Just as Polo Ralph Lauren is getting ready to take its victory laps in Vancouver -- in knit caps covered with moose, no less -- the company says it has achieved record financial results this quarter, despite the miserable retail environment.
While revenues for its fiscal third quarter slipped 1% to $1.2 billion, the company says its net income rose $111 million, up from $105 million in the same period a year ago. And while wholesale suffered -- both in the U.S. and Japan -- comparable-store sales for the quarter rose 4% at its retail stores, 6% at its factory stores, and 7% at its Club Monaco brand, Roger Farah, president/CEO, told investors during a conference call. Traffic to its Web sites continues to grow in the double-digits, he said. As a result of the better-than-expected trends, the company revised its forecasts.
In part, he says, the strong results are due to the company's ongoing investment in advertising, marketing, and public relations -- adding that "our long-standing association with premiere sporting events, such as the Olympics, Wimbledon and the U.S. Open, accentuate our global visibility and allure."
The company, which is the official outfitter of the U.S. Olympic and Paralympic Teams for both the 2010 games in Vancouver as well as the 2012 games in London, unveiled its opening and closing ceremony uniforms on the "Today Show" this week. In addition to the parade outfits for the U.S. teams, the company also designed a collection of village wear and accessories, which it provides to athletes.
Farah also fielded a question about what the company has learned from American Living, the private-label brand it created with JC Penney almost two years ago. "It's been an interesting journey," he says, "and we launched into a much more difficult environment than we had expected. We've learned a lot about customer preferences in terms of color palettes, product offerings, and fashion consciousness -- as well as price. We came out higher, and now we've moderated those prices."
AL is still Penney's premium brand, he says, but the price differential is less noticeable. "We've also looked at marketing and advertising messaging -- how we talked to that customer, how we shaped that message," he says. Changes will be evident in ads and merchandise for the spring and fall campaigns. "We're very excited about where this is going to go," he says.