Jimmy Choo interim profits treble ahead of takeover

Luxury shoemaker Jimmy Choo, which is being bought by US retailer Michael Kors, yesterday said its pre-tax profit for the half year almost tripled, helped by its retail and licensing businesses.

Pre-tax profit for the six months to the end of June amounted to £18.1m (€19m), compared to £6.6m last year. Revenue for the period rose 4.5% to £201.6m.

Michael Kors agreed two months ago to buy Jimmy Choo for $1.2bn, snapping up the British company whose towering stilettos have been made famous by celebrity customers from Princess Diana to Kendall Jenner.

Jimmy Choo chairman Peter Harf said the deal opened up exciting opportunities.

“The shared vision and distinctive appeal of these two iconic brands will provide an exciting platform to achieve global leadership in luxury retail,” Harf said in a statement.

Revenue at the company’s Japan unit rose 11%, at constant currency levels, helped by continued growth in its men’s section.

Excluding Japan, the company’s Asia businesses expanded 8.2% at constant currency, driven by strong demand for seasonal fashion offerings.

Shares in the company were up about 0.2% on the London stockmarket, trading close to the 230p offer price.

Founded by bespoke shoemaker Jimmy Choo in the 1990s, the company makes three-quarters of its revenue from selling shoes and has about 150 company-operated retail stores around the world.

Its strong performance stands in contrast to Kors, which has lost 65% of its market value since 2014 due to fierce competition and a drop in customers at department stores.

Jimmy Choo will help Kors expand its footwear portfolio to 17% of total sales from 11%, Mr Kors said on a conference call recently.

The shoemaker has the potential of raking in $1bn (€840m) in sales annually as it opens more stores in Asia, especially China, Kors chief executive John Idol said at the time of the takeover announcement.

Jimmy Choo put itself up for sale in April after its majority-owner JAB, the investment vehicle of Germany’s billionaire Reimann family, signalled its intention to focus on consumer goods instead.

- Reuters