Tapestry,Inc。,(TPR) 首席执行官 Victor Luis 在 2019年 第四季度业绩 - 收益电话会议记录

Tapestry, Inc., (NYSE:TPR) Q4 2019 Earnings Conference Call August 15, 2019 8:30 AM ET

Tapestry,Inc。,(纽约证券交易所代码:[TPR])2019年第四季度收益电话会议2019年8月15日美国东部时间上午8:30

公司参与者

Christina Colone - Vice President, Investor Relations
Victor Luis - Chief Executive Officer
Andrea Shaw Resnick - Global Head, Investor Relations and Corporate Communications
Todd Kahn - President and Chief Administrative Officer and Chief Legal Officer
Josh Schulman - Chief Executive Officer and Brand President, Coach
Joanne Crevoiserat - Chief Financial Officer

  • Christina Colone - 投资者关系副总裁
  • Victor Luis - 首席执行官
  • Andrea Shaw Resnick - 投资者关系和企业传播全球主管
  • Todd Kahn - 总裁兼首席行政官兼首席法律官
  • Josh Schulman - Coach首席执行官兼品牌总裁
  • Joanne Crevoiserat - 首席财务官

电话会议参与者

Bob Drbul - Guggenheim Securities
Irwin Boruchow - Wells Fargo
Erinn Murphy - Piper Jaffray
Alex Walvis - Goldman Sachs
Oliver Chen - Cowen & Company
Mark Altschwager - Baird
Jamie Merriman - Bernstein

  • Bob Drbul - 古根海姆证券
  • Irwin Boruchow - 富国银行
  • Erinn Murphy - Piper Jaffray
  • 亚历克斯沃尔维斯 - 高盛
  • Oliver Chen - Cowen&Company
  • Mark Altschwager - 贝尔德
  • 杰米梅里曼 - 伯恩斯坦

会议主持员

Good day and welcome to the Tapestry Conference Call. Today’s call is being recorded. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions] At this time, for opening remarks and introductions, I would like to turn the call over to Christina Colone, Vice President, Investor Relations.

美好的一天,欢迎参加Tapestry电话会议。 今天的电话正在录音。 发言者发言后,将会有一个问答环节。 [操作员说明]此时,为了开场致辞和介绍,我想转达投资者关系副总裁Christina Colone的电话。

Christina Colone

Good morning and thank you for joining us. With me today to discuss our quarterly and annual results are Victor Luis, Tapestry’s Chief Executive Officer and Andrea Shaw Resnick, Tapestry’s Global Head of Investor Relations and Corporate Communications.
Before we begin, we must point out that this conference call will involve certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, including projections for our business in the current or future quarters or fiscal years. Forward-looking statements are not guarantees and our actual results may differ materially from those expressed or implied in the forward-looking statements. Please refer to our Annual Report on Form 10-K, the press release we issued this morning and our other filings with the Securities and Exchange Commission for a complete list of risks and important factors that could impact our future results and performance. Non-GAAP financial measures are included in our comments today and in our presentation slides. You may find the corresponding GAAP financial information as well as the related reconciliations on our website www.tapestry.com/investors and then viewing the earnings release and the presentation slides posted today.
Now, let me outline the speakers and topics for this conference call. Victor will provide an overview of our fourth quarter and full year 2019 results for Tapestry as well as our three brands. Andrea will continue with details on the financial and operational results and our outlook for FY ‘20. Following that, we will hold a question-and-answer session, where we will be joined by Todd Kahn Tapestry’s President and Chief Administrative Officer and Chief Legal Officer; Josh Schulman, CEO and Brand President of Coach; and Joanne Crevoiserat, Tapestry’s recently appointed CFO. Following Q&A, we will conclude with some brief summary remarks.
I would now like to turn it over to Victor Luis, Tapestry’s CEO.

早上好,谢谢你加入我们。今天与我讨论我们的季度和年度业绩是Tapestry首席执行官Victor Luis和Tapestry全球投资者关系和企业传播负责人Andrea Shaw Resnick。

在我们开始之前,我们必须指出,本次电话会议将涉及“私人证券诉讼改革法案”界定的某些前瞻性陈述,包括对我们当前或未来季度或财政年度业务的预测。前瞻性陈述不是保证,我们的实际结果可能与前瞻性陈述中明示或暗示的内容存在重大差异。请参阅我们的10-K表年度报告,我们今天上午发布的新闻稿以及我们向美国证券交易委员会提交的其他文件,以获取可能影响我们未来业绩和业绩的风险和重要因素的完整清单。非GAAP财务指标包含在我们今天的评论和演示幻灯片中。您可以在我们的网站www.tapestry.com/investors上找到相应的GAAP财务信息以及相关的对账,然后查看今天发布的收入发布和演示幻灯片。

