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Capri Holdings Limited Announces Second Quarter Fiscal 2021 Results

November 5, 2020



Revenue and Earnings Exceed Expectations

Q2 2021 Earnings Presentation

LONDON--(BUSINESS WIRE)-- Capri Holdings Limited (NYSE:CPRI), a global fashion luxury group, today announced its financial results for the second quarter of fiscal 2021 ended September 26, 2020.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20201105005356/en/

VERSACE, JIMMY CHOO, MICHAEL KORS (Photo: Business Wire)

Second Quarter Fiscal 2021 Highlights

  • Revenue decline of 23.0%, a significant improvement from the first quarter
    • E-commerce sales improved sequentially, increasing approximately 60%
    • Positive sales in Mainland China across all luxury houses
    • Positive global retail sales at Versace for the three months ended September
  • Adjusted gross margin expansion of 220 basis points versus prior year
  • Adjusted operating margin expansion of 240 basis points versus prior year
  • Adjusted earnings per share of $0.90

John D. Idol, the Company’s Chairman and Chief Executive Officer, said, "The COVID-19 pandemic continues to profoundly impact the entire world. My thoughts and prayers go out to all those who have been affected by the virus and to everyone on the front lines who are tirelessly helping combat this pandemic. At Capri Holdings, we are prioritizing the health and safety of our employees, customers and communities. I want to thank our teams around the world for the hard work and dedication they demonstrate every day to support each other and their communities during this unprecedented time."

Mr. Idol continued, "We were pleased with our second quarter results, with revenue and earnings surpassing our expectations. Our performance demonstrates the power and desirability of the Versace, Jimmy Choo and Michael Kors brands. Through creativity and innovation, our luxury houses inspire excitement and passion, creating an emotional connection with our consumers. We are also attracting new consumers to each of our luxury houses as evidenced by the double digit increase in our consumer databases."

Mr. Idol concluded, "As the world continues to emerge from this crisis, we are increasingly optimistic about the outlook for the fashion luxury industry and Capri Holdings. We have an incredible portfolio of luxury houses, each with their rich heritage, exclusive DNA and strong brand loyalty. We are uniquely positioned to drive multiple years of strong growth as we continue to execute on our strategic initiatives."

Second Quarter Fiscal 2021 Results

Financial Results and non-GAAP Reconciliation

The company’s results are reported in this press release in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") and on an adjusted, non-GAAP basis. A reconciliation of GAAP to non-GAAP financial information is provided at the end of this press release. Due to the current and ongoing impact of the COVID-19 pandemic, the company will not be providing comparable store sales results. The company believes the most comprehensive measure of performance in this environment is total revenues compared to the same period in the prior year.

Overview of Capri Holdings Second Quarter Fiscal 2021 Results:

  • Total revenue of $1.1 billion decreased 23.0% compared to last year. On a constant currency basis, total revenue decreased 24.6%.
  • Gross profit was $710 million and gross margin was 64.0%, compared to $874 millionand 60.6% in the prior year. Adjusted gross profit was $701 million and adjusted gross margin was 63.2%, compared to $879 million and 61.0% in the prior year.
  • Income from operations was $153 million and operating margin was 13.8% compared to $75 million and 5.2% in the prior year. Adjusted income from operations was $182 million and operating margin was 16.4%, compared to $202 million and 14.0% in the prior year.
  • Net income was $122 million, or $0.81 per diluted share compared to $73 million, or $0.47 per diluted share in the prior year. Adjusted net income was $137 million, or $0.90 per diluted share, compared to $177 million or $1.16 per diluted share in the prior year.
  • Net inventory at September 26, 2020 was $930 million, a 13% decrease compared to the prior year.

Versace Second Quarter Fiscal 2021 Results:

  • Versace revenue of $195 million decreased 14.5% compared to the prior year. On a constant currency basis, total revenue decreased 18.9%.
  • Versace operating income was $20 million and operating margin was 10.3% compared to $9 million and 3.9% in the prior year. Last year, adjusted operating income was $14 million and adjusted operating margin was 6.1%.

Jimmy Choo Second Quarter Fiscal 2021 Results:

  • Jimmy Choo revenue of $122 million decreased 2.4% compared to the prior. On a constant currency basis, total revenue decreased 6.4%.
  • Jimmy Choo operating income was break even, compared to an operating loss of $10 million and operating margin of (8.0)% in the prior year.

