Ralph Lauren swings to a surprise profit and reinstates dividend

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Ralph Lauren Corp. blew past earnings estimates for its fiscal fourth quarter on Thursday, and said it may close more stores in fiscal 2022.

The retailer
RL,
-8.27%
reported a fiscal fourth-quarter net loss totaling $74.1 million, or $1.01 per share, after a loss of $249.0 million, or $3.38 per share, last year.

Adjusted EPS was 38 cents after a loss of 68 cents last year.

Revenue of $1.287 billion was up from $1.274 billion last year. Digital sales rose 52%.

The FactSet consensus was for a loss of 72 cents and revenue of $1.207 billion.

Read: Target earnings blow past estimates as owned-brand sales reach a record.

The company, which has been undergoing a strategic realignment that includes job cuts and the sale of the Club Monaco banner, says it plans to “further right-size” its corporate offices and distribution centers with 10 more store closures in fiscal 2022 possible.

The stock dropped 8.2% in midday trading to pace the S&P 500 index’s
SPX,
+0.85%
decliners. That puts the stock on track to suffer the biggest one-day post-earnings drop since it tumbled 12.3% on Feb. 2, 2017, after the company reported fiscal third-quarter 2016 results.

The stock, which has now dropped 13.8% since closing at a three-year high of $139.64 on May 7, has still climbed 16.0% year to date, while the S&P 500 has gained 10.7%.

Ralph Lauren also announced changes to the board, with Joel Fleishman, a director for the past 22 years, stepping down when his term expires in July. Hubert Joly, former Best Buy Co Inc.
BBY,
-0.30%
and currently Ralph Lauren’s finance chair, has been appointed to serve as the new lead independent director, effective after the 2021 annual meeting. Joly succeeds Frank Bennack, who will continue to serve on the board.

Don’t miss: Ralph Lauren is back in style and showing increased top-line potential.

And Ralph Lauren announced that it has reinstated its dividend for the first quarter of fiscal 2022 at $0.6875 per share, in line with pre-pandemic levels.



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