCY DATA
(In millions)
(Unaudited)
Three Months Ended
% Change
April 1, 2023
April 2, 2022
As
Reported
Constant
Currency
Total revenue:
Versace
$
274
$
315
(13.0
)%
(8.6
)%
Jimmy Choo
151
156
(3.2
)%
0.6
%
Michael Kors
910
1,021
(10.9
)%
(8.3
)%
Total revenue
$
1,335
$
1,492
(10.5
)%
(7.5
)%
Fiscal Years Ended
% Change
April 1, 2023
April 2, 2022
As
Reported
Constant
Currency
Total revenue:
Versace
$
1,106
$
1,088
1.7
%
13.8
%
Jimmy Choo
633
613
3.3
%
11.4
%
Michael Kors
3,880
3,953
(1.8
)%
2.0
%
Total revenue
$
5,619
$
5,654
(0.6
)%
5.3
%
SCHEDULE 6
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In millions, except share and per share data)
(Unaudited)
Three Months Ended April 1, 2023
As
Reported
Impairment of Assets
Restructuring and Other Charges (1)
COVID-19 Related Charges
ERP Implementation (2)
Capri Transformation(3)
War in Ukraine
As
Adjusted
Gross profit
$
867
$
—
$
—
$
(3
)
$
—
$
—
$
(1
)
$
863
Operating expenses
$
907
$
(130
)
$
(5
)
$
—
$
(5
)
$
(24
)
$
(1
)
$
742
Total (loss) income from operations
$
(40
)
$
130
$
5
$
(3
)
$
5
$
24
$
—
$
121
Foreign currency loss (gain)
$
20
$
—
$
(14
)
$
—
$
—
$
—
$
—
$
6
(Loss) income before provision for income taxes
$
(70
)
$
130
$
19
$
(3
)
$
5
$
24
$
—
$
105
(Benefit) for income taxes
$
(37
)
$
12
$
5
$
(1
)
$
1
$
3
$
—
$
(17
)
Net (loss) income attributable to Capri
$
(34
)
$
118
$
14
$
(2
)
$
4
$
21
$
—
$
121
Weighted average diluted ordinary shares outstanding
123,327,209
124,859,442
Diluted net (loss) income per ordinary share - Capri
$
(0.28
)
$
0.95
$
0.11
$
(0.02
)
$
0.04
$
0.17
$
—
$
0.97
______________________
(1)
Amounts impacting operating expenses primarily includes charges recorded in connection with the acquisition of Gianni Versace S.r.l. The foreign currency exchange loss represents a charge recognized in conjunction with restructuring activities to rationalize certain legal entities within our structure.
(2)
Represents a multi-year ERP implementation which includes accounting, finance and wholesale and retail inventory solutions in order to create standardized finance IT applications across our organization. This ERP implementation will continue through Fiscal 2026 and we expect expenditures up to $170 million over the next three fiscal years.
(3)
The Capri transformation program represents a multi-year, multi-project initiative extending through Fiscal 2026 intended to improve the operating effectiveness and efficiency of our organization by creating best in class shared platforms across our brands and by expanding our digital capabilities. These initiatives cover multiple aspects of our operations including supply chain, marketing, omni-channel customer experience, e-commerce, data analytics and IT infrastructure. Over the next three fiscal years, we expect expenditures up to $220 million related to these efforts.
SCHEDULE 7
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In millions, except share and per share data)
(Unaudited)
Fiscal Year Ended April 1, 2023
As
Reported
Impairment of Assets
Restructuring and Other Charges (1)
COVID-19 Related Charges
ERP Implementation (2)
Capri Transformation(3)
War in Ukraine
As
Adjusted
Gross profit
$
3,724
$
—
$
—
$
(9
)
$
—
$
—
$
(1
)
$
3,714
Operating expenses
$
3,045
$
(142
)
$
(16
)
$
—
$
(25
)
$
(58
)
$
2
$
2,806
Total income from operations
$
679
$
142
$
16
$
(9
)
$
25
$
58
$
(3
)
$
908
Foreign currency loss (gain)
$
10
$
—
$
(14
)
$
—
$
—
$
—
$
—
$
(4
)
Income before provision for income taxes
$
648
$
142
$
30
$
(9
)
$
25
$
58
$
(3
)
$
891
Provision for income taxes
$
29
$
14
$
8
$
(2
)
$
6
$
13
$
(1
)
$
67
Net income attributable to Capri
$
616
$
128
$
22
$
(7
)
$
19
$
45
$
(2
)
$
821
Diluted net income per ordinary share - Capri
$
4.60
$
0.96
$
0.16
$
(0.05
)
$
0.13
$
0.34
$
(0.01
)
$
6.13
______________________
(1)
Amounts impacting operating expenses primarily includes charges recorded in connection with the acquisition of Gianni Versace S.r.l. The foreign currency exchange loss represents a charge recognized in conjunction with restructuring activities to rationalize certain legal entities within our structure.
