Companies

Tapestry raises full year earnings guidance

Feb 12, 2024 United States

The owner of Coach, Kate Spade and Stuart Weitzman has raised its earnings guidance for fiscal 2024 after posting better-than-expected revenue and profit growth in the second quarter

“Our second quarter results exceeded expectations, highlighting the power of brand building and disciplined execution. During the key holiday season, our passionate teams delivered for our customers, fueling brand magic through innovative product, engaging storytelling, and operational excellence. Importantly, we drove record revenue and EPS, while advancing our strategic agenda. Based on these results, we are raising our EPS outlook for the fiscal year”, commented Joanne Crevoiserat, Chief Executive Officer of Tapestry.

Second Quarter Results

In the three months to the 30^th of December, Tapestry’s net sales reached 2.08 billion US dollars, representing growth of 3% on both a reported and a constant currency basis, on a comparable basis to the second quarter of fiscal 2023.

Coach, with second quarter net sales of 1.54 billion US dollars (up by 6% on a reported basis and by 7% on a constant currency basis year-over-year), was the main driver of the group’s overall performance.

On the other hand, in this period, Kate Spade’s net sales totalled 460.4 million US dollars, down by 6% year-over-year on both a reported and a constant currency basis, and Stuart Weitzman’s net sales amounted to 82.2 million US dollars, down by 4% year-over-year on a reported basis and by 3% year-over-year on a constant currency basis.

In the second quarter of fiscal 2024, Tapestry’s gross profit was 1.49 billion US dollars, while its gross margin was 71.6%, as compared to a gross profit of 1.39 billion euros and gross margin of 68.6% recorded in a similar period of the prior fiscal year. This improvement reflects “a benefit of 170 basis points from lower freight expense, as well as operational improvements”.

The group’s second quarter net income totalled 322 million US dollars, or earnings per diluted share of 1.39 US dollars, on a comparable basis to a net income of 330 million US dollars, or earnings per diluted share of 1.36 US dollars, posted in the same period of fiscal 2023.

Fiscal 2024 Outlook

Tapestry expects to reach approximately 6.7 billion US dollars in revenue in the current fiscal year, an increase of about 1% on a reported basis and 2% on a constant currency basis, as compared to the previous fiscal year. It also anticipates earnings per diluted share in the range of 4.20 US dollars to 4.25 US dollars, reflecting a growth of 8% to 9% on a comparable basis to fiscal 2023.

The company also reported that it continues to make incremental progress towards completing the acquisition of Capri Holdings.

Image Credits: fashionista.com

United States Coach Kate Spade Quarter Results Results Stuart Weitzman Tapestry