现在,让我概述本次电话会议的发言人和主题。 Victor将概述Tapestry以及我们的三个品牌的第四季度和2019年全年业绩。 Andrea将继续详细介绍财务和运营业绩以及我们对20财年的展望。在此之后,我们将举行问答环节,Todd Kahn Tapestry的总裁兼首席行政官兼首席法律官将与我们一起参加;教练的首席执行官兼品牌总裁Josh Schulman;和Tapestry最近任命的首席财务官Joanne Crevoiserat。在问答后,我们将以一些简短的总结性发言结束。

我现在想把它交给Tapestry首席执行官Victor Luis。

Victor Luis

Good morning. Thank you, Christina and welcome everyone. As noted in our press release, 2019 was a year of meaningful evolution for Tapestry. Importantly, we made significant progress on our strategic initiatives against a difficult retail backdrop in North America.
Touching on results by brand, we achieved solid and consistent performance at Coach, which speaks to the success of our transformation strategy, driving brand health and vibrancy. For the year, Coach’s international and digital channels led, while the brand also outperformed its direct competition in North America. Coach’s performance is key for two important reasons. First, Coach is the core of Tapestry. We understand that driving sustainable growth at Coach is essential to the success of our company overall. Therefore, we are incredibly proud of the brand’s results in spite of the volatile backdrop. Second, this performance reinforces our strategic intent to diversify our acquired brands across geographies and channels.
Turning to Stuart Weitzman, we made advancements across product, people and processes, returning the business to top line growth. The SW team remains focused on driving improved profitability in the year ahead. At Kate Spade, we launched a new creative vision for the brand. And while there have been some green shoots, we clearly need more time to drive an inflection to positive comps, especially given the brand’s exposure to the competitive and traffic challenged North America market. We acknowledge that there are opportunities and are addressing those areas with a sense of urgency.
As we look ahead, we are revising our outlook for FY ‘20 to reflect the current trends in our business, notably at Kate Spade. We believe this is prudent, particularly in light of the uncertain environment in North America and while we build the brand’s awareness in global markets. Importantly, with continued momentum at the Coach brand, our priority is to fuel an acceleration in our acquired businesses to unlock the power of our multi-brand platform. Therefore, while our long-term vision is unchanged, we are modifying our capital allocation policy in fiscal 2020 dedicating our resources to driving organic growth and do not expect to pursue strategic acquisitions. We are focused on balancing the investment in our brands to drive growth with the return to capital, with the return of capital to shareholders. To this end, we plan to increase the capital we return to shareholders, repurchasing approximately $300 million of common stock, while maintaining our annual dividend, resulting in the total payout of nearly $700 million. Overall, we remain steadfast in our vision and are focused on maximizing the benefits of our global multi-brand platform.
Now, turning to our FY ‘19 milestones and FY ‘20 priorities across our strategic pillars. First, we made significant progress in reinforcing the foundation of our distinctive multi-brand platform in fiscal 2019. We generated the anticipated synergies from the integration of Kate Spade into our portfolio, which funded in part our key strategic initiatives. To this point, we made material investments in Tapestry’s infrastructure implementing Phases 1 and 2 of our ERP system in FY ‘19 with the third and final phase just launched last week, all without business interruption. We could not be proud of our teams for their diligence and hard work throughout this multiyear projects. We launched comprehensive 2025 corporate responsibility goals, recognizing our role as a leader in our industry to effect change and solidifying our commitment to social responsibility. These goals are consistent with the values led culture that we are building. And we brought in key new Tapestry leaders, Noam Paransky, Chief Digital Officer; Tom Glaser COO, and most recently, Joanne Crevoiserat as our CFO to help set and execute our strategic agenda.

早上好。谢谢Christina,欢迎大家。正如我们的新闻稿所述,2019年是Tapestry有意义的发展之年。重要的是,我们在针对北美困难零售背景的战略举措方面取得了重大进展。

通过品牌的成果,我们在Coach取得了稳固而稳定的业绩,这说明了我们的转型战略的成功,推动了品牌健康和活力。今年,Coach的国际和数字渠道领先,而该品牌的表现也优于其在北美的直接竞争。教练的表现是两个重要原因的关键。首先,Coach是Tapestry的核心。我们知道,推动Coach的可持续发展对我们公司的整体成功至关重要。因此,尽管背景不稳定,我们仍然对该品牌的成果感到非常自豪。其次,这种表现强化了我们的战略意图,即跨地域和渠道使我们收购的品牌多元化。

