Upcoming AWS Coverage on PVH Corp. Post-Earnings Results

LONDON, UK / ACCESSWIRE / November 21, 2016 / Active Wall St. announces its post-earnings coverage on Michael Kors Holdings Ltd. (NYSE: KORS). The company released its second quarter fiscal 2017 (Q2 FY17) earnings on November 10, 2016. The London, U.K.-based company's total revenue fell 3.7% y-o-y; however retail net sales grew 12.1% y-o-y. Register with us now for your free membership at: http://www.activewallst.com/register/.

One of Michael Kors Holdings' competitors within the Textile - Apparel Clothing space, PVH Corp. (NYSE: PVH), will release its Q3 2016 earnings results on Wednesday, November 30, 2016 after the market closes. The company will have conference call on Thursday, December 1, 2016, from 9:00 A.M. ET, hosted by Emanuel Chirico, Chairman and Chief Executive Officer, and Michael Shaffer, Executive Vice President and Chief Operating & Financial Officer, to discuss the company's results. AWS will be initiating a research report on PVH Corp. in the coming days.

Today, AWS is promoting its earnings coverage on KORS; touching on PVH. Get our free coverage by signing up to:

http://www.activewallst.com/registration-3/?symbol=KORS

http://www.activewallst.com/registration-3/?symbol=PVH

Earnings Reviewed

During the Q2 FY17, Michael Kors' reported total revenue of $1.09 billion, down 3.7% compared to $1.13 billion in Q2 FY16. Total revenue number for Q2 FY17 came in marginally above market expectations of $1.08 billion. In the reported quarter, net sales came in at $1.05 billion compared to $1.09 billion in the year ago period. Furthermore, comparable sales decreased 5.4% in the reported period.

The global luxury accessories, footwear and apparel company's net income attributed to Michael Kors for Q2 FY17 came in at $160.9 million, or $0.95 per diluted share, which was below $193.1 million, or $1.01 per diluted share, reported in the prior year's comparable quarter. However, the company's net income beat market consensus estimate of $0.88 per diluted share.

Operating Metrics

The company's Q2 FY17 gross profit was $644.7 million compared to $664.5 million in the previous year's quarter. Gross margin as a percentage of total revenue for Q2 FY17 improved to 59.2% from 58.8% in Q2 FY16. In the reported period, foreign currency translation and transaction favorably impacted gross profit margin by approximately 80 basis points. In Q2 FY17, operating income fell to $203.7 million, or 18.7% of total revenue, compared to $273.1 million, or 24.2% of total revenue, in Q2 FY16.

As on October 1, 2016, the company operated 787 retail stores, including concessions, compared to 589 retail stores, including concessions, at the end of the prior year's same period.

Segment-Wise

During Q2 FY17, total retail net sales improved 12.1% to $597.2 million from $532.8 million in Q2 FY16, primarily due to the addition of 198 net new stores since the second quarter of last year. During the quarter, the segment's operating margin was 11.7% compared to 18.8% in the last period.

Total wholesale net sales were down to $452.2 million in Q2 FY17 from $554.0 million in the year ago period. In Q2 FY17, wholesale net sales in Europe improved 3% y-o-y, while declining 22% y-o-y and 43% y-o-y in Americas and Asia region, respectively. Furthermore, wholesale operating margin was down to 27.0% in Q2 FY17 from 28.3% in the prior year's same period.

Licensing revenue decreased 10.2% y-o-y to $38.8 million in Q2 FY17. Additionally, the segment's operating margin fell to 31.2% in Q2 FY17 from 37.7% in the prior year's period, primarily due to increased costs associated with advertising as well as increased depreciation expense.

Balance Sheet

As on October 01, 2016, the company had $186.4 million in cash and cash equivalents compared to a balance of $431.5 million as on September 26, 2015. Additionally, the company had not reported any long-term debt in its books of accounts as on October 29, 2016, while it had long-term debt amounting to $4.1 million as on September 26, 2015.

Share Repurchases

During Q2 FY17, Michael Kors' repurchased approximately 5.02 million shares of its common stock for a total of approximately $250.0 million. As on October 01, 2016, the company had a balance of approximately $350.0 million under its share repurchase authorization.

Earnings Outlook

In its outlook for Q3 FY17, Michael Kors' management expects total revenue to be between $1.37 billion and $1.38 billion with operating margin of approximately 25.0%. Diluted earnings for Q3 FY17 are projected to be in the range of $1.61 per share to $1.65 per share.

For full-year FY17, the company forecasts total revenue to be approximately $4.55 billion, while comparable sales are anticipated to decrease in the mid-single digit range. Michael Kors projects non-GAAP operating margin to be approximately 20.7%. Furthermore, non-GAAP diluted earnings for FY17 is expected to be in the range of $4.37 per share and $4.43 per share, whereas GAAP diluted earnings for FY17 is forecasted to be in the range of $4.32 per share to $4.38 per share.

Stock Performance

Michael Kors' share price finished yesterday's trading session at $47.57, falling 2.06%. A total volume of 2.31 million shares exchanged hands. The stock has advanced 14.60% and 16.36% in the last six months and past twelve months, respectively. Furthermore, since the start of the year, shares of the company have surged 18.75%. The stock is trading at a PE ratio of 10.91 and has a market capitalization of $7.98 billion.

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SOURCE: Active Wall Street