Michael Kors Holdings Limited Announces Second Quarter Fiscal 2013 Results

  Michael Kors Holdings Limited Announces Second Quarter Fiscal 2013 Results

     Total Revenue Increased 74%; Comparable Store Sales Increased 45.1%

                 Reported Diluted EPS Increased 123% to $0.49

Business Wire

HONG KONG -- November 13, 2012

Michael Kors Holdings Limited (NYSE:KORS) (the “Company”), a global luxury
lifestyle brand with a multi-channel strategy, unique design and strong
infrastructure, today announced its financial results for the second quarter
ended September 29, 2012.

John D. Idol, the Company’s Chairman and Chief Executive Officer, said, “We
were pleased to have delivered record results in the second quarter. Our
performance is a reflection of Michael Kors’ brand strength, innovative
fashion design and the successful execution of our growth strategies. We are
excited to see the growing global recognition and appeal for the Michael Kors
luxury brand.”

For the second quarter ended September 29, 2012:

  *Total revenue increased 74% to $532.9 million from $305.5 million in the
    second quarter of fiscal 2012.
  *Retail net sales increased 82% to $242.3 million driven by a 45.1%
    increase in comparable store sales and 66 new store openings since the end
    of the second quarter last year. Wholesale net sales increased 75% to
    $270.8 million and licensing revenue increased 13% to $19.9 million.
  *Gross profit increased 80% to $315.9 million, and as a percentage of total
    revenue increased to 59.3% compared to 57.3% in the second quarter of
    fiscal 2012.
  *Income from operations was $157.9 million and as a percentage of total
    revenue was 29.6%. For the second quarter of fiscal 2012, income from
    operations was $59.3 million and included a $10.7 million charge related
    to the employee share option redemption associated with our private
    placement. Excluding this amount, income from operations was $70.0
    million, or 22.9% as a percentage of total revenue.
  *Net income was $97.8 million, or $0.49 per diluted share, based on 200.2
    million weighted average diluted shares outstanding. Net income for the
    second quarter of fiscal 2012 was $40.6 million, or $0.22 per diluted
    share, based on 187.6 million weighted average diluted shares outstanding.
    Excluding the aforementioned charge, net income for the second quarter of
    fiscal 2012 was $47.5 million, or $0.25 per diluted share.
  *At September 29, 2012, the Company operated 269 retail stores, including
    concessions, compared to 203 retail stores, including concessions, at the
    end of the same prior-year period. The Company had 80 additional retail
    stores, including concessions, operated through licensing partners.
    Including licensed locations, there were 349 Michael Kors stores worldwide
    at the end of the second quarter.

Mr. Idol continued, “Michael Kors delivered another outstanding quarter with
exceptional sales growth across our business segments and geographies. Our
North America comparable store sales growth of 45.1% demonstrates the strong
demand for Michael Kors products as we continue to offer a compelling
assortment of luxury merchandise and exceptional service in a jet set store
environment. The net sales growth of 76% in our North America wholesale
segment reflects the continued successful conversion to shop-in-shops in
department stores as well as exceptional comparable store sales. We continue
to gain brand acceptance in Europe as evidenced by the 97% sales growth we
achieved in this region. Finally, in our licensing segment, we achieved 13%
growth, which was driven primarily by ongoing strength in watches. We remain
very excited about the long term growth prospects for our company as a global
luxury lifestyle brand.”

For the first six months ended September 29, 2012:

  *Total revenue for the first six months increased 73% to $947.8 million
    from $548.7 million in the same period of fiscal 2012.
  *Retail net sales increased 79% to $457.3 million driven by a 41.3%
    increase in comparable store sales and 66 new store openings since the end
    of the second quarter last year. Wholesale net sales increased 71% to
    $453.2 million and licensing revenue increased 31% to $37.4 million.
  *Gross profit for the first six months increased 82% to $566.9 million, and
    as a percentage of total revenue increased to 59.8% as compared to 56.9%
    in the same period of fiscal 2012.
  *Income from operations for the first six months was $269.9 million and as
    a percentage of total revenue was 28.5%. For the same period of fiscal
    2012, income from operations was $104.3 million and included a $10.7
    million charge related to the employee share option redemption associated
    with our private placement. Excluding this amount, income from operations
    was $114.9 million, or 21.0% as a percentage of total revenue in fiscal
    2012.
  *Net income for the first six months was $166.5 million, or $0.83 per
    diluted share, based on 199.8 million weighted average diluted shares
    outstanding. Net income for the first six months of fiscal 2012 was $64.7
    million, or $0.35 per diluted share, based on 183.4 million weighted
    average diluted shares outstanding. Excluding the aforementioned charge,
    net income for the first six months of fiscal 2012 was $71.3 million, or
    $0.39 per diluted share.

