NEW YORK – Shares of Polo Ralph Lauren stock dove 10 percent as the apparel company announced disappointing first quarter fiscal 2008 numbers today. Net income was $88 million (82 cents per diluted share) for the first quarter, versus Q1 2007’s $80 million (74 cents per diluted share), which was a net income growth of 10 percent and a growth of 11 percent in diluted earnings per share, but it wasn’t enough to reach analysts’ earlier performance predictions. Revised forecasts are predicting a lackluster second quarter to come.
The company is putting a positive spin on the news, focusing on the growth: “The momentum in our European business is especially encouraging, and we are excited by our new opportunities in Japan,” said CEO Ralph Lauren. “We are fortunate to have the talent and financial strength to pursue multiple initiatives. We recently completed our first American Living line review and I came away even more convinced of the tremendous growth potential for our Global Brand Concepts business.”
Observers blame the shrinking department store market, among other factors, and Polo’s investment in its Global Brands Concepts is a response to such market pressures.