Coach – COH – Strong double-digit sales and earnings gains
Coach, Inc. (NYSE: COH), a leading marketer of modern classic American accessories, today reported sales of $1.16 billion for its fourth fiscal quarter ended June 30, 2012, compared with $1.03 billion reported in the same period of the prior year, an increase of 12%. Net income for the quarter totaled $251 million, with earnings per diluted share of $0.86. This compared to net income of $202 million and earnings per diluted share of $0.68, in the prior year’s fourth quarter, increases of 24% and 27%, respectively.
For the fiscal year, net sales rose 15% to $4.76 billion from $4.16 billion the prior fiscal year while net income increased 18% to $1.04 billion from $881 million. In addition, diluted earnings per share rose 21% to $3.53 from $2.92.
Lew Frankfort, Chairman and Chief Executive Officer of Coach, Inc., said, “I’m pleased that we were able to once again achieve strong double-digit sales and earnings gains for our fiscal fourth quarter and full year. We made significant progress against our key initiatives – aggressively growing our international business, becoming a market leader in the Men’s accessories category and harnessing the power of the digital world. In FY12, we accelerated the acquisition of key Asian domestic distributors and grew our distribution rapidly in emerging luxury markets such as China.”
“During the fourth quarter our international sales remained robust, driven by both distribution and productivity increases. In North America, however, an increasingly promotional environment led to lower growth than expected in factory stores. As a result, we responded by reinstating our prior practice of in-store couponing in a cross section of factory locations late in the period. It’s important to note that we have significant pricing flexibility and a variety of marketing levers available in this channel, which allow us to balance productivity gains and margin improvement.”
For the quarter, operating income totaled $371 million on a non-GAAP basis, 19% above the $312 million reported in the year-ago period, while operating margin was 32.1% versus 30.3%. During the quarter, gross profit rose 13% to $838 million from $741 million reported a year ago, while gross margin was 72.6% versus 71.8%. SG&A expenses, as a percentage of net sales, totaled 40.5%, compared to the 41.5% reported in the year-ago quarter. During the quarter, COH recorded certain items including a favorable tax settlement. As a result, COH made charitable contributions which precisely offset the benefit of the tax settlement to net income and earnings per share. Therefore, on a GAAP basis, operating income for the fourth quarter was $352 million with a 30.4% margin and the SG&A expense ratio was 42.1%.
About Coach – COH
Coach (COH), with headquarters in New York, is a leading American marketer of fine accessories and gifts for women and men, including handbags, men’s bags, women’s and men’s small leathergoods, weekend and travel accessories, footwear, watches, outerwear, scarves, sunwear, fragrance, jewelry and related accessories.
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NEW YORK–(BUSINESS WIRE)–Jul. 31, 2012—
Coach, Inc. (NYSE: COH), a leading marketer of modern classic American accessories, today reported sales of $1.16 billion for its fourth fiscal quarter ended June 30, 2012, compared with $1.03 billion reported in the same period of the prior year, an increase of 12%. Net income for the quarter totaled $251 million, with earnings per diluted share of $0.86. This compared to net income of $202 million and earnings per diluted share of $0.68, in the prior year’s fourth quarter, increases of 24% and 27%, respectively. For the fiscal year, net sales rose 15% to $4.76 billion from $4.16 billion the prior fiscal year while net income increased 18% to $1.04 billion from $881 million. In addition, diluted earnings per share rose 21% to $3.53 from $2.92. Lew Frankfort, Chairman and Chief Executive Officer of Coach, Inc., said, “I’m pleased that we were able to once again achieve strong double-digit sales and earnings gains for our fiscal fourth quarter and full year. We made significant progress against our key initiatives – aggressively growing our international business, becoming a market leader in the Men’s accessories category and harnessing the power of the digital world. In FY12, we accelerated the acquisition of key Asian domestic distributors and grew our distribution rapidly in emerging luxury markets such as China.” “During the fourth quarter our international sales remained robust, driven by both distribution and productivity increases. In North America, however, an increasingly promotional environment led to lower growth than expected in factory stores. As a result, we responded by reinstating our prior practice of in-store couponing in a cross section of factory locations late in the period. It’s important to note that we have significant pricing flexibility and a variety of marketing levers available in this channel, which allow us to balance productivity gains and margin improvement.” For the quarter, operating income totaled $371 million on a non-GAAP basis, 19% above the $312 million reported in the year-ago period, while operating margin was 32.1% versus 30.3%. During the quarter, gross profit rose 13% to $838 million from $741 million reported a year ago, while gross margin was 72.6% versus 71.8%. SG&A expenses, as a percentage of net sales, totaled 40.5%, compared to the 41.5% reported in the year-ago quarter. During the quarter, COH recorded certain items including a favorable tax settlement. As a result, COH made charitable contributions which precisely offset the benefit of the tax settlement to net income and earnings per share. Therefore, on a GAAP basis, operating income for the fourth quarter was $352 million with a 30.4% margin and the SG&A expense ratio was 42.1%. |
About Coach – COH
Coach (COH), with headquarters in New York, is a leading American marketer of fine accessories and gifts for women and men, including handbags, men’s bags, women’s and men’s small leathergoods, weekend and travel accessories, footwear, watches, outerwear, scarves, sunwear, fragrance, jewelry and related accessories.
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
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