Ralph Lauren (RL) Tops Q1 EPS by 10c, Offers Outlook

Ralph Lauren (NYSE: RL) reported Q1 EPS of $1.09, $0.10 better than the analyst estimate of $0.99. Revenue for the quarter came in at $1.62 billion versus the consensus estimate of $1.61 billion. Sames store sales were down 8%, down 2% in constant currency.

Fiscal 2016 Outlook

The Company continues to expect consolidated net revenues for Fiscal 2016 to increase by mid-single digits in constant currency. Based on current exchange rates, foreign currency will have an approximate 450 basis point negative impact on Fiscal 2016 revenue growth. Operating margin for Fiscal 2016 is still expected to be 180-230 basis points below the prior year’s level due to negative foreign currency effects. The full year Fiscal 2016 tax rate is estimated at 30%.

This guidance excludes restructuring and non-cash charges associated with our global brand reorganization. We expect these charges to be approximately $70-100 million over the course of Fiscal 2016.

In the second quarter of Fiscal 2016, the Company expects consolidated net revenues to be up 3-5% in constant currency, and based on current exchange rates, foreign currency will have an approximate 550 basis point negative impact on revenue growth. Operating margin for the second quarter of Fiscal 2016 is expected to be approximately 275-325 basis points below the comparable prior year period, primarily due to negative foreign currency effects, the quarterly revenue growth profile and timing of expense savings initiatives. The second quarter tax rate is estimated at 30%

For earnings history and earnings-related data on Ralph Lauren (RL) click here.

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