=Michael Kors (KORS) reported earnings on Tue 8 Aug 2017 (b/o)

Michael Kors beats by $0.18, beats on revs; guides Q2 above consensus; raises FY18 above consensus(37.23 )

• Reports Q1 (Jun) earnings of $0.80 per share, $0.18 better than the Capital IQ Consensus of $0.62; revenues fell 3.6% year/year to $952.4 mln vs the $919.18 mln Capital IQ Consensus. Retail net sales increased 10.1% to $619.9 million driven in large part by 67 net new store openings since the end of the first quarter of fiscal 2017 and the impact of the acquisition of the Greater China license. Comparable sales decreased 5.9% vs. high single digit decrease guidance. On a constant currency basis, retail net sales increased 11.6%, and comparable sales decreased 4.9%. Wholesale net sales decreased 23.0% to $303.6 million and on a constant currency basis, wholesale net sales decreased 22.7%. Licensing revenue decreased 5.6% to $28.9 million.
• Co issues upside guidance for Q2, sees EPS of $0.80-0.84 vs. $0.79 Capital IQ Consensus Estimate; sees Q2 revs of $1.035-1.055 mln vs. $1.01 bln Capital IQ Consensus Estimate.
• Co issues upside guidance for FY18, raises EPS to $3.62-3.72 from $3.57-3.67 vs. $3.54 Capital IQ Consensus; raises FY18 revs to $4.275 bln from $4.25 bln vs. $4.19 bln Capital IQ Consensus Estimate; comps down mid-single digits, operating margin 16%
• Outlook does not include Jimmy Choo... Based on the Company's internal forecasts for Jimmy Choo and assuming a close early in the Company's third fiscal quarter, incremental revenue is expected to be ~$275 million for the second half of fiscal 2018. For fiscal 2019, the Company expects incremental revenues of $570 million to $580 million1. The Company expects this acquisition to be immediately accretive on a cash basis. The Company believes the acquisition will be dilutive to EPS in the low single digit percentage range in both Fiscal 2018 and 2019 and accretive in the low single digits in Fiscal 2020, excluding one-time transaction and transition costs related to the acquisition2.