Michael Kors Second Quarter Fiscal 2021 Results:

  • Michael Kors revenue of $793 million decreased 27.2% compared to the prior year. On a constant currency basis, total revenue decreased 27.9%.
  • Michael Kors operating income was $190 million and operating margin was 24.0%, compared to $222 million and 20.4% in the prior year.

Fiscal Year 2021 Outlook

The company is not providing annual earnings guidance for fiscal year 2021 due to the lack of visibility surrounding the progression of the pandemic, macroeconomic fundamentals, and tourism flows.

Conference Call Information

A conference call to discuss second quarter fiscal 2021 results is scheduled for today, November 5, 2020 at 8:30 a.m. ET. A live webcast of the conference call will be available on the Company’s website, www.capriholdings.com. In addition, a replay will be available shortly after the conclusion of the call and remain available until November 12, 2020. To access the telephone replay, listeners should dial 1-844-512-2921 or 1-412-317-6671 for international callers. The access code for the replay is 10011575. A replay of the webcast will also be available within two hours of the conclusion of the call.

Upcoming Event

John D. Idol, Chairman and Chief Executive Officer, and Thomas J. Edwards, Executive Vice President, Chief Financial Officer and Chief Operating Officer, will be participating in a fireside chat at the JP Morgan Virtual Global Consumer, Retail & Luxury Conference held virtually, on Thursday, November 12, 2020 at 10:00 AM Eastern Time. The presentation will be webcast live on the Company’s Investor Relations website, www.capriholdings.com. An archived replay will be available approximately one hour after the conclusion of the live event.

Use of Non-GAAP Financial Measures

Constant currency effects are non-GAAP financial measures, which are provided to supplement our reported operating results to facilitate comparisons of our operating results and trends in our business, excluding the effects of foreign currency rate fluctuations. Because we are a global company, foreign currency exchange rates may have a significant effect on our reported results. We calculate constant currency measures and the related foreign currency impacts by translating the current year’s reported amounts into comparable amounts using prior year’s foreign exchange rates for each currency. All constant currency performance measures discussed below should be considered a supplement to and not in lieu of our operating performance measures calculated in accordance with U.S. GAAP. Additionally, this earnings release includes certain non-GAAP financial measures that exclude certain costs associated with COVID-19 related charges, long-lived asset impairments, ERP implementation costs, Capri transformation costs, restructuring and other charges. The Company uses non-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 these items helps its management and investors compare operating performance based on its ongoing operations. While the Company considers the non-GAAP measures to be useful supplemental measures in analyzing its results, they are not intended to replace, nor act as a substitute for, any amounts presented in its consolidated financial statements prepared in conformity with U.S. GAAP and may be different from non-GAAP measures reported by other companies.

About Capri Holdings Limited

Capri Holdings Limited is a global fashion luxury group, consisting of iconic brands that are industry leaders in design, style and craftsmanship. Its brands cover the full spectrum of fashion luxury categories including women’s and men’s accessories, footwear and ready-to-wear as well as wearable technology, watches, jewelry, eyewear and a full line of fragrance products. The Company’s goal is to continue to extend the global reach of its brands while ensuring that they maintain their independence and exclusive DNA. Capri Holdings Limited is publicly listed on the New York Stock Exchange under the ticker CPRI.

