Ralph Lauren's first quarter earnings improved significantly
Stefan Larsson, who has disagreed with Ralph Lauren, founder, chairman and chief creative officer of the group, Procter & Gamble Co. (NYSE:PG), the former CEO of Procter & Gamble Group in June this year, is continuing his predecessor. Restructuring framework, striving to speed up the response of the supply chain to fashion trends, cutting off non-core product lines such as Denim & Supply to focus on well-known brands such as Polo Ralph Lauren, reducing the dependence on wholesale distribution of department stores over the years, ending US department store 20 %-25% of the point of sale, and a SKU that cuts 20% from the fall series, gives way to higher gross margin products. In the first quarter of July 1, Ralph Lauren Corp.'s inventory level decreased significantly by 30.7% year-on-year, from $1,041.5 million in the same period last year to $830.4 million. The adjusted gross profit margin improved by 210 basis points to 63.2%. Operating expenses fell by 13.0% year-on-year, operating profit and net profit turned profitable, reaching $90.3 million and $59.5 million, respectively, compared with a loss of $31.2 million and $22.3 million in the same period last year. The EPS improved from -0.27 USD to US$0.72 in the same period last year, and the adjusted EPS was US$1.11, far exceeding the market expectation of US$0.94. Net income fell 13.2% year-on-year to US$1,347.1 million, which was basically in line with market expectations and fell by 12% after the exchange rate was eliminated. While improving the quality of sales, same-store sales still recorded a 6% decline after the exchange rate was removed, slightly higher than the market expectation of 5.8%. During the first quarter, the group closed its Polo Ralph Lauren flagship store on Fifth Avenue in New York.