Tapestry sees a recovery in the first quarter and smiles. Three winning factors. First: the performance of Coach. Second: the booming sale in China. Third: the growth of the digital channel. All summed up, these factors brought the US group to beat the analysts’ estimates during the first 3 months of 2021 (as they correspond to the 3rd fiscal quarter), with a clearer and more optimistic view of the future.
Tapestry sees a recovery
“It’s important to note that, for the third consecutive quarter, we managed to increase operational income compared to both 2020 and 2019”, commented Joanne Crevoiserat, CEO of Tapestry. “We continue to become more optimistic regarding our capacity to generate sustainable growth. We see some encouraging signs pointing towards a recovery”.
The numbers
Tapestry’s third fiscal quarter, which closed on March 27th, 2021, closed with 1.27 billion USD in sales: +19%. Beyond analysts’ expectations of 1.22 billion (data from Refinitiv IBES and cited by Reuters). Net profits reached 92 million USD. The group that owns Coach, Kate Spade and Stuart Weitzman registered a 175% increase of sales in China compared to the previous comparable period and a +40% performance over 2019’s third quarter. Tapestry also highlights the “continuous momentum of its digital channel, up 3-digits compared the year before”.
The brands
Coach sold goods for 964 million USD (+25%) and “achieved revenue levels equal to pre-pandemic ones”. Kate Spade’s revenue was of 252 million, up 1% while Stuart Weitzman got to 57 million USD (+13%). During the first 9 months of the fiscal year (July 2020 – March 2021), Tapestry’s revenue was 4.13 billion USD, down 2.7% compared to the same period of the previous year. Forecasts expect revenue for this fiscal year to increase at “mid-teens rate”.
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