Outlook

For the third quarter of fiscal 2013, the Company expects total revenue to be
in the range of $525 million to $535 million. This assumes a mid-twenty
percent comparable store sales increase. Diluted earnings per share are
expected to be in the range of $0.37 to $0.39 for the third quarter of fiscal
2013. This assumes 202 million diluted weighted average shares outstanding and
a 38% tax rate.

For fiscal 2013, the Company now expects total revenue to be in the range of
$1.86 billion to $1.96 billion. This assumes a comparable store sales increase
of approximately 30%. Diluted earnings per share are now expected to be in the
range of $1.48 to $1.50 for fiscal 2013. This assumes 201.2 million diluted
weighted average shares outstanding and a 38% tax rate.

Conference Call Information

A conference call to discuss second quarter results is scheduled for today,
November 13, 2012 at 8:00 a.m. EDT. A replay of the call will be available
today at 11:00 a.m. EDT; to access the replay, dial 1-877-870-5176 for
domestic callers or dial 1-858-384-5517 for international callers and enter
access code 3420252. The conference call will also be webcast live in the
investor relations section of www.michaelkors.com. The webcast will be
accessible on the website for approximately 90 days after the call.

About Michael Kors

Michael Kors is a world-renowned, award-winning designer of luxury accessories
and ready to wear. His namesake company, established in 1981, currently
produces a range of products through his Michael Kors, KORS Michael Kors and
MICHAEL Michael Kors labels, including accessories, footwear, watches,
jewelry, men’s and women’s ready to wear, and a full line of fragrance
products. Michael Kors stores are operated, either directly or through
licensing partners, in some of the most prestigious cities in the world,
including New York, Beverly Hills, Chicago, London, Milan, Paris, Munich,
Istanbul, Dubai, Seoul, Tokyo and Hong Kong.

Forward Looking Statements

This press release contains forward-looking statements. You should not place
undue reliance on such statements because they are subject to numerous
uncertainties and factors relating to the Company’s operations and business
environment, all of which are difficult to predict and many of which are
beyond the Company’s control. Forward-looking statements include information
concerning the Company’s possible or assumed future results of operations,
including descriptions of its business strategy. These statements often
include words such as “may,” “will,” “should,” “believe,” “expect,” “seek,”
“anticipate,” “intend,” “plan,” “estimate” or similar expressions. The
forward-looking statements contained in this press release are based on
assumptions that the Company has made in light of management’s experience in
the industry as well as its perceptions of historical trends, current
conditions, expected future developments and other factors that it believes
are appropriate under the circumstances. You should understand that these
statements are not guarantees of performance or results. They involve known
and unknown risks, uncertainties and assumptions. Although the Company
believes that these forward-looking statements are based on reasonable
assumptions, you should be aware that many factors could affect its actual
financial results or results of operations and could cause actual results to
differ materially from those in these forward-looking statements. These
factors are more fully discussed in the “Risk Factors” section and elsewhere
in the Company’s Registration Statement on Form F-1 , as amended(File No.
333-183778), filed on September 21, 2012 with the U.S. Securities and Exchange
Commission.

