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Thursday, November 08, 2007
A Tougher Turf Ahead: Polo Reduces Outlook Over Economy Worries
Published: Thursday, November 08, 2007
(Page 2 of 2)
Revenues rose 11.3 percent to $1.3 billion from $1.17 billion, which included a 12.8 percent gain in sales to $1.25 billion from $1.1 billion. The balance of the revenues came from licensing income. Wholesale sales jumped 17 percent to $771.8 million from $659.9 million, due in part to growth in Europe, men's wear products and the Chaps brand.

At retail, sales rose 6.6 percent to $474 million from $444.6 million, while overall same-store sales gained 4.5 percent. By retail operation, comps rose 5 percent at Ralph Lauren stores, were up 4.2 percent at its factory stores, increased 5.5 percent at Club Monaco stores and jumped 28 percent at RalphLauren.com.

The quarter's results were impacted in part by increases in both total selling, general and administrative expenses to $502.6 million from $417.7 million last year and interest expenses of $6.2 million from $4.5 million a year ago.

"The global desirability of the Ralph Lauren brand continues to expand at a strong rate across all product categories," said Ralph Lauren, chairman and chief executive officer, in a statement.

For the nine months, profits declined by 6.3 percent to $203.6 million, or $1.92 a diluted share, from $217.2 million, or $2.02, last year. Total revenues were up 11.7 percent to $2.37 billion from $2.12 billion. Sales rose 13 percent to $2.27 billion from $2.01 billion, which included a 16.9 percent gain in wholesale sales to $1.35 billion from $1.15 billion and a 7.9 percent increase in retail sales to $924 million from $856.7 million.

Shares of the company finished the day up 2.1 percent to $67.73, which was in stark contrast to how most indices fared on Wall Street Wednesday. The Dow Jones Industrial Average shed 2.6 percent to 13,300.02, while the S&P 500 finished the day down 2.9 percent to 1,475.62 and the S&P Retail Index lost 1.6 percent to 430.66.
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Roger Farah