Coach 2012 Annual Report Download - page 32

FISCAL 2012 COMPARED TO FISCAL 2011
The following table summarizes results of operations for fiscal 2012 compared to fiscal 2011:
Fiscal Year Ended
June 30, 2012 July 2, 2011 Variance
(dollars in millions, except per share data)
Amount
%of
net sales Amount
%of
net sales Amount %
Net sales ......... $4,763.2 100.0% $4,158.5 100.0% $604.7 14.5%
Gross profit ....... 3,466.1 72.8 3,023.5 72.7 442.6 14.6
Selling, general and
administrative
expenses ........ 1,954.1 41.0 1,718.6 41.3 235.5 13.7
Operating income . . . 1,512.0 31.7 1,304.9 31.4 207.1 15.9
Provision for income
taxes .......... 466.8 9.8 420.4 10.1 46.4 11.0
Net income ....... 1,038.9 21.8 880.8 21.2 158.1 17.9
Net Income per share:
Basic .......... $ 3.60 $ 2.99 $ 0.61 20.5%
Diluted ......... 3.53 2.92 0.61 20.9
Net Sales
The following table presents net sales by operating segment for fiscal 2012 compared to fiscal 2011:
Fiscal Year Ended
Net Sales
Percentage of
Total Net Sales
June 30,
2012
July 2,
2011
Rate of
Change
June 30,
2012
July 2,
2011
(dollars in millions) (FY12 vs. FY11)
Direct-to-Consumer ......... $4,231.7 $3,646.4 16.1% 88.8% 87.7%
Indirect ................. 531.5 512.1 3.8 11.2 12.3
Total net sales ............. $4,763.2 $4,158.5 14.5 100.0% 100.0%
Direct-to-Consumer — Net sales increased 16.1% to $4.23 billion during fiscal 2012 from $3.65 billion
during fiscal 2011, driven by sales increases in our Company-operated stores in North America and China.
Comparable store sales measure sales performance at stores that have been open for at least 12 months,
and includes sales from coach.com. Coach excludes new locations from the comparable store base for the first
year of operation. Similarly, stores that are expanded by 15% or more are also excluded from the comparable
store base until the first anniversary of their reopening. Stores that are closed for renovations are removed
from the comparable store base.
In North America, net sales increased 12.7% driven by sales from new and expanded stores and by a
6.6% increase in comparable store sales. During fiscal 2012, Coach opened 9 net new retail stores and 26 new
factory stores, and expanded 10 factory stores in North America. In Japan, net sales increased 11.7% driven
by an approximately $40.1 million, or 5.3%, positive impact from foreign currency exchange. During fiscal
2012, Coach opened 11 net new locations and expanded three locations in Japan. Coach China results
continued to be strong with double-digit percentage growth in comparable store sales. During fiscal 2012,
Coach opened 30 net new stores in Hong Kong and mainland China.
Indirect — Net sales increased 3.8% to $531.5 million from $512.1 million in fiscal 2011. The increase
was driven primarily by a 7.9% increase in Coach International Wholesale net revenue, partially offset by a
1.6% decrease in U.S. Wholesale net revenue. Licensing revenue of approximately $28.5 million and
$24.7 million in fiscal 2012 and fiscal 2011, respectively, is included in Indirect sales.
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