                                                                     
SCHEDULE 1

MICHAEL KORS HOLDINGS LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(In thousands, except share and per share data)
(Unaudited)

                  Three Months Ended                      Six Months Ended
                  September 29,       October 1,          September 29,       October 1,
                  2012                2011                2012                2011
Net sales         $ 513,065           $ 287,925           $ 910,435           $ 520,207
Licensing          19,870            17,607            37,365            28,451      
revenue
Total revenue       532,935             305,532             947,800             548,658
Cost of goods      217,035           130,432           380,900           236,589     
sold
Gross profit        315,900             175,100             566,900             312,069
Total
operating          157,972           115,822           297,029           207,815     
expenses
Income from         157,928             59,278              269,871             104,254
operations
Interest            555                 (11         )       990                 660
expense, net
Foreign            (275        )      (3,236      )      (650        )      (1,729      )
currency gain
Income before
provision for       157,648             62,525              269,531             105,323
income taxes
Provision for      59,820            21,919            103,058           40,602      
income taxes
Net income          97,828              40,606              166,473             64,721
Net income
applicable to      -                 8,975             -                 14,173      
preference
shareholders
Net income
available for     $ 97,828           $ 31,631           $ 166,473          $ 50,548      
ordinary
shareholders
                                                                              
Weighted
average
ordinary
shares
outstanding:
Basic               194,323,935         146,555,601         193,557,194         143,554,974
Diluted             200,192,291         187,580,153         199,791,708         183,378,696
                                                                              
Net income
per ordinary
share ^ (1):
Basic             $ 0.50              $ 0.22              $ 0.86              $ 0.35
Diluted           $ 0.49              $ 0.22              $ 0.83              $ 0.35
                                                                              
Statements of
Comprehensive
Income:
Net income        $ 97,828            $ 40,606            $ 166,473           $ 64,721
Foreign
currency           4,744             (7,633      )      1,466             (5,654      )
translation
adjustments
Comprehensive     $ 102,572          $ 32,973           $ 167,939          $ 59,067      
income


^(1) The calculation for basic earnings per ordinary share is based on net
income available for ordinary shareholders divided by basic ordinary shares.
The calculation for diluted earnings per share is based on net income divided
by diluted shares.

                                                            
SCHEDULE 2

MICHAEL KORS HOLDINGS LIMITED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
                                                                   
                                    September      March 31,       October 1,
                                    29,
                Assets              2012           2012            2011
Current assets
Cash and cash                       $ 312,244      $ 106,354       $ 19,300
equivalents
Receivables,                          185,700        127,226         104,104
net
Inventories                           278,368        187,413         146,744
Deferred tax                          11,833         11,145          8,795
assets
Prepaid
expenses and                         99,163        31,925        26,449  
other current
assets
Total current assets                  887,308        464,063         305,392
Property and                          194,114        170,755         134,746
equipment, net
Intangible                            13,533         14,146          14,969
assets, net
Goodwill                              14,005         14,005          14,005
Deferred tax                          3,158          3,952           3,918
assets
Other assets                         7,366         7,504         6,186   
Total assets                        $ 1,119,484    $ 674,425      $ 479,216 
                                                                   
                Liabilities and
                Shareholders'
                Equity
Current
liabilities
Revolving line                      $ 11,616       $ 22,674        $ 16,218
of credit
Accounts                              87,410         67,326          66,179
payable
Accrued payroll
and payroll                           141,981        33,710          16,066
related
expenses
Accrued income                        3,801          8,199           4,653
taxes
Accrued
expenses and                         32,281        33,097        20,476  
other current
liabilities
Total current liabilities             277,089        165,006         123,592
Deferred rent                         49,583         43,292          37,539
Deferred tax                          8,872          6,300           11,352
liabilities
Other long-term                      5,962         3,590         4,440   
liabilities
Total liabilities                     341,506        218,188         176,923
Shareholders'
equity
Convertible preference shares,
no par value; no shares
authorized, issued and
outstanding
at September 29, 2012 and March
31, 2012 and 10,856,853 shares
authorized, issued and
outstanding at October 1, 2011.       -              -               -
Ordinary shares, no par value;
650,000,000 shares authorized,
and 199,746,220 shares issued
and outstanding at September
29, 2012 and 192,731,390 shares
issued and outstanding at
March 31, 2012 and 147,134,033
shares issued and outstanding         -              -               -
at October 1, 2011.
Additional                            382,123        228,321         157,906
paid-in capital
Accumulated other comprehensive       731            (735    )       (1,621  )
gain (loss)
Retained                             395,124       228,651       146,008 
earnings
Total shareholders' equity           777,978       456,237       302,293 
Total liabilities and               $ 1,119,484    $ 674,425      $ 479,216 
shareholders' equity
                                                                             

