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Ralph Lauren profit margin up 60 per cent in Q3

For the third quarter of fiscal 2018, Ralph Lauren’s gross profit margin was 60.7 per cent. The gross margin increase was driven by initiatives to improve quality of sales through reduced promotional activity, favorable geographic and channel mix shifts, and improved product costs.

Revenue decreased by four per cent on a reported basis and was down six per cent in constant currency, driven by initiatives to increase quality of sales, reduce promotional activity, and elevate distribution, as well as brand exits and lower consumer demand.

Operating income declined one per cent to the prior year period and operating margin was 13.2 per cent, excluding restructuring-related and other charges from both periods. The brand is celebrating its 50th anniversary. Focused execution on key initiatives, especially during the important holiday period, delivered better-than-expected results for the third quarter as the company drove lower discounting and better quality of sales overall. Now the focus is on returning to industry-leading revenue and earnings growth.

In the fourth quarter of 2018, the company expects net revenue to be down by eight or ten per cent, excluding the impact of foreign currency. It continues to hope net revenue to decrease by eight or nine per cent for 2018, excluding the impact of foreign currency.