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Ralph Lauren 8-K Report, Financial Results (Nov 7, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed November 7, 2024
Period End
November 7, 2024
Security
RL
In the record · 2016–202610-K1110-Q328-K93

RL filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 93 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Aug ’18Aug ’18
  2. Restructuring8-K · Sep ’20Sep ’20
  3. Leadership change8-K · Nov ’22Nov ’22
  4. Leadership change8-K · Sep ’26Sep ’26

01—Abstract

Summary

Summary of the 8-K filed November 7, 2024. Cited figures are marked; the original filing is the authoritative source.

Ralph Lauren Corporation reported results for the fiscal second quarter ended September 28, 2024 (Fiscal 2025), in a press release furnished as Exhibit 99.1 under Item 2.02.

Net revenues rose to $1.73 billiona, up 6% on both a reported and constant currency basis, with growth led by Asia (up 9% reported, 10% constant currency) and Europe (up 7% reported, 6% constant currency). North America revenue increased 3% to $739 million, with retail comparable store sales up 6%. Reported diluted EPS was $2.31, compared with $2.19 a year earlier, and adjusted diluted EPS, excluding restructuring-related and other net charges, was $2.54 versus $2.10.

Reported operating income was $178.9 millionb, and adjusted operating margin was 11.4%. The company raised its full-year Fiscal 2025 outlook. It now expects constant currency revenue growth of approximately 3% to 4% and operating margin expansion of approximately 110 to 130 basis points in constant currency.

For the third quarter, it expects constant currency revenue growth of approximately 3% to 4% and operating margin expansion of approximately 100 to 140 basis points in constant currency. The full-year tax rate is now expected to be approximately 22% to 23%, and capital expenditures are expected to be $250 million to $300 millionc. Balance sheet and cash returns remained solid.

Cash and short-term investments totaled $1.7 billiond against total debt of $1.1 billion, and the company repurchased approximately $100 million of Class A Common Stock in the quarter. Inventory was $1.1 billion, down 6% year over year, primarily reflecting strategic reductions in North America. Shareholders received approximately $375 million through dividends and share repurchases fiscal year-to-date.

02—Key points

Key Highlights

  1. Second-quarter revenue of $1.73 billion rose 6% on both a reported and constant currency basis, ahead of the company's expectations.
  2. Global direct-to-consumer comparable store sales grew 10%, with positive retail comps across all regions.
  3. Adjusted diluted EPS was $2.54, up from $2.10 a year earlier; reported diluted EPS was $2.31 versus $2.19.
  4. Adjusted gross margin was 67.0%, 160 basis points above the prior year, driven by mix shifts, lower cotton costs and AUR growth.
  5. Full-year Fiscal 2025 constant currency revenue growth outlook was raised to approximately 3% to 4%, and operating margin expansion outlook to approximately 110 to 130 basis points.
  6. Cash and short-term investments were $1.7 billion against $1.1 billion of total debt at quarter end.
  7. Inventory of $1.1 billion was down 6% year over year, primarily from strategic reductions in North America.

03—Questions

Frequently Asked Questions

  1. How did Ralph Lauren perform by region in the second quarter of Fiscal 2025?

    Asia revenue rose 9% on a reported basis to $380 million, and Europe revenue rose 7% to $566 million. North America revenue increased 3% to $739 million, with brick and mortar comparable store sales up 9% offsetting a 2% decline in digital commerce comparable sales.

  2. What changed in the company's full-year Fiscal 2025 outlook?

    The company now expects constant currency revenue growth of approximately 3% to 4% and operating margin expansion of approximately 110 to 130 basis points in constant currency. Foreign currency is expected to reduce revenue by approximately 40 to 60 basis points, and the full-year tax rate is expected to be approximately 22% to 23%.

  3. What was the difference between reported and adjusted results this quarter?

    Adjustments excluded $18.4 million of restructuring and other charges, net, from operating income. Reported operating income was $178.9 million and adjusted operating income was $197.3 million, and reported diluted EPS of $2.31 compared with adjusted diluted EPS of $2.54.

  4. What is the company's outlook for the third quarter of Fiscal 2025?

    The company expects constant currency revenue to grow approximately 3% to 4% and operating margin to expand approximately 100 to 140 basis points in constant currency, driven by gross margin expansion. Foreign currency is expected to benefit revenue growth by approximately 10 to 50 basis points.

  5. How much did the company return to shareholders and how strong is its balance sheet?

    The company returned approximately $375 million to shareholders through dividends and Class A common stock repurchases fiscal year-to-date, and repurchased approximately $100 million of stock in the second quarter. It ended the quarter with $1.7 billion in cash and short-term investments and $1.1 billion in total debt.

04—Continue

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