Coach parent Tapestry group released its fourth quarter and year-round results, and its performance exceeded market expectations. The group said its core brand Coach plans to significantly increase its advertising spending in the increasingly important Greater China market as a result of increased demand for handbags from Kate Spade and an accelerated recovery in Coch’s performance.
According to data released by Tapestry Group, sales in the fourth quarter were $1.483 billion, up 30.9% year-on-year; annual sales were $5.88 billion, up 31.1% year-on-year; and net income in the fourth quarter was $212 million, up 39.5% year-on-year. Full-year net income was affected by one-time costs such as the acquisition of Kate Spade, which fell 32.7% to $397 million year-on-year.
Victor Luis, chief executive of Tapestry Group, said in a post-earnings conference call that the growth in performance during the period was mainly due to increased demand for Kate Spade handbags and an accelerated recovery in Coch’s performance.