Ralph Lauren Reports Second Quarter Fiscal 2017 Results and Maintains Its Fiscal 2017 Outlook
"We are changing with the consumer, as we demonstrated in September with our first-ever ‘see-now-buy-now' runway show at our flagship store on
"Our team is intensely focused on driving the execution of the Way Forward plan," said
- drove our quality of sales up by moderating discount levels;
- lowered our inventory levels by 15%;
- reduced our SKUs for Fall 2016 by 10%;
- created our Ralph Lauren Icons marketing campaign;
- launched ‘see-now-buy-now' fashion show with more than twice the global media impressions compared to the previous show;
- announced Denim & Supply closure to focus on our core;
- optimized our sales fleet by closing 7 under-performing stores; and
- platformed the vast majority of key fabrics for core styles."
Second Quarter Fiscal 2017 Income Statement Review
Net Revenues. For the second quarter of Fiscal 2017, net revenues of
- Wholesale Revenue. In the second quarter of Fiscal 2017, wholesale segment revenue decreased 10% on both a reported and constant currency basis to
$831 million , driven by a decline inNorth America , as shipments were strategically reduced as part of the Way Forward plan. This was partially offset by an increase inEurope . - Retail Revenue. Retail segment revenue decreased 5% on a reported basis to
$942 million in the second quarter, and was down 6% on a constant currency basis, both driven by a comparable store sales decline. Consolidated comparable store sales decreased 8% on a reported basis and 9% in constant currency in the second quarter with traffic declines only partially offset by moderated markdown levels. - Licensing Revenue. Licensing segment revenue of
$48 million in the second quarter increased 2% on a reported basis and was approximately flat with the prior year period on a constant currency basis.
Gross Profit. Gross profit for the second quarter of Fiscal 2017 was
Operating Expenses. Operating expenses in the second quarter of Fiscal 2017 were
Operating Income. Operating income in the second quarter of Fiscal 2017 was
- Wholesale Operating Income. Wholesale operating income in the second quarter of Fiscal 2017 was
$203 million and wholesale operating margin was 24.5% on a reported basis, including$15 million in restructuring and other related charges. On an adjusted basis, wholesale operating income in the second quarter was$218 million and wholesale operating margin was 26.4%, down 40 basis points compared to last year. - Retail Operating Income. Retail operating income in the second quarter of Fiscal 2017 was
$19 million and retail operating margin was 2.0% on a reported basis, including$93 million in restructuring and other related charges. On an adjusted basis, retail operating income was$112 million and retail operating margin was 11.8%, down 100 basis points compared to last year. - Licensing Operating Income. Licensing operating income of
$44 million in the second quarter of Fiscal 2017 increased 5% compared to the prior year period on a reported basis.
Net Income and Diluted EPS. On a reported basis, net income in the second quarter of Fiscal 2017 was
The Company had an effective tax rate of approximately 38% in the second quarter of Fiscal 2017 on a reported basis. On an adjusted basis, the effective tax rate was approximately 29%, excluding restructuring and other related charges, which compared to an adjusted effective tax rate of 29% in the prior year period.
Full Year Fiscal 2017 and Third Quarter Outlook
For Fiscal 2017, the Company is maintaining its guidance. Consolidated net revenue is expected to decrease at a low-double digit rate consistent with the Way Forward plan. Key elements include a proactive pullback in inventory receipts, store closures, pricing harmonization and quality of sales initiatives. Based on current exchange rates, foreign currency is expected to have minimal impact on revenue growth in Fiscal 2017.
The Company continues to expect operating margin for Fiscal 2017 to be approximately 10%, as cost savings are expected to be offset by growth in new store expenses, unfavorable foreign currency impacts in gross margin, infrastructure investments and fixed expense deleverage. The Fiscal 2017 tax rate is estimated to be approximately 29%.
In the third quarter of Fiscal 2017, the Company expects consolidated net revenues to be down low-double digits to down low-teens on a reported basis, with continued execution of quality of sales initiatives, inventory receipt reductions, and fleet optimization consistent with the Way Forward plan. Based on current exchange rates, foreign currency is expected to have minimal impact on revenue growth in the third quarter, but will pressure gross margin by at least 120 basis points.
