Michael Kors to close stores after disappointing year
01/06/2017
Total revenue for the year was $4.49 billion, on which it made a net profit of $552.5 million, 34.2% down on the previous 12-month period.
This came after a disappointing end to the year. In the fourth quarter, revenue fell 11.2% to $1.06 billion, largely due to a 22.8% drop in revenue from its wholesale operations.
Michael Kors chairman and CEO, John Idol, described 2016/17 as a “challenging year” for the company and said it continued to operate in a “difficult retail environment”.
On announcing the results, Michael Kors said it would close between 100 and 125 of its full-price retail stores over the next two years in an effort to “improve the profitability of its store fleet”. The company revealed it expects this to involve on-time costs of $100-125 million, but that it will result in “annual ongoing savings” of $60 million.
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