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Dec 28, 2019
Capri Q3 2020 Earnings Report
Revenue and adjusted earnings per share exceeded expectations.
Key Takeaways
Capri Holdings Limited reported a 9.2% increase in third quarter revenue, driven by the addition of Versace and growth from Jimmy Choo, with Michael Kors revenue performing better than anticipated. Adjusted earnings per share were $1.66, surpassing expectations.
Third quarter revenue growth of 9.2%.
Third quarter adjusted earnings per share of $1.66.
Repaid approximately $300 million of debt in the third quarter, and approximately $500 million year-to-date.
The company anticipates annual revenue of approximately $5.65 billion and adjusted earnings per share of $4.45 to $4.50.
Capri
Capri
Capri Revenue by Segment
Capri Revenue by Geographic Location
Revenue by Segment
Michael Kors Revenue
CapyFin.comJimmy Choo Revenue
CapyFin.comRevenue by Geographic Location
Americas Revenue
CapyFin.comEMEA Revenue
CapyFin.comAsia Revenue
CapyFin.com Forward Guidance
The company expects the situation in China to reduce revenue by approximately $100 million and earnings per share by $0.40 to $0.45 for the fourth quarter and full year. For the fourth quarter of fiscal year 2020, total revenue is expected to be approximately $1.3 billion and diluted earnings per share of $0.68 to $0.73.
Positive Outlook
- Versace revenue of approximately $210 million with a positive operating margin.
- Jimmy Choo revenue of approximately $130 million.
- Jimmy Choo operating margin improvement reflecting expense leverage and the normalization of strategic investments.
- Net interest expense of approximately $0 million.
- Effective tax rate of approximately 7%.
Challenges Ahead
- Outbreak of coronavirus in China which the Company expects will materially impact its financial results.
- Situation in China is expected to reduce revenue by approximately $100 million and earnings per share by $0.40 to $0.45 for the fourth quarter and full year.
- Michael Kors revenue of approximately $950 million.
- Michael Kors operating margin to be below prior year due to the impact of the situation in China, partially offset by cost reductions associated with the fleet optimization program.
- Operating margin of approximately 9.0%.
Revenue & Expenses
Visualization of income flow from segment revenue to net income