Shares in global luxury lifestyle brand Michael Kors Holdings (NYSE:KORS) spiked in premarket trading on the New York Stock Exchange Tuesday after the branded apparel retailer reported a marked uptick in net income for the quarter that ended June 29 on the back of increased same-store sales figures.
The Hong Kong-headquartered maker of clothing and accessories recorded net income for the first quarter of fiscal 2014 of $125 million for earnings per diluted share of 61 cents, compared to the year ago figures of $68.6 million or 34 cents per diluted share.
Revenue for the quarter came in at $640.9 million, way up from the year ago figure of $414.9 million, an increase of 54.5 per cent.
Results beat analyst expectations, which were for earnings per share of 49 cents on revenue of $570.5 million.
Revenue from net sales of $616.25 million rose from the year-ago figure of $397.37 million. Licensing revenue made up the remainder of the total, with $24.6 million recorded in the most recent quarter compared to $17.5 million a year ago.
Retail net sales were up 51.5 per cent to hit $325.7 million on the back of an increase of more than 27 per cent in comparable store sales as well as 75 net new store openings since the end of the first quarter of fiscal 2013. Wholesale net sales increased more than 59 per cent to hit $290.6 million while licensing revenue was up by more than 40 per cent to hit $24.6 million, led by strength in watches and eyewear.
Comparable store sales in the North American stores were up by 25 per cent on a year ago, while sales in the North American wholesale segment increased 50 per cent.
In Europe, sales were up markedly as well, with increasing brand awareness cited as the impetus behind growth of 56 per cent in comparable store sales.
The company included an updated outlook in figures for the quarter, which raised expectations such that for fiscal 2014, the company now expects total revenue to be in the range of $2.8 billion to $2.9 billion, up from the previous forecast of $2.65 billion to $2.75 billion, with diluted earnings of $2.67 to $2.69 per share for the year up from the previous range of $2.43 to $2.47 per share.
The second quarter of the fiscal year is expected to bring in revenue of between $695 million to $705 million.
“Our exceptional first quarter financial results demonstrate the sustained strong demand for the Michael Kors luxury brand,” said chairman and chief executive officer, John D. Idol.
“We attribute the ongoing momentum to our fashion design leadership combined with an aspirational jet-set luxury in-store experience. As we continue to successfully execute on our strategic initiatives, we remain excited about our future growth potential."
Shares in the company were trading up in New York the morning of the release of figures, adding $4.37 per share in pre-market trading for an increase of more than 6 per cent.