(2)
Represents a multi-year ERP implementation which includes accounting, finance and wholesale and retail inventory solutions in order to create standardized finance IT applications across our organization. This ERP implementation will continue through Fiscal 2026 and we expect expenditures up to $170 million over the next three fiscal years.
(3)
The Capri transformation program represents a multi-year, multi-project initiative extending through Fiscal 2026 intended to improve the operating effectiveness and efficiency of our organization by creating best in class shared platforms across our brands and by expanding our digital capabilities. These initiatives cover multiple aspects of our operations including supply chain, marketing, omni-channel customer experience, e-commerce, data analytics and IT infrastructure. Over the next three fiscal years, we expect expenditures up to $220 million related to these efforts.
SCHEDULE 8
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In millions, except share and per share data)
(Unaudited)
Three Months Ended April 2, 2022
As Reported
Impairment of Assets
Restructuring and Other Charges (1)
Charitable Donations
COVID-19 Related Charges
ERP Implementation
Capri Transformation
War in Ukraine
As Adjusted
Gross profit
$
956
$
—
$
—
$
—
$
(7
)
$
—
$
—
$
2
$
951
Operating expenses
$
837
$
(40
)
$
(17
)
$
(10
)
$
—
$
(8
)
$
(16
)
$
(7
)
$
739
Total income from operations
$
119
$
40
$
17
$
10
$
(7
)
$
8
$
16
$
9
$
212
Income before provision for income taxes
$
119
$
40
$
17
$
10
$
(7
)
$
8
$
16
$
9
$
212
Provision for income taxes
$
38
$
8
$
6
$
—
$
6
$
2
$
—
$
—
$
60
Net income attributable to Capri
$
81
$
32
$
11
$
10
$
(13
)
$
6
$
16
$
9
$
152
Diluted net income per ordinary share - Capri
$
0.54
$
0.22
$
0.07
$
0.07
$
(0.09
)
$
0.04
$
0.11
$
0.06
$
1.02
______________________
(1)
Includes store closure costs which have been incorporated into the Capri Retail Store Optimization Program, other restructuring initiatives and other costs recorded in connection with the acquisition of Gianni Versace S.r.l.
SCHEDULE 9RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In millions, except share and per share data)
(Unaudited)
Fiscal Year Ended April 2, 2022
As Reported
Impairment of Assets
Restructuring and Other Charges(1)
Charitable Donations
COVID-19 Related Charges
ERP
Implementation
Capri Transformation
War in Ukraine
As Adjusted
Gross profit
$
3,744
$
—
$
—
$
—
$
(16
)
$
—
$
—
$
2
$
3,730
Operating expenses
$
2,841
$
(73
)
$
(42
)
$
(10
)
$
(2
)
$
(19
)
$
(31
)
$
(7
)
$
2,657
Total income from operations
$
903
$
73
$
42
$
10
$
(14
)
$
19
$
31
$
9
$
1,073
Income before provision for income taxes
$
915
$
73
$
42
$
10
$
(14
)
$
19
$
31
$
9
$
1,085
Provision for income taxes
$
92
$
16
$
8
$
—
$
6
$
6
$
9
$
—
$
137
Net income attributable to Capri
$
822
$
57
$
34
$
10
$
(20
)
$
13
$
22
$
9
$
947
Diluted net income per ordinary share - Capri
$
5.39
$
0.37
$
0.22
$
0.07
$
(0.13
)
$
0.09
$
0.14
$
0.06
$
6.21
______________________
(1)
Includes store closure costs which have been incorporated into the Capri Retail Store Optimization Program, other restructuring initiatives and other costs recorded in connection with the acquisition of Gianni Versace S.r.l.
View source version on businesswire.com: https://www.businesswire.com/news/home/20230531005437/en/
Investor Relations: Jennifer Davis +1 (201) 514-8234 Jennifer.Davis@CapriHoldings.com
Media: Dinesh Kandiah +1 (917) 934-2427 Press@CapriHoldings.com
1 Year Capri Chart |
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