New York-based design house Coach has reported third quarter results for the period ended March 26, 2016.
Net sales totaled $1.03 billion for the third fiscal quarter, compared with $929 million reported in the same period of the prior year, an increase of 11 percent. Gross profit totaled $713 million versus $665 million a year ago on both a non-GAAP and reported basis, an increase of 7 percent, while gross margin was 69 percent versus 71.6 percent. Operating income for the quarter on a non-GAAP basis totaled $152 million compared to $146 million in the prior year, while operating margin was 14.7 percent versus 15.8 percent Net income for the quarter on a non-GAAP basis totaled $124 million, with earnings per diluted share of $0.44, compared to non-GAAP net income in the third quarter of FY15 of $100 million with earnings per diluted share of $0.36.
In addition, the Company today announced a series of operational efficiency initiatives focused on creating an agile and scalable business model, as well as numerous changes to its leadership team, Andre Cohen is being promoted to President, North America and Global Marketing, adding North America Wholesale as well as Global Marketing, Customer Experience and Digital to his responsibilities. Todd Kahn is being promoted to President, Chief Administrative Officer and Secretary and will expand his scope to include Information Technology, Supply Chain, Global Environments and Procurement. With these changes, Gebhard Rainer, President and Chief Operating Officer and David Duplantis, President, Global Marketing, Digital & Customer Experience will be leaving the company.
“We are very pleased with our third quarter performance, highlighted by a return to growth for the Coach brand, driving overall operating profit growth,” said Victor Luis, CEO of Coach, Inc. “Our performance was in line with expectations and reflected the consistent execution of the transformation initiatives put into place nearly two years ago, in spite of volatile tourist spending flows, as well as macroeconomic and promotional headwinds. Both our retail and outlet stores in North America sequentially improved from the holiday quarter and e-commerce was an overall contributor as well”