谈到Stuart Weitzman,我们在产品,人员和流程方面取得了进步,使业务回归收入增长。 SW团队仍然专注于提高未来一年的盈利能力。在Kate Spade,我们为该品牌推出了新的创意愿景。虽然有一些绿色的枝条,但我们显然需要更多的时间来推动积极的变化,特别是考虑到该品牌面临竞争和交通挑战的北美市场。我们承认有机会并以紧迫感解决这些问题。

展望未来,我们正在修订我们对20财年的展望,以反映我们业务的当前趋势,特别是在Kate Spade。我们认为这是谨慎的,特别是考虑到北美环境的不确定性以及我们在全球市场中建立品牌意识。重要的是,随着Coach品牌的持续发展,我们的首要任务是推动我们收购业务的加速,以释放我们多品牌平台的力量。因此,虽然我们的长期愿景没有改变,但我们正在修改2020财年的资本配置政策,将我们的资源用于推动有机增长,而不期望进行战略性收购。我们专注于平衡我们品牌的投资,以通过资本回报推动增长,并将资本回报给股东。为此,我们计划增加我们返还给股东的资本,回购约3亿美元的普通股,同时维持我们的年度股息,导致总支出接近7亿美元。总体而言,我们始终坚持我们的愿景,并致力于最大限度地发挥我们全球多品牌平台的优势。

现在,转向我们的FY '19里程碑和我们的战略支柱中的'20财年优先事项。首先,我们在2019财年巩固了我们独特的多品牌平台的基础上取得了重大进展。我们通过将Kate Spade整合到我们的投资组合中产生了预期的协同效应,这些投资组合部分资助了我们的关键战略计划。到目前为止,我们在2009财年实施了对Tapestry基础设施的实质性投资,实施了我们ERP系统的第1阶段和第2阶段,上周刚刚启动了第三阶段和最后阶段,所有这些都没有中断业务。在这个多年的项目中,我们不能为我们的团队的勤奋和辛勤工作感到自豪。我们启动了全面的2025年企业责任目标,认可我们作为行业领导者的角色,以实现变革并巩固我们对社会责任的承诺。这些目标与我们正在建立的价值主导文化相一致。我们带来了重要的新Tapestry领导者,Noam Paransky,首席数字官; Tom Glaser首席运营官,最近,Joanne Crevoiserat作为我们的首席财务官,帮助制定和执行我们的战略议程。

Looking ahead to FY ‘20, we are focused on leveraging the investments we have made in our platform. Specifically, our investments in our ERP system will help to drive standardization across the organization. In addition, we are excited to benefit from Tom Glaser’s unique and deep operational experience in multi-brand, multi category fashion supply chains. One of our key initiatives led by Tom will be to identify opportunities to improve our demand to production planning cycle, while increasing our speed to market across categories. This is especially important as we accelerate product innovation and the number of customization programs within our brands. It will also be important as we bring the Kate Spade footwear business in-house in the second half of the fiscal year, which I will touch on shortly.
Next, driving global growth, in FY ‘19, we expanded our international presence through both distributor acquisitions and new store openings in key regions. This allows us to directly control and drive our business internationally capitalizing on our scale and market knowledge across brands. Importantly, we also gained traction with Chinese consumers globally, which as of FY ‘19 represented a high-teens percentage of Tapestry sales and where we see tremendous opportunity for growth. Throughout the year, we drove awareness for our brands with targeted events and marketing campaigns featuring locally relevant influencers, first for Kate Spade and Stuart Weitzman. And perhaps the most significant highlight of FY ‘19 was Coach’s first ever runway show in Shanghai, which garnered 1.6 billion impressions.
Turning to FY ‘20, capturing growth with the Chinese consumers for all brands remains a key strategic initiative. Our focus will be creating seamless and innovative experiences both offline and online as we continue to translate each of our brand’s key messages into locally relevant content, which takes us to digital and data labs where we are building the skills and capabilities that truly differentiate us from the competitive set. During the fiscal year, we officially launched Tapestry’s Data Labs portal, a personalized suite of data science and AI tools that are changing the way we use and interact with data, providing access to those on the frontlines of our business.
As mentioned, we recently welcomed Noam Paransky as our new Chief Digital Officer to lead our company-wide digital innovation agenda. He will play a key role as our enterprise leader to deliver innovative omni-channel experiences across all our customer digital touchpoints. His objective is to create a scalable Tapestry global digital ecosystem, comprised of people, process and technology to enable global teams to act locally with greater agility and at greater velocity. Noam has hit the ground running. We are excited to announce the launch of China Next, an agenda focused on the China market. Adding fuel to our digital leadership on Sina Weibo and WeChat, this initiative connects two of Tapestry’s key strategic priorities, driving digital innovation and growing our business with Chinese consumers. And not only are we focused on driving local engagement, we expect our China Next digital innovation agenda to provide learnings that we can leverage on a global scale.