                                                                
Schedule 3

MICHAEL KORS HOLDINGS LIMITED AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION FOR NON-GAAP MEASURES– CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share and per share data)
(Unaudited)

Reconciliation of income from operations, as reported, to income from operations, as
adjusted
                                                                         
                 Three Months Ended                    Six Months Ended
                 September 29,     October 1,          September 29,     October 1,
                 2012              2011                2012              2011
                                                                         
Income from
operations,      $ 157,928         $ 59,278            $ 269,871         $ 104,254
as reported
Add back
adjustments
for one time
charges:
Employee
share option
redemption -      -                10,690            -                10,690      
private
placement
Income from
operations,      $ 157,928         $ 69,968           $ 269,871         $ 114,944     
as adjusted
                                                                         
                                                                         
Reconciliation of net income, as reported, to net income, as adjusted
                                                                         
                 Three Months Ended                    Six Months Ended
                 September 29,     October 1,          September 29,     October 1,
                 2012              2011                2012              2011
                                                                         
Net income,      $ 97,828          $ 40,606            $ 166,473         $ 64,721
as reported
Add back
adjustments
for one time
charges:
Employee
share option
redemption -       -                 10,690              -                 10,690
private
placement
Less tax
benefit on        -                (3,748      )      -                (4,121      )
above
Net income,      $ 97,828          $ 47,548           $ 166,473         $ 71,290      
as adjusted
                                                                         
Weighted
average
ordinary
shares
outstanding:
Diluted            200,192,291       187,580,153         199,791,708       183,378,696
                                                                         
Net income
per ordinary
share, as
adjusted:
Diluted          $ 0.49            $ 0.25              $ 0.83            $ 0.39
                                                                                       

Use of Non-GAAP Financial Measures

In addition to reporting financial results in accordance with generally
accepted accounting principles (GAAP), the Company provides non-GAAP operating
results that exclude certain charges or credits such as transaction expenses
related to the Company's IPO, Stock option expense and other offering fees.
These amounts are not in accordance with, or an alternative to, GAAP. The
Company's management believes that these measures provide investors with
transparency by helping illustrate the underlying financial and business
trends relating to the Company's results of operations and financial condition
and comparability between current and prior periods. Management uses the
measures to establish and monitor budgets and operational goals and to
evaluate the performance of the Company.

                                                          
SCHEDULE 4
MICHAEL KORS HOLDINGS LIMITED AND SUBSIDIARIES
CONSOLIDATED SEGMENT DATA
(In thousands)
(Unaudited)
                                                                    
                     Three Months Ended             Six Months Ended
                     September       October 1,     September       October 1,
                     29,                            29,
                     2012            2011           2012            2011
Revenue by
Region:
North America
(U.S. and            $  471,424      $  274,701     $  848,573      $  500,469
Canada)
Europe                  56,651          28,709         90,038          44,573
Other Regions          4,860          2,122         9,189          3,616
Total Revenue:       $  532,935      $  305,532     $  947,800      $  548,658
                                                                    
Revenue by
Segment:
Net sales:           $  242,280      $  133,431     $  457,284      $  255,775
Retail
Wholesale               270,785         154,494        453,151         264,432
Licensing              19,870         17,607        37,365         28,451
Total Revenue:       $  532,935      $  305,532     $  947,800      $  548,658
                                                                    
Income from
Operations:
Retail               $  68,436       $  25,625      $  128,315      $  53,547
Wholesale               77,399          21,511         118,117         32,379
Licensing              12,093         12,142        23,439         18,328
Total Income         $  157,928      $  59,278      $  269,871      $  104,254
from Operations
                                                                    
Income from
Operations, as
adjusted*:
Retail               $  68,436       $  28,381      $  128,315      $  56,303
Wholesale               77,399          28,707         118,117         39,575
Licensing              12,093         12,880        23,439         19,066
Total Income
from Operations,     $  157,928      $  69,968      $  269,871      $  114,944
as adjusted
                                                                    
*Adjusted results reflect one-time items shown in Schedule 3.

Contact:

Investor Relations:
ICR, Inc.
Jean Fontana, 203-682-8200
jean.fontana@icrinc.com
or
Media:
Michael Kors Holdings Limited
Lisa Pomerantz, 212-201-8128
lisa.pomerantz@michaelkors.com