Stuart Weitzman Buy Helps Coach Earnings Beat

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Coach Inc reported better-than-expected profit and sales for the fourth quarter, helped by the acquisition of luxury shoe brand Stuart Weitzman Holdings LLC in May.

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Shares of the maker of Poppy handbags rose about 8 percent in premarket trading on Tuesday.

Coach, which is losing customers to newer entrants such as Michael Kors Holdings Ltd, Kate Spade & Co and Tory Burch LLC, is trying to revive sales by consolidating its stores and diversifying into other product categories.

Coach's North America same-store sales fell 19 percent in the fourth quarter. Analysts on average had expected a 20.8 percent drop, according to research firm Consensus Metrix.

The region accounts for more than half of the company's total sales.

Coach bought Stuart Weitzman from private equity firm Sycamore Partners in a deal valued at $574 million to expand its high-end offerings.

Net income declined to $11.7 million, or 4 cents per share, in the quarter ended June 27 from $75.2 million, or 27 cents per share, a year earlier.

Excluding items, the company earned 31 cents per share.

Revenue fell nearly 12 percent to $1 billion.

Analysts on average had expected a profit of 29 cents per share and revenue of $973 million, according to Thomson Reuters I/B/E/S.

Coach's shares were trading at $32.75 before the bell. Up to Monday's close, the stock had fallen 19 percent this year. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Kirti Pandey)

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