Capri Holdings Limited is the latest company to reveal a mixed bag this quarter.
The fashion group — parent to the Michael Kors, Versace and Jimmy Choo brands — revealed quarterly earnings Tuesday before the market opened, improving on top-line revenues as demand for luxury goods remains strong. But continued supply chain disruptions and rising prices cut into quarterly profits.
Still, investors didn’t seem to mind. Shares of Capri were up nearly 8 percent during pre-market trading.
“We are pleased with our first quarter performance with revenue, gross margin, operating margin and earnings per share all exceeding our expectations,” John D. Idol, Capri’s chairman and chief executive officer, said in a statement. “Better-than-anticipated results were driven by strong momentum across all three luxury houses, reflecting the power of our brands as they continue to deepen consumer desire and engagement.”
Revenues for the first quarter ending July 2 grew 8.5 percent to $1.36 billion, up from $1.25 billion a year ago. By brand, sales at Versace grew 14.6 percent to $275 million, up from $240 million a year ago. At Jimmy Choo, revenues rose 21.1 percent to $172 million, up from $142 million, while Michael Kors revenues increased 4.8 percent to $913 million, up from $871 million. Across all brands, the biggest drops in revenue stemmed from the Asia region.
Profits fell to $201 million, down from $219 million a year ago.
In the current quarter, the company is anticipating total sales will be roughly $1.4 billion — or about $300 million at Versace, $140 million at Jimmy Choo and $960 million at Michael Kors. For the full year, Capri expects total revenues of $5.85 billion — or $1.17 billion at Versace, $650 million at Jimmy Choo and more than $4 billion at Michael Kors.
“Looking forward, we remain optimistic about the long-term growth potential for Versace, Jimmy Choo and Michael Kors,” Idol said. “With our portfolio of iconic, founder-led fashion luxury brands, Capri Holdings is positioned to deliver multiple years of revenue and earnings growth.”
The retailer ended the quarter with 1,265 brick-and-mortar locations, $221 million in cash and cash equivalents and $1.38 billion in long-term debt.
Shares of Capri Holdings, which closed up 2.8 percent Monday to $50.99, are down 12.5 percent, year-over-year.