Coach Shares Fall In Premarket After Company Offers Soft Outlook

By Ciara LinnaneMarketWatch Pulse

Coach Inc. shares fell nearly 5% in premarket trade Tuesday, after the luxury accessories maker reported better-than-expected profit and sales for its fiscal fourth quarter but offered a cautious outlook for the coming year. Coach said it had net income of $12 million, or 4 cents a share, in the quarter, compared with $75 million, or 27 cents a share, in the year-earlier period. Excluding restructuring and acquisition costs, per-share earnings came to 31 cents, topping the FactSet consensus of 29 cents. Sales fell to $1.00 billion from $1.14 billion but were ahead of the FactSet consensus of $973 million. "As we moved through Fiscal 2015, we drove sequential improvement in our North America bricks and mortar business while dramatically reducing the number of promotional impressions in the marketplace against a backdrop of heightened promotional activity," Chief Executive Victor Luis said in a statement. The company's international businesses achieved "moderate growth" on a constant currency basis, driven by Europe and China, he said. Coach is now expecting fiscal 2016 standalone brand revenues to rise in the low-single digits on a constant currency basis. Foreign currency is expected to shave about 200 basis points off fiscal 2016 revenue growth. Shares have fallen 19% in the year so far, while the S&P 500 has gained about 2%.

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