Capri Holdings (CPRI) reports 8.6% increase in second quarter sales

US luxury goods group Capri Holdings, which owns the Michael Kors, Versace and Jimmy Choo brands, has released its results for the second quarter of the 2023 fiscal year ended October. The group reported total sales of $1.41 billion and growth of 8.6% at constant rates, compared to the same period last year.

Eva Morletto

By Eva Morletto11 novembre 2022

The Versace fashion shows are among the most followed events on Chinese social networks. (Shutterstock)

Over the past two years, the holding company has been able to rationalise and optimise its costs in order to maintain a satisfactory net profit. The company's net profit was $224 million, or $1.63 per diluted share, compared to $200 million, or $1.30 per diluted share, in the previous year.

Despite these positive numbers, executives remain cautious about the full-year outlook for 2023. John D. Idol, the company's president and CEO, said on November 9: "Looking ahead to the remainder of fiscal 2023, we are now taking a more cautious stance on our revenue outlook due to an increasingly uncertain macroeconomic environment, foreign currency headwinds and the continued impact of COVID."

The Chinese market is particularly loyal to the Capri Group's brands: e-commerce channels saw a 10% increase in business last year thanks to the popularity of Chinese customers. The Versace fashion shows during European fashion weeks are among the most followed events on Chinese social networks.

Capri holdings is now targeting $5.7 billion for the whole of 2023, whereas previous estimates were for $5.85 billion.

Goldman Sachs believes that the second quarter results are fundamental to understanding the group's business strategy for the rest of the year, which is still too unstable internationally to allow the holding company's management to risk new investments or changes in direction.

For two years, Europe has been the weakest link among the geographical sectors analysed by the company, with the Old Continent falling victim to the pandemic, the closure of many shops and the halt in tourism.

Today Wall Street has welcomed the group's performance. Analysis by brand shows that Versace's sales rose by 9.2% in the quarter to $308 million, while Jimmy Choo disappointed with a weak 3.6% growth and $142 million in sales. Colossus Michael Kors saw sales rise by 9.2% to $962 million.

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