=Coach (COH) reported earnings on Tue 15 Aug 17 (b/o)

Coach beats by $0.01, misses on revs; guides FY18 EPS below consensus, revs below consensus

• Reports Q4 (Jun) earnings of $0.50 per share, $0.01 better than the Capital IQ Consensus of $0.49; revenues fell 1.8% year/year to $1.13 bln vs the $1.15 bln Capital IQ Consensus. North America Q2 comparable store sales rose approximately 4%
• Co issues downside guidance for FY18, sees EPS of $2.35-2.40 vs. $2.50 Capital IQ Consensus Estimate; sees FY18 revs of $5.8-5.9 bln vs. $6.04 bln Capital IQ Consensus Estimate.
• Co guidance included low-to-mid- single digit accretion from the acquisition of Kate Spade, consistent with the previously communicated forecast.
• In addition, the company is projecting operating income growth of 22% to 25% versus fiscal 2017 driven by mid-single digit organic growth, the acquisition of Kate Spade, and estimated synergies of $30-$35 million. These synergies are expected to offset in part the reduction in profitability from the strategic and deliberate pullback of Kate Spade wholesale disposition and online flash sales channels. Taken together, the Kate Spade business and resulting synergies are expected to contribute approximately $130-$140 million to operating income.