Forward Looking Statements

This press release contains statements which are, or may be deemed to be, “forward-looking statements.” Forward-looking statements are prospective in nature and are not based on historical facts, but rather on current expectations and projections of the management of Capri Holdings Limited (the “Company”) about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements. All statements other than statements of historical facts included herein, may be forward-looking statements. Without limitation, any statements preceded or followed by or that include the words “plans”, “believes”, “expects”, “intends”, “will”, “should”, “could”, “would”, “may”, “anticipates”, “might” or similar words or phrases, are forward-looking statements. These forward-looking statements are not guarantees of future financial performance. Such forward-looking statements involve known and unknown risks and uncertainties that could significantly affect expected results and are based on certain key assumptions, which could cause actual results to differ materially from those projected or implied in any forward-looking statements. These risks, uncertainties and other factors include the effect of the COVID-19 pandemic and its potential material and significant impact on the Company’s future financial and operational results if retail stores are forced to close again and the pandemic is prolonged, including that our estimates could materially differ if the severity of the COVID-19 situation worsens, the length and severity of such outbreak across the globe and the pace of recovery following the COVID-19 pandemic, levels of cash flow and future availability of credit, compliance with restrictive covenants under the Company’s credit agreement, the Company’s ability to integrate successfully and to achieve anticipated benefits of any acquisition; the risk of disruptions to the Company’s businesses; the negative effects of events on the market price of the Company’s ordinary shares and its operating results; significant transaction costs; unknown liabilities; the risk of litigation and/or regulatory actions related to the Company’s businesses; fluctuations in demand for the Company’s products; levels of indebtedness (including the indebtedness incurred in connection with acquisitions); the timing and scope of future share buybacks, which may be made in open market or privately negotiated transactions, and are subject to market conditions, applicable legal requirements, trading restrictions under the Company’s insider trading policy and other relevant factors, and which share repurchases may be suspended or discontinued at any time, the level of other investing activities and uses of cash; changes in consumer traffic and retail trends; loss of market share and industry competition; fluctuations in the capital markets; fluctuations in interest and exchange rates; the occurrence of unforeseen epidemics and pandemics, disasters or catastrophes; political or economic instability in principal markets; adverse outcomes in litigation; and general, local and global economic, political, business and market conditions, as well as those risks set forth in the Company’s filings with the U.S. Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the fiscal year ended March 28, 2020 (File No. 001-35368). Any forward-looking statement in this press release speaks only as of the date made and the Company disclaims any obligation to update or revise any forward-looking or other statements contained herein other than in accordance with legal and regulatory obligations.

 

SCHEDULE 1

CAPRI HOLDINGS LIMITED AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except share and per share data)

(Unaudited)

 

 

Three Months Ended

 

Six Months Ended

 

 

September 26,
2020

 

September 28,
2019

 

September 26,
2020

 

September 28,
2019

Total revenue

 

$

1,110

 

 

$

1,442

 

 

$

1,561

 

 

$

2,788

 

Cost of goods sold

 

400

 

 

568

 

 

549

 

 

1,080

 

Gross profit

 

710

 

 

874

 

 

1,012

 

 

1,708

 

Total operating expenses

 

557

 

 

799

 

 

1,021

 

 

1,569

 

Income (Loss) from operations

 

153

 

 

75

 

 

(9)

 

 

139

 

Other income, net

 

 

 

(1)

 

 

(1)

 

 

(3)

 

Interest expense, net

 

12

 

 

3

 

 

29

 

 

16

 

Foreign currency (gain) loss

 

 

 

4

 

 

(3)

 

 

6

 

Income (loss) before provision for income taxes

 

141

 

 

69

 

 

(34)

 

 

120

 

Provision for (benefit from) income taxes

 

20

 

 

(4)

 

 

25

 

 

2

 

Net income (loss)

 

121

 

 

73

 

 

(59)

 

 

118

 

Less: Net loss attributable to noncontrolling interests

 

(1)

 

 

 

 

(1)

 

 

 

Net income (loss) attributable to Capri

 

$

122

 

 

$

73

 

 

$

(58)

 

 

$

118

 

Weighted average ordinary shares outstanding:

 

 

 

 

 

 

 

 

Basic

 

150,492,275

 

 

151,602,502

 

 

150,024,293

 

 

151,326,037

 

Diluted

 

151,677,242

 

 

152,576,283

 

 

150,024,293

 

 

152,455,218

 

Net income (loss) per ordinary share:

 

 

 

 

 

 

 

 

Basic

 

$

0.81

 

 

$

0.48

 

 

$

(0.39)

 

 

$

0.78

 

Diluted

 

$

0.81

 

 

$

0.47

 

 

$

(0.39)

 

 

$

0.77

 

 

SCHEDULE 2

CAPRI HOLDINGS LIMITED AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In millions, except share data)

(Unaudited)

 

 

September 26,
2020

 

March 28,
2020

 

September 28,
2019

Assets

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Cash and cash equivalents

 

$

238

 

 

$

592

 

