Coach declares Q4 results on Aug 2

02 Aug '05

7 min read

New York based retailer Coach Inc, a leading marketer of modern classic American accessories, announced a 49 percent increase in earnings per diluted share for its fourth fiscal quarter ended July 2, 2005. This substantial increase in earnings from the prior year's fourth quarter reflected 24 percent growth in net sales combined with significant operating margin improvement. For the full fiscal year, net sales rose 29 percent and net income increased 48 percent versus the prior fiscal year.

The prior year's fourth fiscal quarter included an additional week and therefore, on a 13-week to 13-week basis, sales rose 31 percent and earnings per share rose 58 percent. Similarly, on a 52-week to 52-week basis, sales rose 31 percent for the fiscal year, while earnings per share rose 49 percent.

In addition, on July 1, 2005 the company completed the purchase of Sumitomo's 50 percent interest in Coach Japan, Inc for approximately $225 million plus undistributed profits and paid-in capital of about $75 million.

During the fourth quarter, net sales were $419 million, 24 percent higher than generated in the prior year's fourth quarter. Net income rose 49 percent to $98 million, or $0.25 per diluted share, compared with $66 million, or $0.17 per share in the prior year. This was ahead of the analysts' consensus estimate of $0.24 for the quarter. For the fiscal year 2005, net sales were $1.7 billion, up 29 percent from the $1.3 billion recorded in fiscal year 2004. Net income rose to $389 million, up 48 percent from the $262 million earned in the prior year. Diluted earnings per share rose 47 percent to $1.00, versus $0.68 a year ago, and ahead of analysts' estimates of $0.98. Earnings per share numbers have been adjusted for the two-for-one split, which was effected on April 4, 2005.

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