Coach, Inc. (NYSE:COH) Q1 2017 Earnings Conference Call - Final Transcript

Nov 01, 2016 • 08:30 am ET

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Coach, Inc. (NYSE:COH) Q1 2017 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, once again, and welcome to this Coach conference call. Today's call is being recorded. And at this time, for opening remarks and introductions, I'd like to turn the call over to the Senior Director of Investor Relations at Coach, Ms. Christina Colone.

Executive
Christina Colone

Good morning. Thank you for joining us. With me today to discuss our quarterly results are Victor Luis, Coach's Chief Executive Officer; and Andrea Shaw Resnick, Coach's Interim CFO. Andre Cohen, President, North America, is also joining us to discuss initiatives for the holiday season.

Before we begin, we must point out that this conference call will involve certain forward-looking statements. This includes projections for our business in the current or future quarters of fiscal years within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ in a material manner. Additional information about risks and another important factors that could cause results to differ from those in the forward-looking statements can be found in our latest Annual Report on Form 10-K and our other filings with the Securities and Exchange Commission.

Also, certain financial information will be presented on a non-GAAP basis. These non-GAAP measures exclude certain items related to our transformation plan, operational efficiency plan and Stuart Weitzman acquisition-related charges as well as the impact of foreign currency fluctuations, where noted. You may identify these non-GAAP measures by the terms, non-GAAP, constant currency, or excluding the negative impact of currency. You may find the corresponding GAAP measure as well as the related reconciliation on our website, www.coach.com/investors, and then viewing the earnings release posted today.

Now, let me outline the speakers and topics for this conference call. Victor Luis will provide an overall summary of our first fiscal quarter 2017 results and will also discuss our progress on global initiatives. Andre Cohen will speak to our North America business, product performance and review our key programs for the holiday season. Andrea Resnick will follow with details on financial and operational results for the quarter along with our outlook for FY 2017. After that, we will hold a question-and-answer session which will end shortly before 9:30. Victor will then conclude with some brief summary remarks.

I'd now like to introduce Victor Luis, Coach's CEO.

Executive
Victor Luis

Good morning. Thank you, Christina, and welcome, everyone. As noted in our press release, we are very pleased with our performance in the quarter, highlighted by continued positive comparable store sales in North America and growth internationally, including double-digit increases in Mainland China and Europe as well as sales gains in our directly operated businesses across Asia, outside of Greater China and Japan.

We remained focused on elevating the Coach brand through compelling product, differentiated store environments and emotional marketing. At the same time, we implemented the strategic actions necessary to reposition the brand and streamline our distribution in the promotional North American department store channel. Despite this deliberate pullback, we achieved growth across key financials, including sales, gross profit and operating income as well as double-digit