展望20财年,我们专注于利用我们在平台上进行的投资。具体而言,我们对ERP系统的投资将有助于推动整个组织的标准化。此外,我们很高兴能从Tom Glaser在多品牌,多品类时尚供应链中独特而深入的运营经验中受益。汤姆领导的关键举措之一将是确定改善我们对生产计划周期的需求的机会,同时提高我们跨类别的市场速度。这一点尤其重要,因为我们加快了产品创新和品牌内定制计划的数量。这一点也很重要,因为我们将在本财年下半年将Kate Spade鞋业务纳入内部,我将很快介绍。

接下来,在19财年推动全球增长,我们通过分销商收购和关键地区的新店开张扩大了我们的国际业务。这使我们能够利用各品牌的规模和市场知识直接控制和推动我们的国际业务。重要的是,我们也吸引了全球的中国消费者,截至2009财年,我们在Tapestry的销售额中占据了很高的比例,并且我们看到了巨大的增长机会。在整个一年中,我们通过针对当地相关影响者的有针对性的活动和营销活动提升了我们品牌的知名度,首先是Kate Spade和Stuart Weitzman。也许19世纪财年最重要的亮点是Coach在上海举办的第一场时装秀,获得了16亿印象。

转向20财年,中国消费者对所有品牌的增长仍然是一项重要的战略举措。我们的重点是在离线和在线创建无缝和创新的体验,因为我们继续将每个品牌的关键信息转化为本地相关内容,这将我们带到数字和数据实验室,我们正在建立真正使我们与众不同的技能和能力。竞争对手。在本财政年度,我们正式启动了Tapestry的数据实验室门户网站,这是一套个性化的数据科学和人工智能工具套件,它们改变了我们使用数据和与数据交互的方式,提供了访问业务前沿的人员。

如上所述,我们最近欢迎Noam Paransky担任我们新的首席数字官,领导我们公司范围内的数字创新议程。他将作为我们的企业领导者发挥关键作用,为我们所有客户的数字接触点提供创新的全渠道体验。他的目标是创建一个可扩展的Tapestry全球数字生态系统,由人员,流程和技术组成,使全球团队能够以更高的灵活性和更快的速度在本地采取行动。诺姆已经开始运作了。我们很高兴地宣布推出China Next,这是一个专注于中国市场的议程。通过新浪微博和微信为我们的数字领导增添动力,该计划将Tapestry的两个关键战略重点与推动数字创新和与中国消费者发展业务联系起来。我们不仅专注于推动本地参与,我们还希望我们的中国下一代数字创新议程能够提供我们可以在全球范围内利用的知识。

Overall, driving advancements in digital and Data Labs will be an important area of focus in FY ‘20 and we look forward to updating you on our progress in the quarters ahead. And finally, brand innovation, nothing is more important than this. As a brand-led and consumer-centric company, our goal is to nurture authentic innovative brands to capture the opportunities within the attractive and growing premium bags and small leather goods footwear and outerwear categories. We estimate that these combined categories totaled $95 billion and grew at a high single-digit rate on an organic basis in FY ‘19. This growth was led by bags and accessories which topped an estimated $50 billion and grew at an estimated high single-digit rate in FY ‘19 or a mid to high single-digit rate in U.S. dollars given the appreciation of the dollar for both the fourth quarter and the year.
With that, I will move into our performance by brand starting with Coach. Global comparable store sales rose 2% in the fourth quarter led by outperformance in our international channels and across our e-commerce platforms consistent with the previous quarter. The drivers of our positive global brick-and-mortar comparable store sales were conversion, reflecting our strong product offering as well as traffic. This was Coach’s seventh consecutive quarter of comp store sales growth. By region, we delivered overall positive comps across all of our international regions, including Europe, other Asia, Greater China and Japan. Our international wholesale business also rose on a POS basis in the quarter. Comps in North America was flat to the prior year, accelerating sequentially, including the positive impact of the shift in timing of Easter, along with the negative impact of continued pressure from lowest tourist spend as well as ongoing volatility in Daigou or reseller activity. In addition, our North America wholesale shipments were above prior year and our business at POS increased despite a lower level of promotional event days. We are particularly proud of the brand’s sequential improvement in North America in light of the weekend traffic trends in both outlet and full-priced retail malls. We believe this speaks to the vibrancy of the brand, which is outperforming its direct accessible luxury peers fueled by innovation across channels and products, marketing and in-store experience.
Looking at our progress against the brand strategies for FY ‘19, we drove leather goods innovation across the pyramid of fashion, occasion and price. In retail, our Signature assortment comp-to-comp reflecting the continued demand for this most proprietary brand icon, while in outlet we benefited from our good, better, best strategy in our core women’s handbag business. We fueled brand momentum and sales through collaborations, drops and pop-ups, including Disney, ex-Coach and most recently, a Rexy Remix, a collaboration with Chinese artists, which was featured on the runway of our Shanghai Fashion Show. During the year, we had over 130 pop-ups, engaging with our customers in a new way. We gained traction on lifestyle categories, including footwear and ready-to-wear, while growing our men’s business to almost $900 million at POS. These initiatives were supported by compelling marketing campaigns, which balanced our position as a fashion authority, while broadening our messages. We launched Michael B. Jordan as the first global ambassador of Coach men’s and post innovative culturally relevant and disruptive messages throughout the year. We also drove e-commerce growth and digital innovation globally as we continue to enhance our omni-channel capabilities. Overall, we saw strong double-digit increases in the brand’s followers on Instagram, WeChat and Weibo.

