Coach Q1 sales increase 11 percentTuesday, 23 October 2012
Coach, a leading marketer of modern classic American accessories reported sales of 1.16 billion
dollars for its first fiscal quarter ended September 29, 2012, compared with 1.05 billion dollars reported in the same period of the prior year, with an increase of 11 percent. Net income for the quarter totalled 221 million dollars, with earnings per diluted share of 0.77 dollars. This compared to net income of 215 million dollars and earnings per share of 0.73 dollars in the prior year’s first quarter, representing increases of 3 percent and 6 percent, respectively.
Lew Frankfort, Chairman and Chief Executive Officer of Coach, Inc., said, “We were pleased with our results this quarter, highlighted by double-digit top line growth, with strong comparable stores sales – most notably in North America and China. We continued to make progress against our strategic initiatives - enhancing our leadership position in the North American women’s bag and accessory category through fashion innovation. By aggressively growing our international business, we also earned a leadership in the men’s accessories category. In addition, during the quarter, we completed the acquisition of our domestic distributors in Korea and Malaysia.”
For the quarter, operating income totalled 332 million dollars, up 3 percent from the 322 million dollars reported in the comparable year-ago period, while operating margin was 28.6 percent versus 30.7 percent reported for the prior year. As previously announced, long-term growth investments, notably in Asia, impacted profitability levels in the period. During the quarter, gross profit rose 11 percent to 845 million dollars from 765 million dollars a year ago.
During the first quarter of fiscal 2013 in North America, the company opened five factory stores, including three men’s factory stores increasing the total to 354 retail stores and 174 factory stores as of September 29, 2012. In China, eight net locations were opened, bringing the total to 104. Company added one men’s factory store to existing187 locations in Japan. At quarter-end, the company also operated seven locations in Singapore, 27 in Taiwan, 10 in Malaysia and 48 in Korea.