The accessories company on Thursday increased its second-half forecast because of strong spring season results that are trending above plan.
Coach anticipates that for the second half, earnings will be at least 85 cents a diluted share, up 2 cents from previous guidance. In the same period a year ago, the company posted earnings of 64 cents. Coach estimated sales for the period of at least $800 million.
The company also updated full-year fiscal 2005 forecasts, projecting sales of more than $1.67 billion and earnings per share of at least $1.89. Overall, the fiscal 2005 guidance is for a 27 percent increase in sales and a 39 percent increase in EPS compared with the year-ago period. In the U.S., the company is anticipating same-store sales gains of at least 10 percent for the second half of the year. In Japan, Coach’s other major market, the company expects a 27 percent increase in sales in constant currency with at least mid-single-digit sales growth.
The third-quarter expectation is at least $400 million in sales and EPS of 43 cents, while the projection for fourth-quarter sales is at least $400 million, with an EPS expected at 42 cents.
Chairman and chief executive officer Lew Frankfort, in a statement, cited positive consumer response to the new Dot group of gallery totes and accessories, which sold well in January; the popularity of the company’s Valentine’s Day handbags and accessories and the new styles and colors in the firm’s Soho and Hamptons Leather collections.
In the Hamptons Weekend line, the company added choices in its nylon collection and variations of its Signature pattern, aimed at enhancing its casual market. In the Soho line, it updated its twill collection. Later in the spring, Coach will offer its bags and accessories in novelty materials such as straw and metallic.
Coach will report third-quarter results on April 26. Shares of Coach closed Thursday at $59.37, up 3.7 percent, in trading on the New York Stock Exchange.
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