总体而言,数字实验室和数据实验室的推动将成为20财年的重点关注领域,我们期待着为您提供有关我们未来几个季度进展的信息。最后,品牌创新,没有什么比这更重要了。作为一家以品牌为主导和以消费者为中心的公司,我们的目标是培育真正的创新品牌,以抓住有吸引力且不断增长的优质包袋和小型皮具鞋类和外衣类别中的机会。我们估计这些组合类别总计950亿美元,并且在19财年以有机为基础以高单位数增长率增长。这一增长主要受到包装袋和配件的推动,估计价值500亿美元,并且在19财年达到了估计的高单位数增长率,或者以美元升值为中等至高单位数美元。季度和年份。

有了这个,我将从Coach开始逐步进入我们的表演。由于我们的国际渠道以及与上一季度一致的电子商务平台表现优异,第四季度全球可比店面销售额增长2%。我们积极的全球实体店可比销售额的驱动因素是转换,反映了我们强大的产品供应和交通。这是Coach连续第七个季度的复合店销售增长。按地区划分,我们在包括欧洲,其他亚洲,大中华区和日本在内的所有国际区域提供了整体正面评价。本季度我们的国际批发业务也以POS为基础上涨。北美的比率与去年相比持平,加速顺序,包括复活节时间转变的积极影响,以及来自最低旅游支出的持续压力以及代购或经销商活动持续波动的负面影响。此外,尽管促销活动天数较低,但我们的北美批发货运量均高于去年,我们的POS业务增长。鉴于周末和零售商场的周末交通趋势,我们对该品牌在北美的连续改进感到特别自豪。我们相信这说明了该品牌的活力,该品牌在渠道和产品创新,营销和店内体验方面的表现优于其直接接触的奢侈品牌。

看看我们在2009财年的品牌战略取得的进展,我们在时尚,场合和价格的金字塔中推动皮革制品创新。在零售方面,我们的Signature品种组合反映了对这个最具专有品牌图标的持续需求,而在我们的核心女装手袋业务中,我们受益于我们的优秀,更好,最佳策略。我们通过合作,投放和弹出式推动品牌发展和销售,包括迪士尼,前教练以及最近与中国艺术家合作的Rexy Remix,这是我们在上海时装秀的秀场上展出的。在这一年中,我们有超过130个弹出窗口,以新的方式与我们的客户互动。我们在生活方式类别(包括鞋类和成衣)上获得了吸引力,同时将我们的男性业务增长到了近9亿美元的POS。这些举措得到了引人注目的营销活动的支持,这些活动平衡了我们作为时尚权威的地位,同时扩大了我们的信息。我们推出迈克尔B.乔丹作为Coach男士的第一个全球大使,并在全年发布创新的文化相关和破坏性信息。随着我们不断提升全渠道能力,我们还推动了全球电子商务的发展和数字化创新。总的来说,我们看到Instagram,微信和微博上的品牌追随者有两位数的强劲增长。

