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Inside Coach’s Fiscal 4Q17 Top-Line Performance

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Coach’s fiscal 4Q17 top line

For fiscal 4Q17, Coach (COH) reported total revenues of $1.13 billion, which is 1.8% lower than its revenues in fiscal 4Q16. The top-line numbers fell considerably short of the Wall Street expectation of $1.51 billion.

The sales decline of 60 basis points was due to Coach’s strategic decision of door closures and fewer promotional days in North America. The calendar-related shift also impacted the top line. Excluding the additional week in the fourth quarter of 2016, sales improved 6% on a reported basis.

Coach reported a 4% increase in its North America comps (comparable same-store sales), compared with the expectation of a 3.6% rise.

Victor Luis, CEO (chief executive officer) of Coach, noted: “Our strong fourth quarter results—in which we achieved mid-single-digit North America comparable store sales for the Coach brand and drove solid growth at Stuart Weitzman—capped an excellent fiscal 2017 performance.”

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Fiscal 2017 performance

For fiscal 2017, Coach’s top line stood flat at just under $4.5 billion. Excluding the 53rd week from its fiscal 2016 results, net sales were up 2%. Strategic decisions negatively impacted sales growth by ~150 basis points, and Coach missed its top-line expectations in three of the four quarters.

By comparison, handbag rival Michael Kors (KORS) reported a 4.6% YoY (year-over-year) decline in its fiscal 2017 sales, totaling just under $4.5 billion. The company exceeded the Street’s expectations in three of the quarters.

Investors looking to invest in Coach through ETFs can choose the iShares Morningstar Mid-Cap Value ETF (JKI). Coach has a weight of ~0.77% in JKI.

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