Coach and Kate Spade owner Tapestry Inc has announced its forecast for higher annual revenue and profit, surpassing market estimates. The luxury goods company expects an increase in demand for designer apparel and bags as social events resume and vaccination rates increase. This positive outlook aligns with the strong results seen by other high-end brands such as Ralph Lauren, Capri Holdings, LVMH, and Kering.
Despite the optimistic forecast, Tapestry, like many other industries, is facing challenges in its supply chain due to port congestions and global disruptions. These challenges have led to increased freight costs. However, Chief Financial Officer Scott Roe remains confident in the underlying strength of the business and its ability to navigate the uncertain macro environment.
Tapestry projects full-year revenue of approximately $6.4 billion, exceeding market estimates of $6.08 billion. It also expects annual profit per share to be in the range of $3.30 to $3.35, higher than the analysts’ average estimate of $3.19 per share. To reward its shareholders, the company plans to return over $750 million in fiscal year 2022 through dividend reinstatement and a share buyback program.
In the fourth quarter ending July 3, Tapestry reported a 126% increase in net sales to $1.62 billion, surpassing analysts’ average estimate of $1.56 billion. Excluding one-off items, the company achieved a profit of 74 cents per share, surpassing expectations of 69 cents per share.
Despite the positive news, Tapestry’s shares experienced a slight decline of 1.4% in morning trade, reflecting a broader market decline. However, the company’s shares have risen approximately 33% this year, indicating investor confidence in its future prospects.
As the luxury demand returns and the global economy continues to recover from the impact of the pandemic, Tapestry is well-positioned to capitalize on the rebound in sales of high-end handbags, shoes, and clothes. With its strong financial performance and strategic initiatives, the company is poised to navigate the challenges of supply chain disruptions and deliver value to its shareholders.
For more information on Tapestry Inc’s forecast and financial performance, visit:
– Reuters
– The Wall Street Journal
