In its trading report for the first quarter, Tapestry, Inc. said net sales totalled 1.17 billion dollars, representing a 14 percent decline beating analysts’ average estimate of 1.07 billion dollars, according to IBES data from Refinitiv. The company said in a statement that gross profit reached 830 million dollars, while gross margin was 70.8 percent, on a reported and non-GAAP basis compared to 919 million dollars with gross margin of 67.6 percent in the previous year. Net income for the quarter was 232 million dollars on a reported basis, with earnings per diluted share of 83 cents compared to 20 million dollars with earnings per diluted share of 7 cents in the prior year period, while on a non-GAAP basis, net income was 161 million dollars with earnings per diluted share of 58 cents compared to 114 million dollars with earnings per diluted share of 40 cents in the prior year period.
Commenting on the first quarter results, Joanne Crevoiserat, Chief Executive Officer of Tapestry, Inc., said: “We delivered strong profit growth across our portfolio of brands in the face of an unprecedented and challenging backdrop. We drove a meaningful sequential improvement in topline trends, supported by strength in digital and China. At the same time, we expanded gross margin by deliberately reducing promotional activity and raising AUR, while also tightly controlling SG&A expense. Taken together, we achieved a significant increase in EPS and generated positive free cash flow.”
Performance of core brands under Tapestry portfolio
The company added that net sales for Coach were 875 million, representing a decline of 9 percent, while gross profit totalled 645 million dollars and gross margin was 73.7 percent on a reported and non-GAAP basis compared to prior year gross profit of 678 million dollars on a reported and non-GAAP basis, while gross margin was 70.1 percent and 70.2 percent on a reported and non-GAAP basis, respectively.
Net sales for Kate Spade totalled 240 million dollars, representing a decline of 21 percent. The company said, gross profit for Kate Spade was 154 million dollars on both a reported basis and non-GAAP basis, while gross margin was 64.1 percent.
Net sales for Stuart Weitzman reached 56 million dollars compared to 87 million dollars in the same period of the prior year, representing a 35 percent decline, while gross profit totalled 31 million dollars on both a reported and non-GAAP basis, while gross margin for the quarter was 55.3 percent.
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