Operating margin for the third quarter of Fiscal 2017 is expected to be down approximately 200 to 225 basis points compared to the prior year period, as a shift in timing of planned operating expenses negatively impacts the third quarter and savings initiatives from the Way Forward plan are more fully realized in the fourth quarter. The third quarter tax rate is estimated at 29%.
The full year Fiscal 2017 and third quarter guidance excludes restructuring and other related charges expected to be recorded in connection with the Company's Way Forward plan.
The Company is not able to provide a full reconciliation of the non-GAAP financial measures to GAAP because certain material items that impact these measures, such as the timing and exact amount of charges related to our Way Forward plan, have not yet occurred or are out of the Company's control. Accordingly, a reconciliation of our non-GAAP financial measure guidance to the corresponding GAAP measures is not available without unreasonable effort. The Company has identified the estimated impact of the items excluded from its Fiscal 2017 guidance.
This Fiscal 2017 non-GAAP guidance excludes estimated pretax charges related to our Way Forward plan, comprised of restructuring-related charges of about
Fiscal 2017 Way Forward Cost Savings Plan
The Company expects its Fiscal 2017 restructuring activities to result in approximately
The Company expects to incur restructuring charges of about
Conference Call
As previously announced, the Company will host a conference call and live online webcast today,
An online archive of the broadcast will be available by accessing the Company's investor relations website at http://investor.ralphlauren.com. A telephone replay of the call will be available from
ABOUT
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release and oral statements made from time to time by representatives of the Company contain certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include the statements under " Full Year Fiscal 2017 and Third Quarter Outlook," and "Fiscal 2017 Way Forward Cost Savings Plan" and statements regarding, among other things, our current expectations about the Company's future results and financial condition, revenues, store openings and closings, employee reductions, margins, expenses and earnings and are indicated by words or phrases such as "anticipate," "estimate," "expect," "project," "we believe" and similar words or phrases. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from the future results, performance or achievements expressed in or implied by such forward-looking statements. Forward-looking statements are based largely on the Company's expectations and judgments and are subject to a number of risks and uncertainties, many of which are unforeseeable and beyond our control. The factors that could cause actual results to materially differ include, among others: the loss of key personnel, including Mr. Ralph Lauren, or other changes in our executive and senior management team or to our operating structure, and our ability to effectively transfer knowledge during periods of transition; our ability to successfully implement our Way Forward Plan and long-term growth strategy, which entails evolving our operating model to enable sustainable, profitable sales growth by significantly reducing supply chain lead times, employing best-in class sourcing, and capitalizing on our repositioning initiatives in certain brands, regions, and merchandise categories; our ability to achieve anticipated operating enhancements and/or cost reductions from our restructuring plans, which could include the potential sale, discontinuance, or consolidation of certain of our brands; the impact to our business resulting from potential costs and obligations related to the early termination of our long-term, non-cancellable leases; our efforts to improve the efficiency of our distribution system and to continue