“Fiscal first quarter revenue was consistent with our expectations. Our business internationally was stronger than in North America where we managed continued industry headwinds. Further, adjusted operating income and earnings per diluted share were better than forecast, including favourable expense timing (...) Coach delivered its eighth consecutive quarter of positive comparable store sales growth led by digital and international channels. Comps in Europe, Japan and Mainland China were strong, offsetting weakness in Hong Kong, while North America was even with prior year. Kate Spade’s comparable store sales declined in line with expectations, reflecting the product and merchandising challenges we’ve previously identified, while Stuart Weitzman sales were negatively impacted by softer wholesale demand and continued operational challenges”, commented Jide Zeitlin, Chairman and Chief Executive Officer of Tapestry.

Tapestry's net sales totalled 1.36 billion US dollars for the fiscal first quarter as compared to 1.38 billion US dollars in the prior year, a decrease of 2% on a reported basis and 1% in constant currency. Net income for the quarter reached 20 million US dollars on a reported basis (compares to 122 million US dollars last year).

Net sales for Coach totaled 966 million US dollars in the fiscal first quarter, 1% above the prior year's period on a reported and constant currency basis. Global comparable store sales increased by 1%, including a benefit of approximately 100 basis points driven by an increase in global e-commerce. Gross profit for Coach totaled 678 million US dollars on a reported basis, while gross margin was 70.1%. Operating income for Coach totaled 200 million US dollars (235 million US dollars in 2018).

Net sales for Kate Spade totaled 306 million US dollars for the fiscal first quarter as compared to 325 million US dollars in the prior year, a decrease of 6% on both a reported and constant currency basis. Global comparable store sales declined by 16%, including the negative impact of approximately 200 basis points from global e-commerce. Gross profit for Kate Spade totaled 192 million US dollars on a reported basis, while gross margin for the quarter was 62.7%. Operating income for Kate Spade was a loss of 7 million US dollars on a reported basis (45 million US dollars in last year's similar period).

Net sales for Stuart Weitzman totaled 87 million US dollars for the fiscal first quarter compared to 95 million US dollars reported in the same period of the prior year, a decrease of 9% on a reported basis and 8% in constant currency. Gross profit for Stuart Weitzman totaled 45 million US dollars on a reported basis, while gross margin for the quarter was 52.5% as compared to 48 million US dollars and 50.2%, respectively, in the prior year. Operating income for Stuart Weitzman was a loss of 19 million US dollars on a reported basis.

Mr. Zeitlin concluded: “Our imperative is to fuel desire for our brands and make investment decisions through a consumer-centric lens (...) we have commenced an in-depth, comprehensive and efficient review of our business to address both near-term and long-term opportunities to drive organic growth and profitability across the portfolio. Importantly, we are maintaining our outlook for Fiscal 2020”.

Tapestry now expects revenue for fiscal 2020 to increase at a low-single-digit rate from fiscal 2019. In addition, the company projects earnings per diluted share to be approximately even with prior year.