'Preppy' Polo's profits surge

The equestrian look is back in this autumn, Polo hopes

Prestige clothing designer and retailer Polo Ralph Lauren reported a 22% increase in quarterly profits, boosted by rampant demand for high-margin luxury goods

Polo said its income for the first quarter of the fiscal year, ended 30 June, was $29.3m as expected, causing its shares to climb 9%.

The New York-based company also reaffirmed its earnings forecast for the full year and second quarter.

In the past year, Polo has speeded up its expansion into Europe, and narrowed its focus on the luxury, rather than mass-market products.

Luxury items have grown to account for half the merchandise in full-price Polo Ralph Lauren stores, up from 40% last year, the company said.

Horses for courses

The company feels confident about the outlook for the rest of the year.

Not all Ralph Lauren's clothes are horsey

Polo's "preppy" image fits in with this season's equestrian theme, President Roger Farah said in a conference call with analysts.

Polo specialises in high-fashion versions of casual and riding wear - a look that has so far proved more popular in the US market than in Europe.

But a shift in emphasis towards a more subdued look has played well with European consumers.

Sales growth was "in the double digits" in the European market.

Meanwhile, single-digit sales growth was recorded across all of the retail division, Polo said.

The company's shopping-mall-based Club Monaco stores, which have occasionally been a headache for the company in recent quarters, had single-digit same-store sales increases as the company invested to improve the design and fit of the products.