The growth of coach’s store sales

The two quarter period, Coach brand revenue of $1 billion 230 million, $1 billion 200 million compared to the same period last year growth of 2%, which provide 100 basis points for the 3% business same store sales growth, Consensus Metrix expects same store sales growth of 2%; the brand’s two quarter gross margin of 68.8%, a 20 basis point decline over the previous year 69%, operating profit rate within the period of 29.4%, up 130 basis points significantly improved.

The resumption of growth in the same store sales and the slowdown in the gross interest rate decline have eased the market’s concerns, and also prove the end of a discount strategy in the early stage of the light luxury industry. However, the Tapestry, Inc. acquisition, and the lower end of the light luxury brand, Kate Spade, continues to be in the doldrums.

The results could be restored by the driver, Victor Luis Coach said North America, mall traffic and improve inventory correction as the main stimulus reasons, China continued to perform well, Hong Kong and Macao markets improved, only the strong euro and the high base last year to Europe especially England have tight performance.

Kate Spade brand by two quarter sales of $435 million, same store sales fell 7%, but still better than market expectations of 8.8% decline, mainly because the company contracted wholesale business and electricity supplier channels to enhance promotion cause, especially the negative effect of 4% Kate Spade business promotion with store sales.

Sales decline and aggravation promotion led Kate Spade gross profit margin to fall by 370 basis points to 59.4%, operating profit in the two quarter was 10.5% to 10.5%, and 21.2% in the two quarter of fiscal year 2017.

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