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Ralph Lauren Corporation (RL) has reported 37.40 percent plunge in profit for the quarter ended Dec. 31, 2016. The company has earned $82 million, or $0.98 a share in the quarter, compared with $131 million, or $1.54 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $155 million, or $1.86 a share compared with $193 million or $2.27 a share, a year ago. Revenue during the quarter dropped 11.92 percent to $1,714 million from $1,946 million in the previous year period. Gross margin for the quarter expanded 113 basis points over the previous year period to 57.35 percent. Total expenses were 92.53 percent of quarterly revenues, up from 90.29 percent for the same period last year. That has resulted in a contraction of 224 basis points in operating margin to 7.47 percent.
Operating income for the quarter was $128 million, compared with $189 million in the previous year period.
The Company and Stefan Larsson, President and Chief Executive Officer, also announced today that they mutually agreed to part ways. Stefan Larsson will stay on until May 1, 2017. A search for a new Chief Executive Officer will be conducted. The Company will continue to execute the Way Forward plan announced in June 2016, and Chief Financial Officer Jane Nielsen will lead execution of the plan until a new CEO joins the Company. A separate release provides more detail on the CEO departure.
Working capital declines
Ralph Lauren Corporation has witnessed a decline in the working capital over the last year. It stood at $1,883 million as at Dec. 31, 2016, down 15.86 percent or $355 million from $2,238 million on Dec. 26, 2015. Current ratio was at 2.64 as on Dec. 31, 2016, down from 2.84 on Dec. 26, 2015. Cash conversion cycle (CCC) has decreased to 65 days for the quarter from 148 days for the last year period. Days sales outstanding went down to 27 days for the quarter compared with 28 days for the same period last year.
Days inventory outstanding has decreased to 61 days for the quarter compared with 142 days for the previous year period. At the same time, days payable outstanding went up to 23 days for the quarter from 21 for the same period last year.
Debt comes down marginally
Ralph Lauren Corporation has recorded a decline in total debt over the last one year. It stood at $589 million as on Dec. 31, 2016, down 3.60 percent or $22 million from $611 million on Dec. 26, 2015. Total debt was 9.87 percent of total assets as on Dec. 31, 2016, compared with 9.64 percent on Dec. 26, 2015. Debt to equity ratio was almost stable at 0.16 as on Dec. 31, 2016, when compared with the last year. Interest coverage ratio improved to 32 for the quarter from 31.50 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
