Michael KorsSales See Growth in Sales Owing to New Market Strategies & Acquisition

INTERNATIONAL NEWS

Michael KorsSales See Growth in Sales Owing to New Market Strategies & Acquisition


November 11 , 2017



Handbag maker Michael Kors Holdings Ltd beat second-quarter profit and revenue estimates as its turnaround efforts helped reverse a decline in Americas sales for the first time in a year.The company also lifted its full-year revenue forecast to reflect additional sales from its $1.2 billion acquisition of upscale shoemaker Jimmy Choo.The company has forecasted revenue of $4.59 billion for the year ending April 2018. The company, however, now expects Jimmy Choo to contribute up to $225 million to sales for the rest of the year, down from its earlier estimate of about $275 million.Once the hottest name in affordable luxury, Kors has been grappling with declining same-store sales as more people shop online. Over-distribution and a reliance on promotions to boost sales also eroded its brand value and appeal.To reverse a more-than two-year slump in same-store sales, Kors is pursuing a multi-brand strategy for growth. In July, the maker of the popular Mercer and Hamilton handbags announced the deal to buy Jimmy Choo.The company has also pulled back heavily-discounted inventory from department stores and off-price channels, refreshed its line of bags and shut underperforming stores.The efforts helped the company post a smaller-than-expected 1.8 percent drop in same-store sales in the second quarter, compared with a 4.6 percent decline expected by analysts polled by research firm Consensus Metrix. For the key holiday quarter, the company expects Jimmy Choo sales to sum up to $105 million to $110 million.