Kate Spade Four Quarter Same Store Sales Increase Expectations

Kate Spade & Co., the US handbag and accessories manufacturer, today sold the four quarter holiday season in the US stock market earlier than expected, and the market outlook for the current fiscal year 2016 failed to meet expectations.

But the excellent performance and gratifying expectations of the same store made the Kate Spade & Co. rebounded by 4.1% before a sharp rise of 4.4%.

In the four quarter of January 2, 2016, Kate Spade & Co. achieved 14% of the same store sales growth, which was 11.4% higher than that of Consensus Metrix, but the net sales of $428 million 960 thousand was less than that of FactSet FactSet.

Net sales in North America rose by 13.6% to $371 million a year, while the international market fell by 13.3% to 52 million dollars, with an increase of 18.7% after adjustment.

The overall net sales of the group increased by 7.6% compared to the same period in fiscal 2014, excluding an increase of 13.9% after the end of the business and exchange rate.

Fourth quarter net operating profit plunged 51.4% to 61 million 500 thousand U.S. dollars over the same period, mainly because the net profit of the previous year included a tax base of 88 million dollars, resulting in a high base.

From $0.99 to $0.48.

Adjusted earnings per share were US $0.32, which was in line with the FactSet composite forecast.

Kate Spade & Co. predicts that the net sales in fiscal year 2016 will be between 13.85-14.10 billion and the US $1 billion 440 million forecast of FactSet forecast. It will also increase by 1 billion 242 million 700 thousand compared with net sales in fiscal 2015, up 9.1% from the same period last year.

The adjusted EPS is expected to be US $0.70-0.80, which means that it will substantially improve compared with us $0.48 in fiscal year 2015, but it is still lower than the FactSet forecast of US $0.82.

The gross profit margin of the fourth quarter group increased by 240 basis points, up from 57.8% in the same period of the previous year to 60.2%, and the profit margin of EBITDA profit increased by 350 basis points to 22.7% after adjusting the core profit.

Gross profit margin increased 100 basis points to 60.7% in the whole year, and the profit margin of EBITDA profit increased by 320 basis points to 16.1% after adjusting the core profit. The group's goal is to achieve the adjusted core profit EBITDA profit margin 18%-20% in the 2016 fiscal year.

Kate Spade & Co. announced today to enter the India market.

The group has signed a long-term distribution and retail licensing agreement with the Reliance Brands Ltd., a large agent retailer of Reliance Industries Group, India, and later this year, Reliance Brands Ltd. will launch an independent store network for Kate Spade Ltd. brand in India.

Reliance Brands Ltd. is a India partner of many well-known American brands such as Juicy Couture, BCBG Maxazria, Brooks Brothers, Kenneth Cole and Brothers.

In addition to geographical expansion

In addition to creating new growth in the context of the overall weakness, Kate Spade & Co. is also vigorously developing product categories.

In the earnings report, chief executive Craig A. Leavitt pointed out that the group introduced 14 new categories, including leisure sports wear, home decoration, desktop accessories and stationery, and entered 8 new markets last year.

In 2016, Craig A. Leavitt said that women's clothing, men's wear, children and household will become the four pillar businesses to promote group growth.

It is precisely because Kate Spade & Co. did not implement radical expansion.

The strategy, in the handbag market atrophy, the group avoided such as Coach Inc. NYSE:COH (NYSE:COH) Coach and Michael Kors Holdings Ltd. (NYSE:KORS), because the pition exposure diluted the hard built brand value and fell into recession, the two big competitors until the nearest improvement.

Kate Spade & Co., with its strong focus brand Kate Spade New York and unique design, has consolidated the foundation of loyal customers while maintaining a healthy sales growth through new media, new categories and new markets.

In the four quarter of fiscal year 2015, the Group recorded a growth in same store sales of 9%, 10%, 16% and 14%.

The group estimates that the same store sales growth will maintain a high level of 11%-16% this year, and the Reuters's composite forecast is 10.6%.

Kate Spade & Co., on Monday, closed at $19.82, an increase of 1.33% on the whole day, and has risen 11.5% since 2016. Meanwhile, the S & P 500 index recorded a 5.5% decline.

As of January 2nd, the group has 126 self operated independent stores, 52 authorized stores and 77 discount stores worldwide. The number of independent stores and discount stores in the North American market has increased, while the number of stores in the world is decreasing.

This year, the group plans to add 40-45 self operated and authorized stores. The upper and lower limit is 10 less than in 2015.