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Ralph Lauren (NYSE:RL) shares were must have items in early trading as the fashion firm's second quarter earnings exceeded expectations.
Although net income in the quarter fell to US$160mln from US$201mln the year before, this was not as bad as the Street had feared.
Adjusted earnings per share (EPS) slipped to US$2.13 from US$2.25 a year earlier, comfortably ahead of the US$1.74 analysts had been expecting. Reported EPS, which includes one-off items, fell to US$1.86.
Revenue declined to US$1.97bn from US$1.99bn in the same period of 2014 but was ahead of expectations of US$1.95bn.
In common with many export-focused US companies, Ralph Lauren said performance had been hampered by the strength of the dollar, while spending on a revamp of the clothing business also put a dent in profits.
Sales would have been up 4% on a year earlier but for unhelpful exchange rate movements. Retail sales were up 5% on a constant currency (CC) basis while the wholesale division saw turnover climb 3% on a CC basis.
For the final quarter of the calendar year the company reckons revenue could be anywhere between flat and up 2% year-on-year, pretty much in line with market consensus.
The shares, down a fifth year-to-date, were up 17.4% at US$133.29 in the first half hour of trading.