STAGGERING 3RD QUARTER FOR COACH
Byline: Vicki M. Young
NEW YORK — Citing customer loyalty and the success of recent product launches, Coach on Monday posted increases in third-quarter and nine-months results.
For the quarter ended March 31, the company reported that income rose 163 percent to $8 million, or 18 cents a diluted share, versus $3 million, or 9 cents, in the year-ago quarter. The latest quarterly results included a $200,000 after-tax positive adjustment related to the reorganization charges taken in the first quarter. Excluding the adjustment, income was up 156 percent to $7.8 million, or 17 cents. Analysts’ consensus estimates were for 11 cents a share. Sales were up 13 percent to $130.6 million, compared with $115.1 million in the comparable year-ago quarter.
Sales in the quarter for the direct-to-consumer channel, consisting primarily at Coach stores, rose 16 percent to $77 million from $66.4 million a year ago. Comparable store sales rose 3.7 percent, consisting of a 2.7 percent increase in Coach retail stores and a 4.6 percent rise at the factory stores. Wholesale sales were up 10 percent to $53.6 million from $48.7 million.
Lew Frankfort, chairman and chief executive officer, said in a statement that the firm’s successful Signature line will be extended from solely handbags, women’s accessories and shoes “to include new materials and additional categories in seasons to come.
“Looking ahead, we’re optimistic about the prospects for the fourth fiscal quarter,” he continued. “Mother’s Day, Father’s Day and graduation each represent strong sales occasions for Coach.”
For the nine months, income rose 64 percent to $54.8 million, or $1.32 a diluted share, versus $33.3 million, or 95 cents, in the same year-ago period. Excluding the impact of a first-quarter reorganization charge related to a shuttered plant in Florida, income would have been up 73 percent. Sales rose 12 percent to $479.3 million from a year-ago’s $427.2 million. The increase was driven by strong gains in the international division along with double-digit increases in comps to Japanese consumers worldwide, Coach said.
Coach, formerly a wholly owned subsidiary of Sara Lee Corp., went public in October. Before earnings were released, shares closed Monday at $24, up 41 cents, in New York Stock Exchange trading.