to enhance, upgrade, and/or transition our global information technology systems and our global e-commerce platform; our ability to secure our facilities and systems and those of our third-party service providers from, among other things, cybersecurity breaches, acts of vandalism, computer viruses, or similar Internet or email events; our exposure to currency exchange rate fluctuations from both a transactional and translational perspective; the impact to our business resulting from increases in the costs of raw materials, transportation, and labor; our ability to continue to maintain our brand image and reputation and protect our trademarks; the impact to our business resulting from the
RALPH LAUREN CORPORATION | ||||||||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||||||||
Prepared in accordance with U.S. Generally Accepted Accounting Principles | ||||||||||||||||
(in millions) | ||||||||||||||||
(Unaudited) | ||||||||||||||||
October 1, | April 2, | September 26, | ||||||||||||||
2016 | 2016 | 2015 | ||||||||||||||
ASSETS | ||||||||||||||||
Current assets: | ||||||||||||||||
Cash and cash equivalents | $ | 434 | $ | 456 | $ | 380 | ||||||||||
Short-term investments | 531 | 629 | 746 | |||||||||||||
Accounts receivable, net of allowances | 490 | 517 | 594 | |||||||||||||
Inventories | 1,173 | 1,125 | 1,380 | |||||||||||||
Income tax receivable | 59 | 58 | 65 | |||||||||||||
Deferred tax assets | - | - | 147 | |||||||||||||
Prepaid expenses and other current assets | 289 | 268 | 268 | |||||||||||||
Total current assets | 2,976 | 3,053 | 3,580 | |||||||||||||
Property and equipment, net | 1,564 | 1,583 | 1,519 | |||||||||||||
Deferred tax assets | 118 | 119 | 43 | |||||||||||||
Goodwill | 936 | 918 | 906 | |||||||||||||
Intangible assets, net | 235 | 244 | 255 | |||||||||||||
Other non-current assets (a) | 238 | 296 | 140 | |||||||||||||
Total assets | $ | 6,067 | $ | 6,213 | $ | 6,443 | ||||||||||
LIABILITIES AND EQUITY | ||||||||||||||||
Current liabilities: | ||||||||||||||||
Short-term debt | $ | 95 | $ | 116 | $ | 130 | ||||||||||
Accounts payable | 159 | 151 | 206 | |||||||||||||
Income tax payable | 20 | 33 | 16 | |||||||||||||
Accrued expenses and other current liabilities | 943 | 898 | 926 | |||||||||||||
Total current liabilities | 1,217 | 1,198 | 1,278 | |||||||||||||
Long-term debt | 597 | 597 | 597 | |||||||||||||
Non-current liability for unrecognized tax benefits | 74 | 81 | 90 | |||||||||||||
Other non-current liabilities | 581 | 593 | 667 | |||||||||||||
Total liabilities | 2,469 | 2,469 | 2,632 | |||||||||||||
Equity: | ||||||||||||||||
Common stock | 1 | 1 | 1 | |||||||||||||
Additional paid-in-capital | 2,284 | 2,258 | 2,199 | |||||||||||||
Retained earnings | 5,956 | 6,015 | 5,926 | |||||||||||||
Treasury stock, Class A, at cost | (4,463 | ) | (4,349 | ) | (4,148 | ) | ||||||||||
Accumulated other comprehensive loss | (180 | ) | (181 | ) | (167 | ) | ||||||||||
Total equity | 3,598 | 3,744 | 3,811 | |||||||||||||
Total liabilities and equity | $ | 6,067 | $ | 6,213 | $ | 6,443 | ||||||||||
Net Cash (incl. LT Investments) | 395 | 559 | 407 | |||||||||||||
Cash & Investments (ST & LT) | 1,087 | 1,272 | 1,134 | |||||||||||||
Net Cash (excl. LT Investments) | 273 | 372 | 399 | |||||||||||||
Cash & ST Investments | 965 | 1,085 | 1,126 | |||||||||||||
(a) Includes non-current investments of: | $ | 122 | $ | 187 | $ | 8 | ||||||||||
RALPH LAUREN CORPORATION | |||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||
Prepared in accordance with U.S. Generally Accepted Accounting Principles | |||||||||||
(in millions, except per share data) | |||||||||||
(Unaudited) | |||||||||||
Three Months Ended | |||||||||||
October 1, | September 26, | ||||||||||
2016 | 2015 | ||||||||||
Wholesale net sales | $ | 831 | $ | 927 | |||||||
Retail net sales | 942 | 996 | |||||||||
Net sales | 1,773 | 1,923 | |||||||||
Licensing revenue | 48 | 47 | |||||||||