 

$

179

 

Receivables, net

 

344

 

 

308

 

 

368

 

Inventories, net

 

930

 

 

827

 

 

1,073

 

Prepaid expenses and other current assets

 

122

 

 

167

 

 

275

 

Total current assets

 

1,634

 

 

1,894

 

 

1,895

 

Property and equipment, net

 

530

 

 

561

 

 

589

 

Operating lease right-of-use assets

 

1,677

 

 

1,625

 

 

1,671

 

Intangible assets, net

 

2,024

 

 

1,986

 

 

2,171

 

Goodwill

 

1,539

 

 

1,488

 

 

1,598

 

Deferred tax assets

 

226

 

 

225

 

 

160

 

Other assets

 

173

 

 

167

 

 

309

 

Total assets

 

$

7,803

 

 

$

7,946

 

 

$

8,393

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

 

$

558

 

 

$

428

 

 

$

390

 

Accrued payroll and payroll related expenses

 

92

 

 

93

 

 

97

 

Accrued income taxes

 

39

 

 

42

 

 

27

 

Current operating lease liabilities

 

439

 

 

430

 

 

403

 

Short-term debt

 

200

 

 

167

 

 

603

 

Accrued expenses and other current liabilities

 

253

 

 

241

 

 

283

 

Total current liabilities

 

1,581

 

 

1,401

 

 

1,803

 

Long-term operating lease liabilities

 

1,772

 

 

1,758

 

 

1,766

 

Deferred tax liabilities

 

483

 

 

465

 

 

440

 

Long-term debt

 

1,581

 

 

2,012

 

 

1,796

 

Other long-term liabilities

 

187

 

 

142

 

 

176

 

Total liabilities

 

5,604

 

 

5,778

 

 

5,981

 

Commitments and contingencies

 

 

 

 

 

 

Redeemable noncontrolling interest

 

 

 

 

 

4

 

Shareholders’ equity

 

 

 

 

 

 

Ordinary shares, no par value; 650,000,000 shares authorized; 218,563,307 shares issued and 150,621,274 outstanding at September 26, 2020; 217,320,010 shares issued and 149,425,612 outstanding at March 28, 2020 and 216,815,137 shares issued and 151,633,281 outstanding at September 28, 2019

 

 

 

 

 

 

Treasury shares, at cost 67,942,033 shares at September 26, 2020, 67,894,398 shares at March 28, 2020 and 65,181,856 shares at September 28, 2019

 

(3,326)

 

 

(3,325)

 

 

(3,225)

 

Additional paid-in capital

 

1,126

 

 

1,085

 

 

1,060

 

Accumulated other comprehensive income (loss)

 

125

 

 

75

 

 

(103)

 

Retained earnings

 

4,274

 

 

4,332

 

 

4,673

 

Total shareholders’ equity of Capri

 

2,199

 

 

2,167

 

 

2,405

 

Noncontrolling interest

 

 

 

1

 

 

3

 

Total shareholders’ equity

 

2,199

 

 

2,168

 

 

2,408

 

Total liabilities and shareholders’ equity

 

$

7,803

 

 

$

7,946

 

 

$

8,393

 

 

 

 

 

 

 

 

 

 

SCHEDULE 3

CAPRI HOLDINGS LIMITED AND SUBSIDIARIES

CONSOLIDATED SEGMENT DATA

($ in millions)

(Unaudited)

 

 

Three Months Ended

 

Six Months Ended

 

 

September 26,
2020

 

September 28,
2019

 

September 26,
2020

 

September 28,
2019

Revenue by Segment and Region:

 

 

 

 

 

 

 

 

Versace

 

The Americas

 

$

60

 

 

$

48

 

 

$

75

 

 

$

92

 

 

 

EMEA

 

80

 

 

121

 

 

107

 

 

213

 

 

 

Asia

 

55

 

 

59

 

 

106

 

 

130

 

Versace Revenue

 

195

 

 

228

 

 

288

 

 

435

 

 

 

 

 

 

 

 

 

 

 

 

Jimmy Choo

 

The Americas

 

33

 

 

21

 

 

39

 

 

51

 

 

 

EMEA

 

46

 

 

64

 

 

62

 

 

143

 

 

 

Asia

 

