Capri Holdings Focuses On Luxury Fashion, To Buy Alberto Gozzi
Zacks Investment Research | Dec 16, 2019 09:30PM ET
With a view to further cement its position in the global luxury market, Capri Holdings Limited (NYSE:CPRI) now plans to acquire Alberto Gozzi S.r.L., an Italian atelier and shoe manufacturer in Pistoia, Tuscany. The transaction is likely to be concluded in the fourth quarter of fiscal 2020.
Management is enthusiastic to welcome all Gozzi’s craftsmen to the Capri Holdings Group, who have been producing high-end shoes for many of the world’s top luxury brands over the years. In the near future, the factory will develop and produce shoes for Jimmy Choo and Versace. Later, it will add production of Michael Kors Collection shoes.
Capri Holdings has been steadily strengthening its position in the luxury fashion space, as evident from the acquisition of Jimmy Choo in 2017 that provided it additional avenues for international growth and a strong base in the luxury footwear category. The company also acquired the iconic Italian fashion brand, Versace, in 2018. These brands, along with Michael Kors, will help augment the company’s revenues to $8 billion in the long term.
Management intends to increase Versace’s revenues to $2 billion, while it plans to augment Michael Kors’ revenues to $5 billion in the long term. With respect to Jimmy Choo, management sees opportunity to boost sales to $1 billion. Additionally, it plans to increase Versace’s and Jimmy Choo’s store count to 300.
Capri Holdings has been progressing well on product innovation, brand engagement, fleet modernization, digital innovation and enhancement of customer experience. Also, the company’s focus on e-commerce platform bodes well. It has been constantly deploying resources to upgrade its information system and distribution infrastructure. For fiscal 2020, management anticipates total revenues to be approximately $5.8 billion.
Notably, shares of this Zacks Rank #3 (Hold) company have increased around 20% in the past three months, outperforming the Original post
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