New York-based handbags-and-accessories maker Kate Spade & Co. today posted first-quarter 2016 earnings and sales that beat market watchers’ estimates and proved that momentum at the brand remains strong, analyst said.
The biggest Q1 story for the firm — which makes its own branded footwear and also collaborates with other brands, such as Keds — was a 19 percent year-over-year comp gain.
“Kate [Spade’s] comp is industry-leading,” Cowen and Co. analyst Oliver Chen wrote in a note today, dubbing the double-digit gain “impressive.”
The company reported net profit of $11.6 million, or 9 cents per diluted share, compared with a net loss of $55.2 million, or 42 cents per diluted share last year. Adjusted diluted earnings per share were 5 cents compared with diluted EPS of 1 cent in the prior year’s period. Analysts had predicted diluted EPS of 5 cents.
Reported sales advanced 7.5 percent to $274 million, while analysts had expected Q1 sales to total $271.22 million. Reported net sales for Kate Spade North America totaled $196 million while adjusted net sales in the region grew 17.1 percent to $219 million.
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“Our first-quarter results reflect the stronger, refocused Kate Spade & Co. and underscore the effectiveness of our differentiated strategy,” Kate Spade CEO Craig A. Leavitt said in a release. “We continue to focus on our powerful multi-channel approach, especially fueled by the robust performance of our global e-commerce business, which helped drive our industry-leading comparable sales growth of 19 percent.”
The company reaffirmed its 2016 full-year guidance — anticipating net sales of $1.385 billion and $1.410 billion and diluted EPS of 70 cents to 80 cents.