43

 

 

40

 

 

72

 

 

89

 

Jimmy Choo Revenue

 

122

 

 

125

 

 

173

 

 

283

 

 

 

 

 

 

 

 

 

 

 

 

Michael Kors

 

The Americas

 

494

 

 

733

 

 

650

 

 

1,388

 

 

 

EMEA

 

185

 

 

224

 

 

264

 

 

413

 

 

 

Asia

 

114

 

 

132

 

 

186

 

 

269

 

Michael Kors Revenue

 

793

 

 

1,089

 

 

1,100

 

 

2,070

 

 

 

 

 

 

 

 

 

 

Total Revenue

 

$

1,110

 

 

$

1,442

 

 

$

1,561

 

 

$

2,788

 

 

 

 

 

 

 

 

 

 

Income (loss) from Operations:

 

 

 

 

 

 

 

 

Versace

 

 

 

$

20

 

 

$

9

 

 

$

(21)

 

 

$

6

 

Jimmy Choo

 

 

 

 

 

(10)

 

 

(29)

 

 

1

 

Michael Kors

 

 

 

190

 

 

222

 

 

142

 

 

423

 

Total segment income from operations

 

210

 

 

221

 

 

92

 

 

430

 

Less: Corporate expenses

 

(30)

 

 

(35)

 

 

(61)

 

 

(68)

 

Restructuring and other charges

 

(9)

 

 

(7)

 

 

(17)

 

 

(22)

 

Impairment of assets

 

(20)

 

 

(104)

 

 

(20)

 

 

(201)

 

COVID-19 related charges

2

 

 

 

 

(3)

 

 

 

Total Income (Loss) from Operations

 

$

153

 

 

$

75

 

 

$

(9)

 

 

$

139

 

 

 

 

 

 

 

 

 

 

 

 

Operating Margin:

 

 

 

 

 

 

 

 

 

 

Versace

 

 

 

10.3

%

 

3.9

%

 

(7.3)

%

 

1.4

%

Jimmy Choo

 

 

 

%

 

(8.0)

%

 

(16.8)

%

 

0.4

%

Michael Kors

 

 

 

24.0

%

 

20.4

%

 

12.9

%

 

20.4

%

Capri Operating Margin

 

 

 

13.8

%

 

5.2

%

 

(0.6)

%

 

5.0

%

 

SCHEDULE 4

CAPRI HOLDINGS LIMITED AND SUBSIDIARIES

SUPPLEMENTAL RETAIL STORE INFORMATION

(Unaudited)

 

 

 

 

As of

Retail Store Information:

 

September 26,
2020

 

September 28,
2019

Versace

 

206

 

 

198

 

Jimmy Choo

 

227

 

 

216

 

Michael Kors

 

828

 

 

850

 

Total number of retail stores

 

 

 

1,261

 

 

1,264

 

 

SCHEDULE 5

CAPRI HOLDINGS LIMITED AND SUBSIDIARIES

CONSTANT CURRENCY DATA

(In millions)

(Unaudited)

 

 

Three Months Ended

 

% Change

 

 

September 26,
2020

 

September 28,
2019

 

As
Reported

 

Constant
Currency

Total revenue:

 

 

 

 

 

 

 

 

Versace

 

195

 

 

$

228

 

 

(14.5)

%

 

(18.9)

%

Jimmy Choo

 

122

 

 

125

 

 

(2.4)

%

 

(6.4)

%

Michael Kors

 

793

 

 

1,089

 

 

(27.2)

%

 

(27.9)

%

Total revenue

 

$

1,110

 

 

$

1,442

 

 

(23.0)

%

 

(24.6)

%

 

 

 

Six Months Ended

 

% Change

 

 

September 26,
2020

 

September 28,
2019

 

As
Reported

 

Constant
Currency

Total revenue:

 

 

 

 

 

 

 

 

Versace

 

$

288

 

 

$

435

 

 

(33.8)

%

 

(35.6)

%

Jimmy Choo

 

173

 

 

283

 

 

(38.9)

%

 

(40.6)

%

Michael Kors

 

1,100

 

 

2,070

 

 

(46.9)

%

 

(47.1)

%

Total revenue

 

$

1,561

 

 

$

2,788

 

 