Moving forward in FY ‘20, we will first accelerate product innovation and disruption; second, drive fashion authority through cultural relevance tapping into celebrities and influencers; third, inject excitement into stores with light touch, high impact refreshes; and fourth, fuel digital innovation in e-commerce growth benefiting from the enterprise initiatives underway. In summary, we are excited about the seasons ahead and remain confident in our largest brands opportunity for continued growth as we look to accelerate innovation and relevance globally.
Moving to Kate Spade and focusing on the fourth quarter. Total sales rose 6% on a reported basis and 7% in constant currency driven by new store distribution as well as the acquisition of the brand’s operations in Singapore, Malaysia and Australia, which we have not yet anniversaried. Comparable store sales fell below our expectations, declining 6% on an aggregate basis. Conversion comp in our bricks and mortars business accelerated on a sequential basis and was positive for the quarter, reflecting the emerging positive signs we are seeing with Nicola’s new product offering. However, traffic comp was significantly under pressure against the challenging backdrop in North America and compounded by the anniversary of the difficult comparison following the passing of the Brand’s Founder, which drove unusually high traffic as discussed last year. Conversely, our international business was essentially inline with our expectations and on a relative basis significantly outpaced the performance in North America, including positive comps in Greater China.
Turning to product, while the penetration of Nicola’s collection was consistent with our expectations in both retail and outlet, clearly, overall sales were not on plan. We feel strongly that we have the right strategic and creative direction based on customers’ response to the brand’s new iconic elements and strength we are seeing in select handbag offerings, such as the Margot, Molly and Nicola families, and most recently, the introduction of [indiscernible]. We have also experienced traction in jewelry and ready-to-wear. However, we were missing breadth of choice in key silhouettes, such as wear-to-work [indiscernible], as well as in the diversity of material ways. In addition, during the quarter, we introduced previous retail best selling styles into the outlet channel, Cameron Street and Jackson Street, which did not perform as expected. In short, while we refine the balance across silhouettes and full price, the outlet channel is the need of a much more substantial amount of distinctive newness than we planned.
Looking forward, our overarching objectives for Kate Spade remain unchanged, leveraging the brand’s unique positioning of optimistic femininity and leadership in the attributes of fashionable and fun. That said we felt it was important to provide you with some additional color on the specific actions underway to immediately address the areas of opportunity. First, we are applying our product and merchandising learnings by launching additional [indiscernible] and keeping with the brand’s feminine aesthetic updated in modern and relevant ways. We are introducing new designs in a broader range of high-quality materials that provide the structure, durability and functionality that the Kate Spade brand is known for. We also believe there is an opportunity in cross-bodies and backpacks given the hands-free trend in the market. We are bringing in additional witty and emotional novelty items, which have been hallmarks of the brand both as permanent and limited addition offerings. We are also planning to launch product collaborations across categories to drive excitement and buzz. For holiday, we are launching a new Make It Mine personalization program in both specialty stores and on our e-commerce site, which will feature an updated multifunction bag and accessories offering, designed to appeal to a broad audience.

在20财年,我们将首先加速产品创新和中断;第二,通过文化相关性吸引名人和影响者,推动时尚权威;第三,为商店注入轻盈,高冲击力的兴奋;第四,推动电子商务增长中的数字创新受益于正在进行的企业计划。总而言之,我们对未来的季节感到兴奋,并对我们最大品牌的持续增长机会保持信心,因为我们希望加速全球的创新和相关性。

转移到Kate Spade并专注于第四季度。由于新店铺分销以及该品牌在新加坡,马来西亚和澳大利亚的业务收购,我们尚未公布的总销售额在报告基础上增长了6%,恒定汇率增长了7%。可比店面销售额低于我们的预期,总体下降6%。我们的砖和砂浆业务的转换比例在连续的基础上加速,并且在本季度呈现积极态势,反映出我们在Nicola的新产品中看到的新兴积极迹象。然而,交通补偿在北美的挑战性背景下面临着巨大的压力,并且在品牌创始人过去后的艰难比较周年纪念日加剧了这一点,正如去年所讨论的那样,这带来了非常高的流量。相反,我们的国际业务基本符合我们的预期,并且在相对基础上大大超过了北美的业绩,包括大中华区的积极合作。

谈到产品,虽然Nicola系列的渗透率与我们在零售店和店铺的预期一致,但显然,整体销售并未按计划进行。我们强烈认为,我们拥有正确的战略和创意方向,这取决于客户对品牌新标志性元素的反应以及我们在精选手提包产品中所看到的实力,例如Margot,Molly和Nicola家族,以及最近推出的[不可分辨。我们还经历过珠宝和成衣的牵引力。然而,我们在关键轮廓中缺少广泛的选择,例如穿着工作[音频不清晰],以及物质方式的多样性。此外,在本季度,我们将以前的零售最畅销款式引入了出口渠道,Cameron Street和Jackson Street,这些都没有达到预期的效果。简而言之,虽然我们在剪影和全价格之间改善平衡,但是出口渠道需要比我们计划的更大量的独特新颖性。

