Coach 2002 Annual Report Download - page 25

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Table of Contents
warehousing and management employees at the Medley facility. These actions reduced costs by the resulting transfer of production to lower
cost third-party manufacturers.
In April 2002, Coach ceased production at the Lares, Puerto Rico, manufacturing facility. This reorganization involved the termination of
394 manufacturing, warehousing and management employees at the Lares facility. These actions reduced costs by the resulting transfer of
production to lower cost third-party manufacturers.
Coach’s fiscal year ends on the Saturday closest to June 30.
Results Of Operations
The following is a discussion of the results of operations for fiscal 2003 compared to fiscal 2002, and fiscal 2002 compared to fiscal 2001
along with a discussion of the changes in financial condition during fiscal 2003.
Net sales by business segment for fiscal 2003 compared to fiscal 2002 and fiscal 2001 are as follows:
Fiscal Year Ended Percentage of Total Net Sales
June 28, June 29, June 30, June 28, June 29, June 30,
2003 2002 2001 Rate of Increase 2003 2002 2001
(dollars in millions) (’03 v. ’02) (’02 v. ’01)
Direct $559.5 $447.1 $391.8 25.1% 14.1% 58.7% 62.1% 65.2%
Indirect 393.7 272.3 208.7 44.6 30.5 41.3 37.9 34.8
Total net sales $953.2 $719.4 $600.5 32.5% 19.8% 100.0% 100.0% 100.0%
Consolidated statements of income for fiscal 2003 compared to fiscal 2002 and fiscal 2001 are as follows:
Fiscal Year Ended
June 28, 2003 June 29, 2002 June 30, 2001
$% of net sales $% of net sales $% of net sales
(dollars and shares in millions, except for earnings per share)
Net sales $949.4 99.6% $716.5 99.6% $598.3 99.6%
Licensing revenue 3.8 0.4 2.9 0.4 2.2 0.4
Total net sales 953.2 100.0 719.4 100.0 600.5 100.0
Cost of sales 275.8 28.9 236.0 32.8 218.5 36.4
Gross profit 677.4 71.1 483.4 67.2 382.0 63.6
Selling, general and administrative
expenses 433.7 45.5 346.4 48.1 275.7 45.9
Reorganization costs — 0.0 3.4 0.5 4.6 0.8
Operating income 243.7 25.6 133.6 18.6 101.7 16.9
Interest (income) expense, net (1.1) (0.1) 0.3 0.1 2.3 0.4
Income before provision for income
taxes and minority interest 244.8 25.7 133.3 18.5 99.4 16.6
Provision for income taxes 90.6 9.5 47.3 6.6 35.4 5.8
Minority interest, net of tax 7.6 0.8 0.2 0.0 — 0.0
Net income $146.6 15.4% $85.8 11.9% $64.0 10.7%
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