(44.0)

%

 

(44.7)

%

 

 

 

 

 

 

 

 

 

 

SCHEDULE 6

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(In millions, except share and per share data)

(Unaudited)

 

 

Three Months Ended September 26, 2020

 

 

As
Reported

 

Impairment Charges

 

Restructuring
and Other
Charges(1)

 

COVID-19
Related
Charges

 

Capri
Transformation

 

As
Adjusted

Gross profit

 

$

710

 

 

$

 

 

$

 

 

$

(9)

 

 

$

 

 

$

701

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

$

557

 

 

$

(20)

 

 

$

(9)

 

 

$

(7)

 

 

$

(2)

 

 

$

519

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total income (loss) from operations

 

$

153

 

 

$

20

 

 

$

9

 

 

$

(2)

 

 

$

2

 

 

$

182

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before provision for
income taxes

 

$

141

 

 

$

20

 

 

$

9

 

 

$

(2)

 

 

$

2

 

 

$

170

 

Provision for income taxes

 

$

20

 

 

$

9

 

 

$

4

 

 

$

 

 

$

1

 

 

$

34

 

Net income (loss) attributable to
Capri

 

$

122

 

 

$

11

 

 

$

5

 

 

$

(2)

 

 

$

1

 

 

$

137

 

Diluted net income (loss) per
ordinary share - Capri

 

$

0.81

 

 

$

0.07

 

 

$

0.03

 

 

$

(0.02)

 

 

$

0.01

 

 

$

0.90

 

_____________________

  1. Includes store closure costs which have been incorporated into the Capri Retail Store Optimization Program and other costs recorded in connection with the acquisitions of Gianni Versace S.r.l. and Jimmy Choo Group Limited.

 

SCHEDULE 7

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(In millions, except share and per share data)

(Unaudited)

 

 

Six Months Ended September 26, 2020

 

 

As
Reported

 

Impairment
Charges

 

Restructuring
and Other
Charges(1)

 

COVID-19 Related Charges

 

Capri Transformation

 

ERP Implementation

 

As
Adjusted

Gross profit

 

$

1,012

 

 

$

 

 

$

 

 

$

(8)

 

 

$

 

 

$

 

 

$

1,004

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

$

1,021

 

 

$

(20)

 

 

$

(17)

 

 

$

(11)

 

 

$

(2)

 

 

$

(2)

 

 

$

969

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total (loss) income from operations

 

$

(9)

 

 

$

20

 

 

$

17

 

 

$

3

 

 

$

2

 

 

$

2

 

 

$

35

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Loss) income before provision for
income taxes

 

$

(34)

 

 

$

20

 

 

$

17

 

 

$

3

 

 

$

2

 

 

$

2

 

 

$

10

 

Provision for (benefit from) income
taxes

 

$

25

 

 

$

9

 

 

$

(1)

 

 

$

(3)

 

 

$

1

 

 

$

(1)

 

 

$

30

 

Net (loss) income attributable to
Capri

 

$

(58)

 

 

$

11

 

 

$

18

 

 

$

6

 

 

$

1

 

 

$

3

 

 

$

(19)

 

Diluted net (loss) income per
ordinary share - Capri

 

$

(0.39)

 

 

$

0.07

 

 

$

0.12

 

 

$

0.04

 

 

$

0.01

 

 

$

0.02

 

 

$

(0.13)

 

______________________

  1. Includes store closure costs recorded in connection with the Michael Kors Retail Fleet Optimization Plan and other restructuring initiatives, and other costs recorded in connection with the acquisitions of Gianni Versace S.r.l. and Jimmy Choo Group Limited.

