Tapestry sales go up (+33%), still investors look cautious owing to Spade and Weitzman uncertainty

Tapestry achieve their goals, but Kate Spade comparable sales drop (-9%) and Stuart Weitzman prospective uncertainty make investors wary. In the third financial quarter (January-March 2018) the US group’s sales increased by 33%, mostly thanks to the buyout of Kate Spade. As for Coach revenues, which are worth 73% of the overall business turnover, they went up by 6% (the comparable ones grew by 3%); in contrast, Kate Spade comparable sales decreased by 9%, while Stuart Weitzman improved their results (+5%), still causing an operating loss. In the first nine months of the business, from July 2017 to March 2018, Tapestry’s earnings increased by 31%, therefore going up to 3,633 billion euros. The group expect their revenues to keep growing by 30% in order to reach around 4,876 billion euros, in terms of global turnover, at the end of the financial year. Profits will supposedly go up by 20% compared to the year before. CEO Victor Luis pointed out that the average accomplishments achieved by Stuart Weitzman have been negatively affected by some delays in production along with reduced sales of some traditional articles. As regards Kate Spade, analysts believe that incomes dropped because of the lowering of promotional and discount sales, alongside the withdrawal of items from some big stores that were dealing with difficulties. The company implemented such strategies aiming to enhance the brand exclusivity.


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