展望未来,我们对Kate Spade的总体目标保持不变,利用该品牌独特的乐观女性气质和领导力,在时尚和乐趣的属性。这就是说,我们认为为正在进行的具体行动提供一些额外的颜色以立即解决机会领域非常重要。首先,我们通过推出额外的[音频不清晰]来应用我们的产品和商品学习,并以现代和相关的方式更新品牌的女性美学。我们在更广泛的高品质材料中引入新设计,提供Kate Spade品牌所熟知的结构,耐用性和功能性。鉴于市场上的免提趋势,我们也相信在机身和背包中有机会。我们正在引入额外的诙谐和情感新奇物品,这些品牌既是永久性的又是有限的附加产品。我们还计划推出跨类别的产品合作,以激发兴奋和嗡嗡声。假期,我们将在专卖店和电子商务网站推出新的Make It Mine个性化计划,该计划将包含更新的多功能包和配件,旨在吸引广大观众。

We are also excited by the footwear opportunity for the brand as we take the business in-house from our licensed partner, Steve Madden, beginning in the calendar 2020. We showed our new spring collection at Fannie just last week and the response was very positive as buyers describe the offering as relevant, fun, exciting and truly lifestyle in addressing many usage occasions. For stores, we are continuing to expand our distribution with the focus on international markets. That said we are deliberately pulling back on the number of new store openings for the brand, while we focus on maximizing awareness and productivity. In marketing, we will drive brand awareness and aspiration with both collaborations with global and local celebrities and influencers, leveraging the power of social media and PR buzz across markets.
In outlet, we are leaving no stone unturned. We are looking at product design, branding, merchandising, in-store experience and on-mall and direct e-mail marketing. In product, we are focused on accelerating the pace of newness with an assortment that is more clearly differentiated from the Saffiano heavy competitive set. This will also include the launch of new materials, branding elements and collaborations unique to the channel. We are also building out the successful Nicola designed AVA Group. With these measures in place, we have a comprehensive plan to drive an inflection in the business. Overall, we are acting swiftly and decisively applying our learnings to drive positive change and we remain confident in our direction and the $2 billion opportunity for improved profitability.
Turning to Stuart Weitzman, in FY ‘19 our priority was to return the brand to top line growth addressing the production challenges we faced exiting FY ‘18. I am pleased that we were successful in doing this with revenue increasing 17% in the fourth quarter on a reported basis and 20% in constant currency driving the mid single-digit gain for the year. We made important advancements in several key areas. In product, we focused on fit and construction, creating foundational pieces that were consistent with the brand’s DNA. We broadened our footwear offering while maintaining our authority, in iconic Stuart Weitzman styles. We also introduced brand new codes that we will build upon in the seasons and years ahead. We gained further credibility in handbags and leather goods, which remains an area of opportunity for the brand. We also drove international expansion, particularly in China, where we doubled our store footprint, including the acquisition of our business in Southern China and we completed the buyback of our operations in Australia, where we will leverage Tapestry’s multi-brand hub. Finally, we evolved the brand’s marketing, featuring a cast of new and culturally relevant global brand ambassadors, distorting our investment to digital.
Looking ahead to fiscal 2020, our strategic pillars include: first, enhancing our systems and processes to improve profitability. Key to this will be optimizing the supply chain in the wake of our three of our Phase 3 S4 go-live. Second, maintaining the brand’s boot and sandal authority, while expanding our footwear expression, especially in slacks and sneakers and keeping with current trends. This is paramount as we look to recapture the brand’s leadership position in top tier wholesale accounts. To this end, we were pleased with the initial positive feedback we received from our department store partners during the brand’s spring market presentation last month. Third, driving credibility in handbags through exceptional functionality and differentiated design and branding. Fourth, fueling customer desire through marketing, increased brand awareness globally and acquiring new customers; and fifth, expanding globally with the focus on China building on our current momentum.

我们也对该品牌的鞋类机会感到兴奋,因为我们从我们的授权合作伙伴史蒂夫·马登开始在2020年开始在内部开展业务。我们上周在Fannie展示了我们的新春季系列,回应非常积极因为买家将此产品描述为相关,有趣,令人兴奋和真正的生活方式,以解决许多使用场合。对于商店,我们将继续扩大我们的分销,重点是国际市场。也就是说,我们有意拉回该品牌新店开张的数量,同时我们专注于最大化意识和生产力。在市场营销方面,我们将通过与全球和本地名人及影响者的合作,利用社交媒体的力量和市场上的公关嗡嗡声来推动品牌知名度和愿望。

在出口处,我们不遗余力。我们正在关注产品设计,品牌推广,商品推销,店内体验以及商场和直接电子邮件营销。在产品方面,我们致力于通过与Saffiano重型竞争对手更明显区分的品种来加速新的节奏。这还包括推出新材料,品牌元素以及渠道独有的合作。我们也正在建立成功的Nicola设计的AVA集团。有了这些措施,我们就有了一个全面的计划来推动业务的变化。总的来说,我们正在迅速而果断地运用我们的学习来推动积极变革,我们对我们的方向和20亿美元的盈利机会保持信心。

