Ralph Lauren Q4 Profit Rises; Executive Vice Chairman Roger Farah To Retire

(RTTNews) - Apparel maker Ralph Lauren Corp. (RL) reported that its net income for the fourth quarter of fiscal 2014 increased to $153 million or $1.68 per share, from $127 million, or $1.37 per share, for the fourth quarter of Fiscal 2013. Analysts polled by Thomson Reuters expected the company to report earnings of $1.63 per share for the quarter. Analysts' estimates typically exclude special items.

The increase in net income and net income per share was primarily a result of the improved operating income that was partially offset by a higher effective tax rate of 30% compared to 25% in the fourth quarter of Fiscal 2013, primarily due to a favorable discrete tax item in the prior year period.

Net revenues for the fourth quarter rose 14% to $1.87 billion from $1.64 billion last year. The increase in net revenues reflected robust wholesale segment growth and strong retail segment expansion. Wall Street expected revenues of $1.83 billion.

In the first quarter of Fiscal 2015, the Company expects consolidated net revenues to increase by 3%-5%, led by retail segment growth. Operating margin for the first quarter of Fiscal 2015 is expected to be approximately 300-350 basis points below the comparable prior year period, primarily due to the timing of investments to support the Company's strategic growth objectives. Analysts expects the company to report revenues of $1.81 billion for the first quarter.

The company currently expects consolidated net revenues for Fiscal 2015 to increase by 6%-8%. Operating margin for Fiscal 2015 is currently expected to be 75-125 basis points below the prior year's level due to continued investment in the Company's global retail development and infrastructure, in addition to increased advertising and marketing expense. Capital expenditures are planned at approximately $400-$500 million in Fiscal 2015. Analysts expects the company to report revenues of $8.04 billion for Fiscal 2015.

Separately, Ralph Lauren announced that Roger Farah, Executive Vice Chairman, will retire from the Company at the end of May. Farah will remain on the Company's Board of Directors until the expiration of his term on the date of the Company's 2014 Annual Meeting of Stockholders in August 2014.