NEW YORK – Michael Kors Holdings Ltd. reported robust quarterly results as its namesake luxury brand saw strong demand, and said it expects its accessories business to drive profits in the coming quarters.
Shares of the designer apparel and accessories company jumped 26 percent to $42.19 on Tuesday on the New York Stock Exchange, their highest since the stock’s Dec. 15 debut.
The stock, which had risen 39 percent through Monday’s close, was trading up 22 percent at $41.25 in late morning trade. It was the biggest percentage gainer on the exchange.
Chief Executive John Idol attributed the quarterly performance to “the strong demand for the Michael Kors luxury brand, our exciting assortment of fashion merchandise and our exceptional jet-set in-store experience.”
Last week, larger rival Ralph Lauren Corp. also reported strong results for the holiday quarter, helped by double-digit sales growth at its own stores as well as increased sales to department stores.
The luxury goods industry has rebounded strongly after the sharp downturn of 2009, and watchmakers, luxury hotels, fashion and leather goods groups were widely expected to close 2011 on a strong note.
Michael Kors, which is known for its glitzy designs and primarily caters to women in the 30-40 age group, expects a fourth-quarter profit of 10 cents to 12 cents a share.
Wall Street analysts were looking for earnings of 11 cents a share, according to Thomson Reuters I/B/E/S.
“I think it’s a conservative guidance and sets them up for a beat in the fourth quarter,” Wedbush Securities analyst Corinna Freedman told Reuters.