Ralph Lauren Corporation (NYSE:RL) affirmed its fiscal 2023 guidance while setting longer-term targets on Monday.
Per a press release, the company expects an annual revenue growth rate in the mid- to high-single digits through the 2025 fiscal year. Through that point, operating margin is expected to expand to at least 15%.
“Operating profit growth is expected to exceed the rate of top-line growth as a result of continued operating margin expansion,” the company statement read. “Operating margin is expected to expand to at least 15% by Fiscal 2025 in constant currency, driven by a combination of modest gross margin expansion and operating expense leverage balanced with continued investments in the Company’s long-term strategic priorities.”
Capital expenditures are expected to represent about 4% to 5% of revenue per annum through the same date.
“Since our last investor day in 2018, we have transformed our business – building a strong foundation with multiple engines of growth that are already showing momentum,” CEO Patrice Louvet said. “Our clear and choiceful strategies are expected to deliver sustainable long-term growth and value creation – fueled by our strong balance sheet and operating discipline – as we reinforce our position as a leading luxury lifestyle company.”
The details of these long-term strategies are due to be presented in an investor meeting to begin at 10:15AM ET. The event will be livestreamed.
In addition to margin expansion and sales growth aims, the company touted increased focus in shareholder return programs. Per the statement, the company plans to “return approximately $2B to shareholders on a cumulative basis through Fiscal 2025” via dividends and buybacks.
Read more on the company’s recent dividend declaration.