Tapestry net sales increase 1 per cent in Q2 FY20

11 Feb '20
3 min read
Pic: Tapestry
Pic: Tapestry

Tapestry, a leading New York-based house of modern luxury accessories and lifestyle brands, posted 1 per cent growth to $1.82 billion in net sales in second quarter (Q2) FY20 that ended on December 28, 2019. Net sales stood at $3.1 billion for six months period in FY20. Gross profit in Q2 totaled $1.21 billion, while gross margin was 66.6 per cent. 
 
SG&A expenses totaled $847 million on a reported basis and represented 46.6 per cent of sales. Other income was $6 million. Net income for the quarter was $299 million on a reported basis compared to net income of $255 million in the prior year period.
 
Net sales for Coach increased 2 per cent to $1.27 billion in Q2 FY20 compared to the prior year period. Gross profit for Coach totaled $877 million, while gross margin was 69.1 per cent. 
 
SG&A expenses for Coach were approximately $494 million on a reported basis and represented 38.9 per cent of sales. Operating income for Coach totaled $383 million compared to reported operating income of $374 million in the prior year, while operating margin was 30.1 per cent versus 30 per cent a year ago.
 
Net sales for Kate Spade totaled $430 million for the fiscal second quarter as compared to $428 million in the prior year. Gross profit for Kate Spade totaled $262 million, while gross margin for the quarter was 61 per cent, on a reported and non-GAAP basis.
 
SG&A expenses for Kate Spade were approximately $194 million on a reported basis and represented 45.2 per cent of sales. Operating income for Kate Spade was $68 million on a reported basis, representing an operating margin of 15.8 per cent.
 
Net sales for Stuart Weitzman decreased 7 per cent to $116 million on a reported basis for Q2 FY20 compared to $124 million reported in the same period of the prior year. Gross profit for Stuart Weitzman totaled $70 million on a reported basis, while gross margin for the quarter was 60.5 per cent.
 
SG&A expenses for Stuart Weitzman were $60 million on a reported basis and represented 52.3 per cent of sales. Operating income for Stuart Weitzman was $10 million on a reported basis, while operating margin was 8.2 per cent. 
 
Company entered their third fiscal quarter with strong underlying trends, notably at Coach, as sales growth accelerated from the holiday period. Tapestry's fiscal outlook for FY20 now includes an estimated negative impact of the coronavirus outbreak in China of approximately $200-$250 million in sales. Therefore, the Company expects revenues for Fiscal 2020 to approximate $5.9 billion.

Fibre2Fashion News Desk (JL)

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