 

SCHEDULE 8

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(In millions, except share and per share data)

(Unaudited)

 

 

Three Months Ended September 28, 2019

 

 

As Reported

 

Impairment
Charges

 

Restructuring
and Other
Charges (1)

 

Inventory
Step-up Adjustment

 

ERP
Implementation

 

Capri
Transformation

 

Acquisition
Foreign
Currency
Effects

 

As Adjusted

Gross profit

 

$

874

 

 

$

 

 

$

 

 

$

5

 

 

$

 

 

$

 

 

$

 

 

$

879

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

$

799

 

 

$

(104)

 

 

$

(7)

 

 

$

 

 

$

(9)

 

 

$

(2)

 

 

$

 

 

$

677

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Versace operating income

 

$

9

 

 

$

 

 

$

 

 

$

5

 

 

$

 

 

$

 

 

$

 

 

$

14

 

Total income from operations

 

$

75

 

 

$

104

 

 

$

7

 

 

$

5

 

 

$

9

 

 

$

2

 

 

$

 

 

$

202

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency loss (gain)

 

$

4

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

(1)

 

 

$

3

 

Income before provision for income taxes

 

$

69

 

 

$

104

 

 

$

7

 

 

$

5

 

 

$

9

 

 

$

2

 

 

$

1

 

 

$

197

 

(Benefit from) provision for income taxes

 

$

(4)

 

 

$

18

 

 

$

2

 

 

$

1

 

 

$

2

 

 

$

1

 

 

$

 

 

$

20

 

Net income attributable to Capri

 

$

73

 

 

$

86

 

 

$

5

 

 

$

4

 

 

$

7

 

 

$

1

 

 

$

1

 

 

$

177

 

Diluted net income per ordinary share -
Capri

 

$

0.47

 

 

$

0.56

 

 

$

0.03

 

 

$

0.03

 

 

$

0.05

 

 

$

0.01

 

 

$

0.01

 

 

$

1.16

 

______________________

  1. Includes store closure costs recorded in connection with the Michael Kors Retail Fleet Optimization Plan and other restructuring initiatives, and other costs recorded in connection with the acquisitions of Gianni Versace S.r.l and Jimmy Choo Group Limited.

 

SCHEDULE 9

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(In millions, except share and per share data)

(Unaudited)

 

 

Six Months Ended September 28, 2019

 

 

As Reported

 

Impairment Charges

 

Restructuring and Other
Charges(1)

 

Inventory
Step-up
Adjustment

 

ERP
Implementation

 

Capri
Transformation

 

Acquisition
Foreign
Currency Effects

 

As Adjusted

Gross profit

 

$

1,708

 

 

$

 

 

$

 

 

$

11

 

 

$

 

 

$

 

 

$

 

 

$

1,719

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total operating expenses

 

$

1,569

 

 

$

(201)

 

 

$

(22)

 

 

$

 

 

$

(17)

 

 

$

(2)

 

 

$

 

 

$

1,327

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Versace operating income

 

$

6

 

 

$

 

 

$

 

 

$

11

 

 

$

 

 

$

 

 

$

 

 

$

17

 

Total income from operations

 

$

139

 

 

$

201

 

 

$

22

 

 

$

11

 

 

$

17

 

 

$

2

 

 

$

 

 

$

392

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency loss (gain)

 

$

6

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

 

 

$

(1)

 

 

$

5

 

Income before provision for income taxes

 

$

120

 

 

$

201

 

 

$

22

 

 

$

11

 

 

$

17

 

 

$

2

 

 

$

1

 

 

$

374

 

Provision for income taxes

 

$

2

 

 

$

37

 

 

$

5

 

 

$

3

 

 

$

4

 

 

$

1

 

 

$

 

 

$

52

 

Net income attributable to Capri

 

$

118

 

 

$

164

 

 

$

17

 

 

$

8

 

 

$

13

 

 

$

1

 

 

$

1

 

 

$

322

 

Weighted average diluted ordinary shares
outstanding

 

152,455,218

 

 

 

 

 

 

 

 

 

 

 

 

 

 

152,455,218

 

Diluted net income per ordinary share -
Capri

 

$

0.77

 

 

$

1.08

 

 

$

0.11

 

 

$

0.05

 

 

$

0.08

 

 

$

0.01

 

 

$

0.01

 

 

$

2.11

 

______________________

  1. Includes store closure costs recorded in connection with the Michael Kors Retail Fleet Optimization Plan and other restructuring initiatives, and other costs recorded in connection with the acquisitions of Gianni Versace S.r.l and Jimmy Choo Group Limited.

 

Investor Relations:
Jennifer Davis
(201) 514-8234
Jennifer.Davis@CapriHoldings.com

Media:
Dinesh Kandiah
(917) 934-2427
Press@CapriHoldings.com

Source: Capri Holdings Limited




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