Going forward, Coach plans to sell its higher-priced 1941 bag line in all its stores, switch from 12 deliveries per year to eight to better align with the fashion calendar and restructure its wholesale business, Fashionista reported.
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Net sales amounted to $1.15 billion during the period, a year-over-year increase of 15% on both a reported and constant-currency basis. Sales in the Greater China region grew 5% in US dollars and 10% in constant currency, while Japan delivered a 7% increase in U.S dollar sales and a 5% decline in constant-currency revenue during the quarter. Meanwhile, department stores remain a threat to the accessible luxury-handbag category, as the brand can not control the promotions that department stores choose to execute. Revenue rose just 0.2% to $987.90 million. This is because the company witnessed double digits growth in Mainland China and Europe.
Mr. Luis was pleased with the worldwide business’ performance, which was underscored by double-digit growth in Mainland China and Europe, along with sales gains in directly-operated businesses in Southeast Asia.
It’s a problem for Coach, Michael Kors and other affordable luxury brands. It also acquired Stuart Weitzman for this goal, which has also resulted in better performance, with a gross profit increment by 10% to $737 million.
Coach is actively working to improve brand perception and pricing power.
The Stuart Weitzman brand – which named a new CEO and brand president last month and new creative director on Tuesday – brought in net sales of $84 million in the fourth quarter. The handbag maker said revenue for fiscal 2017 will increase at a low-to-mid-single-digit percentage rate, and earnings per share will grow at a double-digit pace.
Investors evaluating COH stock at the current market price of $41.45/share should know the company will next release quarterly results for the June 2016 quarter.
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“Overall, we believe in the department store channel and believe it’s a great place for consumers to come in and cross shop – but, we believe most in protecting and focusing our investments in the long-term health of the brand”, he said. The firm sees positive margin expansions and comps growth in the following quarters. Five equities research analysts have rated the stock with a hold rating and eleven have issued a buy rating to the company. For the reporting quarter, equity analysts expect the stock to deliver $0.41 in earnings per share (EPS).
