Idol says fiscal 2018 will be “a transition year” for establishing a new baseline before returning to growth. “We have a strong brand, led by Michael Kors, with a history of fashion innovation and leadership, a global footprint with stores positioned in the best locations around the world and the marketing expertise to effectively convey our fashion stories,” he says.

LONDON—Michael Kors Holdings Ltd. said Wednesday it plans to close 100 to 125 of its 827 stores over the next two years as total revenue and same-store sales both posted double-digit annual declines for the most recent quarter. An even bigger year-over-year drop was reported for the fashion brand's wholesale business, conducted mainly with department stores. Shares of the London-based company were down about 8% on the New York Stock Exchange as of mid-morning Wednesday.

Total revenue for the three-month period ending April 1 was down 11.2% to $1.06 billion, while same-store sales slipped 14.1% although on a net basis retail sales were up 0.5% from the year-ago period, due mainly to the opening of 159 new stores. Wholesale business was off 22.8% Y-O-Y. The company's net loss was $26.8 million, or 17 cents per share, for the fourth quarter of fiscal 2017, compared with net income of $177 million, or 98 cents per share, a year earlier.

The company said Wednesday it expects to incur approximately $100 million to $125 million of one-time costs associated with store closures. Ultimately, the closings are expected to save the company an average of $60 million per year.

Chairman and CEO John D. Idol doesn't mince words in spelling out the current state of affairs for Michael Kors. “Fiscal '17 was a challenging year, as we continued to operate in a difficult retail environment with elevated promotional levels,” he says. “In addition, our product and store experience did not sufficiently engage and excite consumers. We acknowledge that we need to take further steps to elevate the level of fashion innovation in our accessories assortments and enhance our store experience in order to deepen consumer desire and demand for our products.”

Idol says fiscal 2018 will be “a transition year” for establishing a new baseline before returning to growth. “We have a strong brand, led by Michael Kors, with a history of fashion innovation and leadership, a global footprint with stores positioned in the best locations around the world and the marketing expertise to effectively convey our fashion stories,” he says.