Ralph Lauren sees margin growth but weak revenues in Q1, appoints new CFO

Luxury fashion house Ralph Lauren Corp.
(RL), while reporting higher fourth-quarter results, on Thursday
issued first-quarter outlook, expecting increased margin but weak
revenues. The company also issued fiscal 2025 forecast, and announced
higher dividend.

Separately, Ralph Lauren announced the appointment of Justin Picicci
as Chief Financial Officer, effective May 23.

In pre-market activity on the NYSE, Ralph Lauren shares were losing
around 4.9 percent to trade at $156.13.

The newly appointed CFO Picicci succeeds Jane Nielsen, who has
served as CFO and Chief Operating Officer since 2019. Nielsen will
remain the Company’s COO, continuing to lead key operational and
strategy functions through March 2025.

Picicci holds 18-year track record at Ralph Lauren, most recently
serving as Enterprise Chief Financial Officer.

Ralph Lauren also announced that its Board of Directors declared a 10
percent increase in the regular quarterly cash dividend of $0.825 per
share for a total annual dividend amount of $3.30 per share. The next
quarterly dividend will be paid on July 12, to shareholders of record
at the close of business on June 28.

Revenue growth anticipated for FY25

Looking ahead for the first quarter, the company expects operating
margin to expand approximately 60 to 80 basis points in constant
currency, and gross margin to expand around 140 to 180 basis points.

The company expects revenues to be down slightly to prior year on a
reported basis due to negative foreign currency impact, but up
slightly to last year on a constant currency basis.

For fiscal 2025, the company expects operating margin to expand
approximately 100 to 120 basis points, and gross margin to increase
about 50 to 100 basis points, both in constant currency.

Annual revenues are expected to increase low-single digits to last
year on a constant currency basis, centering on about 2 percent to 3
percent. Based on current exchange rates, foreign currency is
expected to negatively impact revenue growth by approximately 90
basis points in fiscal 2025.

In its fourth quarter, the company’s earnings increased from last
year and beat the Street estimates.

The company’s bottom line came in at $90.7 million or $1.38 per
share, compared to $32.3 million or $0.48 per share last year.

Adjusted earnings were $111.8 million or $1.71 per share for the
period, compared to last year’s $61 million or $0.90 per share.
Analysts on average had expected the company to earn $1.66 per share,
according to figures compiled by Thomson Reuters. Analysts’ estimates
typically exclude special items.

The company’s revenue for the quarter rose 1.9 percent to $1.57
billion from $1.54 billion last year.(DPA)