Apr 28, 2015
: weak North America sales weigh on handbag maker Coach
Apr 28, 2015
Handbag and accessories maker Coach Inc's quarterly sales fell short of estimates due to continued weak demand for its products in North America, its biggest market.
The Poppy handbag maker's shares were down 8.2 percent at $38.85 in premarket trading on Tuesday.
Sales in North America fell 24 percent to $493 million in the third quarter ended March 28, marking the seventh straight quarter of decline.
Same-store sales in the region fell 23 percent. Analysts polled by Consensus Metrix had forecast a decline of 21.5 percent.
Coach, which was founded in a Manhattan loft in 1941, has been focusing on Asia and Europe as it loses customers in North America to newer entrants Michael Kors Holdings Ltd and Kate Spade & Co.
But a weaker yen clipped sales in Japan and China sales grew at their slowest pace in eight quarters.
Net sales fell 15.5 percent to $929.3 million. Excluding the impact of foreign currency, sales rose 3 percent.
Coach's net income more than halved to $88.1 million, or 32 cents per share. Excluding items, the company earned 36 cents per share.
Analysts on average had expected earnings of 35 cents per share and revenue of $949.9 million, according to Thomson Reuters I/B/E/S.
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