Ralph Lauren posts bigger loss, revenues drop 15 percent

Ralph Lauren Corporation has reported loss per diluted share of 3.38 dollars on a reported basis and loss of 68 cents on an adjusted basis, for the fourth quarter of fiscal 2020 compared to earnings per diluted share of 39 cents on a reported basis and 1.07 dollars on an adjusted basis for the same quarter of fiscal 2019. For fiscal 2020, earnings per diluted share were 4.98 dollars on a reported basis and 6.56 dollars on an adjusted basis compared to earnings per diluted share of 5.27 dollars on a reported basis and 7.19 dollars on an adjusted basis for the full year of fiscal 2019.

“From the onset of Covid-19, our teams moved quickly around the world to protect the safety and well-being of our employees, consumers, and communities, while also taking steps to ensure our long-term financial health and bring relevant digital commerce and experiences to our consumers,” said Patrice Louvet, the company’s President & Chief Executive Officer, adding, “Reflecting on our performance prior to the crisis, our underlying progress was strong, as our AUR and overall brand elevation journey continued across every region, exceeding our expectations for both the quarter and year.”

Ralph Lauren’s Q4 revenues decline by 15 percent

In the fourth quarter, the company said, revenue declined 15 percent to 1.3 billion dollars on a reported basis and was down 14 percent, reflecting adverse impacts related to Covid-19 and Hong Kong protest business disruptions.

North America revenue in the fourth quarter decreased 11 percent to 629 million dollars, including adverse impacts related to Covid-19 business disruptions across distribution channels. North America wholesale revenue was down 12 percent to last year and in retail, comparable store sales in North America were down 13 percent, including a 15 percent decline in brick and mortar stores and a 7 percent decrease in digital commerce.

Europe revenue decreased 19 percent to 353 million dollars on a reported basis and decreased 16 percent to last year in constant currency. In retail, comparable store sales in Europe were down 16 percent on a constant currency basis, driven by an 18 percent decrease in brick and mortar stores and a 2 percent decrease in digital commerce, while Europe wholesale revenue decreased 21 percent on a reported basis and decreased 18 percent in constant currency.

Revenues in Asia decreased 22 percent to 214 million dollars on a reported basis and decreased 21 percent in constant currency, including adverse impacts related to Covid-19 and Hong Kong protest business disruptions. Comparable store sales in Asia decreased 23 percent in constant currency, with a 15 percent increase in digital commerce operations more than offset by brick and mortar declines during the period due to Covid-19-related store closures.

Gross profit for the fourth quarter was 594 million dollars and gross margin was 46.7 percent. On an adjusted basis, gross margin was 59.1 percent compared to 60.1 percent in the prior year period. On a reported basis, net loss was 249 million dollars or loss of 3.38 dollars per diluted share. On an adjusted basis, net loss was 50 million dollars or loss of 68 cents per diluted share.

Ralph Lauren turnover drops 2 percent in fiscal 2020

For fiscal 2020, revenue decreased 2 percent to 6.2 billion dollars on a reported basis and decreased 1 percent in constant currency including adverse impacts related to Covid-19 and Hong Kong protest business disruptions.

For fiscal 2020, North America revenue decreased 2 percent on a reported basis to 3.1 billion dollars, while sales in Europe decreased 3 percent to 1.6 billion dollars on a reported basis. In constant currency, revenue increased 1 percent. For fiscal 2020, Asia revenue decreased 2 percent to 1 billion dollars on a reported basis, while in constant currency, revenue decreased 1 percent.

Gross profit for the fiscal was 3.7 billion dollars on a reported basis, and on an adjusted basis, gross margin was 61.9 percent, 20 basis points higher than the prior year.

In fiscal 2020, on a reported basis, net income was 384 million dollars or 4.98 dollars per diluted share and on an adjusted basis, net income was 506 million dollars or 6.56 dollars per diluted share.

“We expect our financial results for both periods to be significantly negatively impacted by the pandemic. Though the timing and path of recovery in each market presents many uncertainties, we have developed scenarios through which we plan to safely return our businesses to growth and value creation,” the company said in a statement.

Picture:Ralph Lauren newsroom