Coach, Inc (COH) has reported 8.62 percent rise in profit for the quarter ended Apr. 01, 2017. The company has earned $122.20 million, or $0.43 a share in the quarter, compared with $112.50 million, or $0.40 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $130.30 million, or $0.46 a share compared with $124.10 million or $0.44 a share, a year ago. Revenue during the quarter dropped 3.67 percent to $995.20 million from $1,033.10 million in the previous year period. Gross margin for the quarter expanded 189 basis points over the previous year period to 70.91 percent. Total expenses were 84.82 percent of quarterly revenues, down from 87 percent for the same period last year. This has led to an improvement of 218 basis points in operating margin to 15.18 percent.
Operating income for the quarter was $151.10 million, compared with $134.30 million in the previous year period.
However, the adjusted operating income for the quarter stood at $162 million compared to $151.80 million in the prior year period. At the same time, adjusted operating margin improved 158 basis points in the quarter to 16.28 percent from 14.69 percent in the last year period.
Victor Luis, Chief Executive Officer of Coach, Inc., said, “Our solid performance this quarter was very much in line with our expectations and our strategic initiatives. In a volatile and complex global environment, we delivered continued positive comparable store sales for the Coach brand in North America and gross margin expansion in each segment, while tightly controlling costs. We continued to drive growth in our directly-operated Europe and Mainland China businesses, which represent the most significant geographic opportunities for our brands. And, despite our deliberate pullback in the North America wholesale channel and the impact of calendar shifts, we delivered earnings growth. Importantly, we announced a new leadership structure and strengthened our Coach brand team, a critical step in Coach, Inc.’s evolution as a customer-focused, multi-brand organization.”
For financial year 2017, the company forecasts operating income to grow in the range of 18.50 percent to 19 percent.
Working capital increases sharply
Coach, Inc has recorded an increase in the working capital over the last year. It stood at $2,133.30 million as at Apr. 01, 2017, up 39.10 percent or $599.70 million from $1,533.60 million on Mar. 26, 2016. Current ratio was at 4.35 as on Apr. 01, 2017, up from 3.10 on Mar. 26, 2016. Cash conversion cycle (CCC) has decreased to 55 days for the quarter from 107 days for the last year period. Days sales outstanding went down to 23 days for the quarter compared with 25 days for the same period last year.
Days inventory outstanding has decreased to 75 days for the quarter compared with 128 days for the previous year period. At the same time, days payable outstanding went down to 44 days for the quarter from 46 for the same period last year.
Debt comes down significantly
Coach, Inc has recorded a decline in total debt over the last one year. It stood at $591.80 million as on Apr. 01, 2017, down 33.02 percent or $291.70 million from $883.50 million on Mar. 26, 2016. Total debt was 12.70 percent of total assets as on Apr. 01, 2017, compared with 18.89 percent on Mar. 26, 2016. Debt to equity ratio was at 0.20 as on Apr. 01, 2017, down from 0.34 as on Mar. 26, 2016. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
