Ralph Lauren Earnings: Beats the Street on Profit Rise

S&P 500 (NYSE:SPY) component Ralph Lauren Corporation (NYSE:RL) reported net income above Wall Street’s expectations for the fourth quarter. Polo Ralph Lauren designs and sells premium lifestyle products, including apparel, accessories, fragrances and home furnishings.

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Ralph Lauren Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for the textile-apparel rose to $94.4 million (99 cents per share) vs. $73.2 million (74 cents per share) in the same quarter a year earlier. This marks a rise of 29% from the year-earlier quarter.

Revenue: Rose 13.7% to $1.62 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Ralph Lauren Corporation beat the mean analyst estimate of 85 cents per share. Analysts were expecting revenue of $1.6 billion.

Quoting Management: “Fiscal 2012 was another year of spectacular growth for our Company,” said Ralph Lauren, Chairman and Chief Executive Officer. “We made significant progress with our international expansion efforts and we launched exciting new products during the year. I am thrilled with the momentum we are gaining with our handbags worldwide and we will continue to invest in innovation and distribution to support this high growth merchandise category. We are in the midst of transforming our presence in Greater China, a region that we believe will become an important driver of growth for us over the long term, and have some magnificent new stores planned for the next several years. As proud as I am of what we’ve accomplished, I am even more excited about the many compelling opportunities that are still ahead for us,” Mr. Lauren added.

Key Stats:

The company has now seen its net income rise for three quarters in a row. In the third quarter, net income rose 0.4% and in the second quarter, the figure rose 13.8%.

The company has now surpassed analyst estimates for four quarters in a row. It beat the mark by 11 cents in the third quarter, by 22 cents in the second quarter, and by 45 cents in the first quarter.

Revenue has increased for four consecutive quarters. Revenue increased 16.6% to $1.81 billion in the third quarter. The figure rose 24.3% in the second quarter from the year earlier and climbed 32.4% in the first quarter from the year-ago quarter.

Gross margins expanded last quarter, rising 0.3 percentage point to 57.1% from the year-earlier quarter. This snaps a streak of two consecutive quarters of shrinking margins.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the first quarter of the next fiscal year is $2.13 per share, down from $2.14 ninety days ago. For the fiscal year, the average estimate has moved up from $7.04 a share to $7.09 over the last ninety days.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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