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Michael Kors to close stores, launches $1B share buyback plan

In the fiscal 2017 results it released May 31, Michael Kors Holdings Ltd. disclosed plans to close between 100 and 125 of its full-price retail stores over the next two years.

The luxury fashion company said it recorded impairment charges of $193.8 million in the fiscal fourth quarter of 2017 largely due to underperforming lifestyle stores.

It expects to incur about $100 million to $125 million of one-time costs from the store closures, but it also forecasts ongoing annual savings of $60 million from the store closures and the lower depreciation and amortization associated with the impairment charges.

The company's board on May 25 also authorized a $1 billion share repurchase plan, according to the earnings report. The share repurchases may be made in open market or privately negotiated transactions and are subject to market conditions, applicable legal requirements, trading restrictions under the company's insider trading policy, and other relevant factors. The program may also be suspended or discontinued at any time.

Michael Kors repurchased 6,641,815 of its ordinary shares for $250 million during the fourth quarter of fiscal 2017 and stated that as of April 1, it had fully utilized the previously authorized amount under the share buyback plan.