Net revenues | 1,821 | 1,970 | |||||||||
Cost of goods sold(a) | (867 | ) | (857 | ) | |||||||
Gross profit | 954 | 1,113 | |||||||||
Selling, general, and administrative expenses(a) | (803 | ) | (839 | ) | |||||||
Amortization of intangible assets | (6 | ) | (6 | ) | |||||||
Impairment of assets | (27 | ) | (7 | ) | |||||||
Restructuring and other charges | (42 | ) | (31 | ) | |||||||
Total other operating expenses, net | (878 | ) | (883 | ) | |||||||
Operating income | 76 | 230 | |||||||||
Foreign currency gains (losses) | 1 | (5 | ) | ||||||||
Interest expense | (4 | ) | (4 | ) | |||||||
Interest and other income, net | 2 | 1 | |||||||||
Equity in losses of equity-method investees | (2 | ) | (3 | ) | |||||||
Income before income taxes | 73 | 219 | |||||||||
Provision for income taxes | (28 | ) | (59 | ) | |||||||
Net income | $ | 45 | $ | 160 | |||||||
Net income per share - Basic | $ | 0.55 | $ | 1.87 | |||||||
Net income per share - Diluted | $ | 0.55 | $ | 1.86 | |||||||
Weighted average shares outstanding - Basic | 82.7 | 85.6 | |||||||||
Weighted average shares outstanding - Diluted | 83.2 | 86.0 | |||||||||
Dividends declared per share | $ | 0.50 | $ | 0.50 | |||||||
(a) Includes total depreciation expense of: | $ | (70 | ) | $ | (71 | ) | |||||
RALPH LAUREN CORPORATION | |||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||
Prepared in accordance with U.S. Generally Accepted Accounting Principles | |||||||||||
(in millions, except per share data) | |||||||||||
(Unaudited) | |||||||||||
Six Months Ended | |||||||||||
October 1, | September 26, | ||||||||||
2016 | 2015 | ||||||||||
Wholesale net sales | $ | 1,438 | $ | 1,569 | |||||||
Retail net sales | 1,849 | 1,931 | |||||||||
Net sales | 3,287 | 3,500 | |||||||||
Licensing revenue | 86 | 88 | |||||||||
Net revenues | 3,373 | 3,588 | |||||||||
Cost of goods sold(a) | (1,524 | ) | (1,509 | ) | |||||||
Gross profit | 1,849 | 2,079 | |||||||||
Selling, general, and administrative expenses(a) | (1,618 | ) | (1,661 | ) | |||||||
Amortization of intangible assets | (12 | ) | (12 | ) | |||||||
Impairment of assets | (46 | ) | (15 | ) | |||||||
Restructuring and other charges | (128 | ) | (65 | ) | |||||||
Total other operating expenses, net | (1,804 | ) | (1,753 | ) | |||||||
Operating income | 45 | 326 | |||||||||
Foreign currency gains (losses) | 3 | (6 | ) | ||||||||
Interest expense | (7 | ) | (8 | ) | |||||||
Interest and other income, net | 3 | 3 | |||||||||
Equity in losses of equity-method investees | (4 | ) | (6 | ) | |||||||
Income before income taxes | 40 | 309 | |||||||||
Provision for income taxes | (17 | ) | (85 | ) | |||||||
Net income | $ | 23 | $ | 224 | |||||||
Net income per share - Basic | $ | 0.28 | $ | 2.60 | |||||||
Net income per share - Diluted | $ | 0.28 | $ | 2.58 | |||||||
Weighted average shares outstanding - Basic | 83.0 | 86.1 | |||||||||
Weighted average shares outstanding - Diluted | 83.7 | 86.8 | |||||||||
Dividends declared per share | $ | 1.00 | $ | 1.00 | |||||||
(a) Includes total depreciation expense of: | $ | (142 | ) | $ | (139 | ) | |||||
RALPH LAUREN CORPORATION | |||||||||||||||||||||
OTHER INFORMATION | |||||||||||||||||||||
(in millions) | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
SEGMENT INFORMATION | |||||||||||||||||||||
Net revenues and operating income for the periods ended October 1, 2016 and September 26, 2015 for each segment were as follows: | |||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||
October 1, | September 26, | October 1, | September 26, | ||||||||||||||||||
2016 | 2015 | 2016 | 2015 | ||||||||||||||||||
Net revenues: | |||||||||||||||||||||
Wholesale | $ | 831 | $ | 927 | $ | 1,438 | $ | 1,569 | |||||||||||||
Retail | 942 | 996 | 1,849 | 1,931 | |||||||||||||||||
Licensing | 48 | 47 | 86 | 88 | |||||||||||||||||
Total net revenues | $ | 1,821 | $ | 1,970 | $ | 3,373 | $ | 3,588 | |||||||||||||
Operating income: | |||||||||||||||||||||
