TPR Tapestry Inc

By Suzanne Kapner and Allison Prang 

Tapestry Inc. said same-store sales at its Kate Spade brand declined 11% in the latest quarter, dragging down overall sales at the owner of Coach and other fashion labels.

Tapestry Chief Executive Victor Luis said Thursday Kate Spade's sales were hurt by a lack of new products from the previous design team. Overall, Kate Spade's sales fell 1% to $428 million.

Last week, the brand launched the first collection by new designer Nicola Glass, and Mr. Luis said early indications were positive.

Nevertheless, he said he expects weaker sales at the brand for the balance of the year as it clears out older merchandise.

Kate Spade's namesake founder, who was no longer involved with the company, died by suicide last year, which temporarily fueled sales as shoppers snapped up iconic pieces from the brand.

Tapestry's profit jumped more than four times to $254.8 million in the quarter ended Dec. 29, compared with $63.2 million for the prior-year period, helped by a lower tax rate and expenses.

Margins increased to 66.8% from 65.9% as the company sold more products at full price.

Comparable-store sales, which include stores open at least a year, at Coach rose 1%, a slowdown from prior quarters.

Net sales at the New York-based company climbed 0.9% to $1.8 billion.

Shares of Tapestry, formerly Coach, Inc., fell about 18% to $32.33 in morning trading.

Capri Holdings Ltd., the owner of the Michael Kors and Jimmy Choo brands that also recently bought Versace, reported Wednesday that sales were flat in its latest quarter from a year earlier. Profit also declined. Capri lowered its guidance for adjusted earnings for the fiscal year but raised its revenue estimate.

Write to Suzanne Kapner at Suzanne.Kapner@wsj.com and Allison Prang at allison.prang@wsj.com

(END) Dow Jones Newswires

February 07, 2019 11:25 ET (16:25 GMT)

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