Tapestry sales are in-line with the expectations for the quarter
New York-based house of modern luxury accessories and lifestyle brands reported third quarter results for the period ended March 30, 2019. Victor Luis, Chief Executive Officer of Tapestry said the group is pleased with the third quarter performance.
Tapestry reported increases in sales for each of the luxury group’s three brands.
“Most notably, we again drove positive comps at Coach and generated a significant sequential comp improvement at Kate Spade with Nicola Glass’s new collection resonating with consumers globally. Further, we continued to make key investments across our portfolio and to realize meaningful synergies from the successful integration of Kate Spade as we harness the power of our multi-brand model,” said Chief Executive Officer of Tapestry.
Luis also announced the approval of a $1 billion share repurchase authorization, demonstrating Tapestry’s “confidence indriving long-term, sustainable growth and value.”
“Through this program we will optimize our capital deployment and enhance shareholder return, while maintaining ourfinancial and strategic flexibility,” further explained Luis.
“Importantly, we remain committed to our longstanding capital allocation priorities supported by our strong balance sheetand free cash flow: investing in our brands and business, pursuing strategic acquisitions on an opportunistic basis and maintaining our dividend,” added Tapestry CEO.
Net sales totaled $1.33 billion for the third fiscal quarter as compared to $1.32 billion in the prior year, an increase of 1%on a reported basis and 2% in constant currency.
Gross profit totaled $916 million on a reported basis, while gross margin for the quarter was 68.8% compared to $908million and 68.6%, respectively, in the prior year.
The Company expects revenues for fiscal 2019 to increase at a low-to-mid-single-digit rate from fiscal 2018.
In addition, the Company projects earnings per diluted share in the range of $2.55 to $2.60.
Coach Third Quarter of 2019 Results:
Net sales for Coach totaled $965 million for the third fiscal quarter, as compared to $969 million in the prior year on a reported basis, or an increase of 1% on a constant currency basis. Global comparable store sales increased 1%, including a benefit of approximately 100 basis points driven by an increase in global e-commerce.
Gross profit for Coach totaled $692 million, while gross margin was 71.7% on a reported and non-GAAP basis. This compared to reported gross profit and margin in the prior year of $691 million and 71.3%, respectively. On a non-GAAP basis, gross profit was $692 million, while gross margin was 71.4% in the prior year’s third quarter.