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Michael Kors boosts Q2 and FY outlook, shares rise

Published: 10:38 21 Sep 2012 EDT

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Michael Kors' (NYSE:KORS) stock grew in early morning trade Friday, just a day after raising its second-quarter and full-year earnings guidance.

The Hong Kong-based retailer, which makes and sells both men and women fashion apparel and accessories under its namesake brand, expects per-share earnings of 38 to 40 cents in the second quarter. 

This is up from a prior view of 33 to 35 cents per share. The quarter ends on September 29.    

Revenue is slated to be around $510 to $520 million. 

Analysts polled by FactSet expect per-share earnings of 36 cents on sales of $492.4 million.

Shares gained 5.58 per cent to $55.42 on the New York Stock Exchange on Friday morning. 

"Our updated guidance reflects our confidence in the strong momentum of the Michael Kors brand and continued execution of our key growth strategies," chief executive John Idol said Friday in a statement.  

"Michael Kors’ luxury fashion designs are resonating globally with our customers and we are excited about the long term growth potential of our company."

In its retail segment, the company said same-store sales for the 11-weeks that ended September 15 hit 45.1 per cent.

In North America, same-store sales rose 45.1 per cent, while Europe and Japan reported comparable sales growth of 49.7 and 16 per cent, respectively.  

Same-store sales are a key metric to measure a retailer's financial health because they exclude any results from shops that recently opened or closed during the year. 

For fiscal 2013, Michael Kors projects per-share diluted earnings of $1.39 to $1.41 per share, up from a prior estimate of $1.32 to $1.34 per share. 

It also foresees revenue to range between $1.85 and $1.95 billion, with comparable store sales growth of about 30 per cent. 

Analysts expect a profit of $1.37 per share for the year on sales of $1.95 billion. 

The retailer is scheduled to report quarterly earnings results on November 13, which falls on a Tuesday.

 

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