Tapestry (TPR) Tops Q1 EPS by 39c, Revenues Beat
Tapestry (NYSE: TPR) reported Q1 EPS of $0.58, $0.39 better than the analyst estimate of $0.19. Revenue for the quarter came in at $1.17 billion versus the consensus estimate of $1.04 billion.
Tapestry, Inc. Fiscal First Quarter 2021 Highlights
- Delivered top and bottom line results materially ahead of expectations
- Achieved sequential improvement in revenue trends across all brands
- Drove a second consecutive quarter of triple-digit e-commerce growth versus prior year, while simultaneously improving global store sales trends
- Posted double-digit year-over-year revenue growth in Mainland China
- Significantly expanded gross margins by over 300 basis points driven in part by lower, more disciplined promotional activity
- Realized substantial decline in SG&A of 27% on a reported basis and 20% on a non-GAAP basis, reflecting effective expense management and previously announced actions to transform the Company’s operating model, including a 20% reduction in Tapestry’s run-rate corporate headcount costs
- Increased operating margin by over 700 basis points on a GAAP and non-GAAP basis
- Tightly managed inventories, which declined 8% from prior year and are well-positioned heading into the holiday quarter
- Generated positive free cash flow of $64 million as compared to an outflow of $66 million in the prior year
- Ended the quarter with $1.5 billion in cash and equivalents
Joanne Crevoiserat, Chief Executive Officer of Tapestry, Inc., said, “We are very pleased with our first quarter results, which exceeded expectations and demonstrated the bold actions we are implementing as part of our Acceleration Program. We delivered strong profit growth across our portfolio of brands in the face of an unprecedented and challenging backdrop. We drove a meaningful sequential improvement in topline trends, supported by strength in Digital and China. At the same time, we expanded gross margin by deliberately reducing promotional activity and raising AUR, while also tightly controlling SG&A expense. Taken together, we achieved a significant increase in EPS and generated positive free cash flow.”
Ms. Crevoiserat continued, “Our performance underscores the power of our brands, the agility of our talented teams and the competitive advantage of Tapestry’s enabling platform. Importantly, it also reinforces the potential of our Acceleration Program. Guided by an unwavering focus on the consumer and supported by new ways of working, we are positioning the Company to successfully navigate the dynamic environment and drive long-term, sustainable growth.”
For earnings history and earnings-related data on Tapestry (TPR) click here.