RH authorizes $700 mln stock repurchase program

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RH, formerly Restoration Hardware, ups guidance, reports mixed quarter

Shares of RH wavered between gains and losses in the extended session Tuesday after the retailer formerly known as Restoration Hardware presented mixed second-quarter results but raised its third- and fourth-quarter profit outlooks as well as its full-year 2018 profit outlook in an earnings report that quoted poet Robert Frost. RH said it earned $64 million, or $2.33 a share, in the second quarter, versus a loss of $8 million, or 28 cents a share, in the year-ago period. Adjusted for one-time items, RH earned $2.49 a share, compared with 65 cents a share a year ago. Revenue rose to $641 million from $615 million a year ago. Analysts polled by FactSet had expected adjusted earnings of $1.75 a share on sales of $661 million. “As a result of our strong second quarter earnings, we are raising our fiscal 2018 adjusted diluted earnings per share guidance for a third time,” the company said, to between $7.35 a share and $7.75 a share, up 15% from a previous guidance. Third- and fourth-quarter adjusted per-share earnings were also tweaked higher. In terms of revenue, the company said it sees “a clear path to $4 to $5 billion in North American revenues, as well as a significant international opportunity that could lead to RH becoming a $7 to $10 billion dollar global brand,” it said. “While most in our industry are closing or downsizing stores, we remain committed to our quest of revolutionizing physical retailing,” it said. “The road of endless promotions, free shipping, and a shrinking store base is resulting in broken and unsustainable retail models. We prefer the road less traveled by, and like Robert Frost, believe it will make all the difference.” RH shares ended the regular session down 4.9%.

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