Wholesale | $ | 203 | $ | 247 | $ | 336 | $ | 384 | |||||||||||||
Retail | 19 | 123 | 82 | 233 | |||||||||||||||||
Licensing | 44 | 42 | 78 | 78 | |||||||||||||||||
266 | 412 | 496 | 695 | ||||||||||||||||||
Unallocated corporate expenses | (148 | ) | (151 | ) | (323 | ) | (304 | ) | |||||||||||||
Unallocated restructuring and other charges | (42 | ) | (31 | ) | (128 | ) | (65 | ) | |||||||||||||
Total operating income | $ | 76 | $ | 230 | $ | 45 | $ | 326 | |||||||||||||
RALPH LAUREN CORPORATION | |||||||||||||||||||
Constant Currency Financial Measures | |||||||||||||||||||
(in millions) | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
Same - Store Sales Data | |||||||||||||||||||
Three Months Ended October 1, 2016 % Change | Six Months Ended October 1, 2016 % Change | ||||||||||||||||||
As Reported | Constant Currency | As Reported | Constant Currency | ||||||||||||||||
Total Ralph Lauren | (8 | %) | (9 | %) | (7 | %) | (8 | %) | |||||||||||
Operating Segment Data | |||||||||||||||||||
Three Months Ended | % Change | ||||||||||||||||||
October 1, 2016 | September 26, 2015 | As Reported | Constant Currency | ||||||||||||||||
Wholesale net sales | $ | 831 | $ | 927 | (10.4 | %) | (10.1 | %) | |||||||||||
Retail net sales | 942 | 996 | (5.4 | %) | (6.4 | %) | |||||||||||||
Net sales | 1,773 | 1,923 | (7.8 | %) | (8.2 | %) | |||||||||||||
Licensing revenue | 48 | 47 | 1.6 | % | (0.2 | %) | |||||||||||||
Net revenues | $ | 1,821 | $ | 1,970 | (7.6 | %) | (8.0 | %) | |||||||||||
Six Months Ended | % Change | ||||||||||||||||||
October 1, 2016 | September 26, 2015 | As Reported | Constant Currency | ||||||||||||||||
Wholesale net sales | $ | 1,438 | $ | 1,569 | (8.3 | %) | (8.1 | %) | |||||||||||
Retail net sales | 1,849 | 1,931 | (4.2 | %) | (4.9 | %) | |||||||||||||
Net sales | 3,287 | 3,500 | (6.1 | %) | (6.3 | %) | |||||||||||||
Licensing revenue | 86 | 88 | (3.0 | %) | (4.1 | %) | |||||||||||||
Net revenues | $ | 3,373 | $ | 3,588 | (6.0 | %) | (6.3 | %) | |||||||||||
RALPH LAUREN CORPORATION | |||||||
Global Retail Store Network | |||||||
As of | As of | ||||||
October 1, | September 26, | ||||||
2016 | 2015 | ||||||
Global Directly Operated Stores and Concessions | |||||||
Ralph Lauren Stores | 128 | 144 | |||||
Polo Factory Stores | 275 | 268 | |||||
Club Monaco Stores | 82 | 68 | |||||
Total Directly Operated Stores | 485 | 480 | |||||
Concessions | 620 | 576 | |||||
Global Licensed Stores and Concessions | |||||||
Ralph Lauren Licensed Stores | 102 | 81 | |||||
Club Monaco Licensed Stores | 59 | 56 | |||||
Total Licensed Stores | 161 | 137 | |||||
Licensed Concessions | 97 | 100 | |||||
RALPH LAUREN CORPORATION | |||||||||||||||||
Reconciliation of Certain Non-U.S. GAAP Financial Measures | |||||||||||||||||
(in millions, except per share data) | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Three Months Ended | |||||||||||||||||
October 1, 2016 | |||||||||||||||||
As Reported | Total Adjustments (a) | As Adjusted | |||||||||||||||
Net revenues | $ | 1,821 | $ | - | $ | 1,821 | |||||||||||
Gross profit | 954 | 81 | 1,035 | ||||||||||||||
Gross profit margin | 52.4 | % | 56.9 | % | |||||||||||||
Total other operating expenses, net | (878 | ) | 69 | (809 | ) | ||||||||||||
Operating expense margin | 48.2 | % | 44.5 | % | |||||||||||||
Operating income | 76 | 150 | 226 | ||||||||||||||
Operating margin | 4.2 | % | 12.4 | % | |||||||||||||
Income before income taxes | 73 | 150 | 223 | ||||||||||||||
Provision for income taxes | (28 | ) | (37 | ) | (65 | ) | |||||||||||
Effective tax rate | 38.0 | % | 29.0 | % | |||||||||||||
Net income | $ | 45 | $ | 113 | $ | 158 | |||||||||||
Net income per diluted share | $ | 0.55 | $ | 1.90 | |||||||||||||
Weighted average shares outstanding - Basic | 82.7 | 82.7 | |||||||||||||||
Weighted average shares outstanding - Diluted | 83.2 | 83.2 | |||||||||||||||
SEGMENT INFORMATION - | |||||||||||||||||
OPERATING INCOME: | |||||||||||||||||
