Polo Ralph Lauren Reports Results For Fiscal 1999
- Net Revenues in Year Rose 17% to $1.7 Billion -
- Net Income, Before Charges, for the Fourth Quarter was $27.3 Million on Net Revenues of $445.7 Million -
NEW YORK, May 25 /PRNewswire/ -- Polo Ralph Lauren Corporation (NYSE: RL) today reported record financial results before charges for its fourth quarter and fiscal year 1999, the period ended April 3, 1999.
Fourth Quarter and Full Year Results
Net revenues were $445.7 million for the fourth quarter of fiscal 1999, compared to $359.2 million in the fourth quarter of last year.
Income from operations, before the previously announced restructuring charges, interest and taxes, for the fourth quarter of fiscal 1999 was $47.7 million compared with $45.9 million in the fourth quarter of fiscal 1998. Net income, before the restructuring charges of $58.6 million (before taxes), was $27.3 million, or $0.27 per share for the fourth quarter of fiscal 1999, compared to $28.7 million or $0.29 per share in the fourth quarter of last year. Including the restructuring charges, the Company reported a net loss of $7.4 million or $0.07 per share, for the fourth quarter of fiscal 1999.
Net revenues for the 1999 fiscal year increased to $1.73 billion from $1.48 billion in fiscal year 1998. For fiscal year 1999, income from operations before restructuring charges, interest and taxes, was $214.1 million compared to $199.8 million for fiscal 1998. Net income, before restructuring charges, rose to $125.2 million or $1.25 per share compared with net income of $120.1 million or $1.20 per share last year. Net income, including the restructuring charges, was $90.6 million or $0.91 per share, in fiscal 1999.
The fiscal 1998 results include pro forma adjustments related to the initial public offering completed in June 1997. All per share figures are based on approximately 100 million diluted shares outstanding.
"Although we established new records in revenues, operating income and earnings per share before restructuring charges in fiscal 1999, our performance did not measure up to the standards we have set for ourselves. We are confident, however, that with the restructuring we have implemented, we will achieve higher operating margins, increased earnings and an earnings per share growth rate that meets our long-term objectives," said Ralph Lauren, Chairman of the Board and Chief Executive Officer. "All of our business units are off to a good start in the current fiscal year and with our expected top-line growth combined with a more favorable expense structure, fiscal 2000 should be a strong year for us."
Michael J. Newman, Vice Chairman and Chief Operating Officer commented, "In fiscal 1999, we made good progress in each of our operating units, with wholesale revenues increasing 15% over the prior year, retail posting a 16% gain and licensing up 24%. In addition, we entered fiscal 2000 with an improved inventory position, in both absolute dollars and in the quality of the inventory. Looking forward to fiscal 2000, we see revenue, operating profit and return on equity gains in each of our businesses, and with the addition of the recently acquired Club Monaco, we are quite optimistic about the Company's financial performance."
Polo Ralph Lauren Corporation is a leader in the design, marketing and distribution of premium lifestyle products in four categories: Apparel, Home, Accessories, and Fragrances. For 30 years, Polo's reputation and distinctive image have been consistently developed across an expanding number of products, brands, and international markets. The Company's brand names, which include "Polo", "Polo by Ralph Lauren", "Polo Sport", "Ralph Lauren", "RALPH", "Lauren", "Polo Jeans Company", and "Chaps", among others, constitute one of the world's most widely recognized families of consumer brands.
The following table provides selected Balance Sheet information as of April 3, 1999 and March 28, 1998.
POLO RALPH LAUREN CORPORATION
Selected Financial Information
Balance Sheet Data
(in millions)
April 3, 1999 March 28, 1998
Inventory $377 $298
Accounts Receivable, net $157 $149
Certain statements contained herein are forward-looking statements that are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based largely on the Company's expectations and are subject to certain risks and uncertainties that could cause actual results to differ materially from those set forth in the forward-looking statement. Those risks include, among others, risks associated with changes in the competitive marketplace, including the introduction of new products or pricing changes by the Company's competitors, changes in global economic conditions and other risks and uncertainties detailed in the Company's Securities and Exchange Commission filings. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Attached are the Consolidated Statements of Income for the quarter and year ended April 3, 1999 and March 28, 1998. The Consolidated Statements of Income for the quarter and year ended April 3, 1999 present net income before restructuring charges for comparability purposes. The Pro Forma Consolidated Statement of Income for the year ended March 28, 1998 presents the effects on the historical financial statements of certain transactions as if they had occurred at the beginning of the period, including: (i) income taxes based upon pro forma pre-tax income as if the Company had been subject to additional Federal, state and local income taxes calculated using a pro forma effective tax rate of approximately 41%; and (ii) a reduction in interest costs from the application of the net proceeds from Polo's initial public offering completed in June 1997 to outstanding indebtedness.
POLO RALPH LAUREN CORPORATION
Consolidated Statements of Income
(In thousands, except share data)
Three Months Ended Fiscal Year Ended
April 3, March 28, April 3, March 28,
1999 1998* 1999 1998*
Pro Forma
Net sales $389,009 $314,522 $1,505,056 $1,303,816
Licensing revenue 54,059 41,651 208,009 167,119
Other income 2,679 3,070 13,794 9,609
Net revenues 445,747 359,243 1,726,859 1,480,544
Cost of goods sold 246,668 186,539 904,586 759,988
Gross profit 199,079 172,704 822,273 720,556
Selling, general and
administrative
expenses 151,373 126,823 608,128 520,801
Income from operations
before restructuring
charges 47,706 45,881 214,145 199,755
Interest (expense)
income (1,689) 1,897 (2,759) 3,003
Income before income
taxes and
restructuring
charges 46,017 47,778 211,386 202,758
Provision for income
taxes 18,753 19,089 86,141 82,631
Net income before
restructuring
charges 27,264 28,689 125,245 120,127
Restructuring charges,
net of taxes (34,695) -- (34,695) --
Net income (loss) ($7,431) $28,689 $90,550 $120,127
Net income per share -
Basic and Diluted
before restructuring
charges $0.27 $0.29 $1.25 $1.20
Net income (loss) per
share - Basic and
Diluted - after
restructuring charges ($0.07) $0.29 $0.91 $1.20
Common shares
outstanding
- Basic 99,622,932 100,222,444 99,813,328 100,222,444
Common shares
outstanding
- Diluted 99,782,519 100,429,365 99,972,152 100,222,444
* Reclassified for comparative purposes.
SOURCE Polo Ralph Lauren Corporation
