The company’s CEO said:
During the holiday quarter, total sales fell slightly in constant currency as weakness in our North American women’s bag and accessories business offset strong growth in Men’s, footwear, and robust results in emerging Asian markets and Europe. We continued to be disappointed by our performance in North America, which was impacted by substantially lower traffic in our stores and by our decision to limit access to our e-factory flash sales site. At the same time, China results remained resilient with total sales growing about 25% and comparable store sales rising at a double digit rate.
Total North American sales decreased 9% year over year to $983 million, with same-store sales down 13.6%. International sales increased 2% to $425 million, including a 25% gain in China.
The gross margin in the holiday quarter came in at 69.2%, down from 72.2% reported in the same period a year ago.
Putting on a brave face, the CEO added:
We remain confident in our brand vision, our leadership team and our ability to execute the strategy underway. We look forward to sharing our strategic plan to drive brand vibrancy and long-term value creation during our analyst day in early June.
Coach did not offer any guidance. The consensus estimates for the third quarter so far call for EPS of $0.76 on revenues of $1.20 billion. For the full fiscal year, EPS is estimated at $3.46 and revenues at $5.1 billion.
Shares were down more than 7% in premarket trading Wednesday, at $48.55 in a 52-week range of $45.87 to $60.12. Thomson Reuters had a consensus analyst price target of around $58.11 before the results were announced.
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