Wholesale | $ | 203 | $ | 15 | $ | 218 | |||||||||||
Operating margin | 24.5 | % | 26.4 | % | |||||||||||||
Retail | 19 | 93 | 112 | ||||||||||||||
Operating margin | 2.0 | % | 11.8 | % | |||||||||||||
Licensing | 44 | - | 44 | ||||||||||||||
Operating margin | 92.3 | % | 92.3 | % | |||||||||||||
Unallocated corporate expenses and restructuring and other charges, net | (190 | ) | 42 | (148 | ) | ||||||||||||
Total operating income | $ | 76 | $ | 150 | $ | 226 | |||||||||||
Six Months Ended | |||||||||||||||||
October 1, 2016 | |||||||||||||||||
As Reported | Total Adjustments (a) | As Adjusted | |||||||||||||||
Net revenues | $ | 3,373 | $ | - | $ | 3,373 | |||||||||||
Gross profit | 1,849 | 135 | 1,984 | ||||||||||||||
Gross profit margin | 54.8 | % | 58.8 | % | |||||||||||||
Total other operating expenses, net | (1,804 | ) | 174 | (1,630 | ) | ||||||||||||
Operating expense margin | 53.5 | % | 48.3 | % | |||||||||||||
Operating income | 45 | 309 | 354 | ||||||||||||||
Operating margin | 1.3 | % | 10.5 | % | |||||||||||||
Income before income taxes | 40 | 309 | 349 | ||||||||||||||
Provision for income taxes | (17 | ) | (84 | ) | (101 | ) | |||||||||||
Effective tax rate | 42.2 | % | 29.0 | % | |||||||||||||
Net income | $ | 23 | $ | 225 | $ | 248 | |||||||||||
Net income per diluted share | $ | 0.28 | $ | 2.96 | |||||||||||||
Weighted average shares outstanding - Basic | 83.0 | 83.0 | |||||||||||||||
Weighted average shares outstanding - Diluted | 83.7 | 83.7 | |||||||||||||||
SEGMENT INFORMATION - | |||||||||||||||||
OPERATING INCOME: | |||||||||||||||||
Wholesale | $ | 336 | $ | 26 | $ | 362 | |||||||||||
Operating margin | 23.4 | % | 25.2 | % | |||||||||||||
Retail | 82 | 155 | 237 | ||||||||||||||
Operating margin | 4.4 | % | 12.8 | % | |||||||||||||
Licensing | 78 | - | 78 | ||||||||||||||
Operating margin | 91.1 | % | 91.1 | % | |||||||||||||
Unallocated corporate expenses and restructuring and other charges, net | (451 | ) | 128 | (323 | ) | ||||||||||||
Total operating income | $ | 45 | $ | 309 | $ | 354 |
(a) | Adjustments include restructuring charges, asset impairment charges, and inventory-related charges recorded in connection with our restructuring plans. Inventory-related charges are recorded within cost of goods sold in the unaudited interim consolidated statements of operations. |
SUPPLEMENTAL FINANCIAL INFORMATION
Since
Additionally, this earnings release includes certain non-U.S. GAAP financial measures relating to charges recorded in connection with the Company's restructuring plans. Included in this earnings release is a reconciliation between the non-U.S. GAAP financial measures and the most directly comparable U.S. GAAP measures before and after these charges. The related tax effects were calculated using the respective statutory tax rates for each applicable jurisdiction. The Company uses non-U.S. GAAP financial measures, among other things, to evaluate its operating performance and in order to represent the manner in which the Company conducts and views its business. The Company believes that excluding items that are not comparable from period to period helps investors and others compare operating performance between two periods. The Company's Fiscal 2017 full year and third quarter guidance excludes restructuring and other related charges expected to be recorded in connection with the Company's Way Forward Plan. While the Company considers the non-U.S. GAAP measures useful in analyzing its results, they are not intended to replace, nor act as a substitute for, any presentation included in the consolidated financial statements prepared in conformity with U.S. GAAP and may be different from non-U.S. GAAP measures reported by other companies.
View source version on businesswire.com: http://www.businesswire.com/news/home/20161110005718/en/
Source:
Ralph Lauren Corporation
Investor Relations:
Evren Kopelman, 212-813-7862
Or
Corporate Communications:
Ryan Lally, 212-318-7116