谈到Stuart Weitzman,在19财年,我们的首要任务是让品牌恢复到顶线增长,以应对我们在18财年所面临的生产挑战。我很高兴我们成功地做到了这一点,第四季度的收入增长了17%,而恒定汇率则推动了今年中单位数增长的20%。我们在几个关键领域取得了重要进展。在产品方面,我们专注于贴合和构造,创造与品牌DNA一致的基础作品。我们以标志性的Stuart Weitzman风格扩展了我们的鞋类产品,同时保持了我们的权威。我们还推出了全新的代码,我们将在未来的几个季度和几年内建立起来。我们在手袋和皮革制品方面获得了进一步的信誉,这仍然是该品牌的一个机会领域。我们还推动了国际扩张,特别是在中国,我们在这里扩大了我们的商店足迹,包括收购我们在华南地区的业务,我们完成了在澳大利亚的业务回购,我们将利用Tapestry的多品牌中心。最后,我们发展了品牌的营销,展示了一批新的和文化相关的全球品牌大使,扭曲了我们对数字化的投资。

展望2020财年,我们的战略支柱包括:首先,加强我们的系统和流程,以提高盈利能力。关键是在我们的三期S4第三阶段上线之后优化供应链。其次,保持品牌的靴子和凉鞋权威,同时扩大我们的鞋类表达,特别是在休闲裤和运动鞋,并与当前的趋势保持一致。这是至关重要的,因为我们希望重新夺回该品牌在顶级批发账户中的领导地位。为此,我们对上个月品牌春季市场展示期间我们的百货商店合作伙伴提供的初步积极反馈表示满意。第三,通过卓越的功能和差异化的设计和品牌推动手袋的可靠性。第四,通过营销推动客户需求,提高全球品牌知名度并获得新客户;第五,全球扩张,重点关注中国目前的发展势头。

In summary, we have made significant progress in sharpening the focus of the brand’s core strengths and we remain excited about the opportunities for Stuart Weitzman. To recap, we have a clear vision and a unique global multi-brand platform. Our model is distinctive. We are brand-led and consumer-centric with the culture built-upon values of optimism, innovation and inclusivity. Each of our brands have differentiated attitudes, bringing diversification to our portfolio at the same time each can leverage Tapestry’s core capabilities and infrastructure to drive meaningful synergies.
Before I turn it over for the financial review, I would like to welcome our CFO, Joanne Crevoiserat to the team. I know that many of you have had the opportunity to work with her throughout her career. We are delighted that she has joined Tapestry. She has extensive financial and operational experience with established retailers and global brands and brings a unique perspective and important skill set to our Company. I am confident that she is the right person to lead our strong finance team, as we execute our strategic initiatives and long-term vision. Joanne?

总之,我们在提升品牌核心优势的重点方面取得了重大进展,我们对Stuart Weitzman的机遇感到兴奋。总结一下,我们拥有清晰的愿景和独特的全球多品牌平台。我们的模型很有特色。我们以品牌为主导,以消费者为中心,以文化为基础,建立乐观,创新和包容的价值观。我们的每个品牌都有不同的态度,在我们的产品组合中实现多样化,同时每个品牌都可以利用Tapestry的核心功能和基础设施来推动有意义的协同效应。

在我将其翻过来进行财务审核之前,我想欢迎我们的首席财务官Joanne Crevoiserat加入团队。我知道很多人在她的整个职业生涯中都有机会和她一起工作。我们很高兴她加入了Tapestry。她在成熟的零售商和全球品牌方面拥有丰富的财务和运营经验,为公司带来了独特的视角和重要的技能。我相信,在我们执行战略计划和长期愿景时,她是领导我们强大财务团队的合适人选。乔安妮?

Joanne Crevoiserat

Thanks, Victor. I’m very excited to be here at Tapestry working with the talented teams across the globe as we execute our brand and growth strategies. I’m also looking forward to reconnecting with many of you on the line and meeting those new to me who follow our story in the months ahead.

谢谢,维克多。 我很高兴能够在Tapestry与全球各地的优秀团队合作,同时执行我们的品牌和发展战略。 我也期待着与你们中的许多人重新联系,并在未来几个月里与那些关注我们故事的新朋友见面。

Victor Luis

Thank you, Joanne and before turning it over to Andrea, I’d like to recognize it for our hard work and energy over the last several months, that she has held the position of Interim CFO. Andrea, wear many hats within our organization. She is a mentor to many, and a key business partner to me and our leadership team, with an unparalleled understanding of our Company and its history. On behalf of our entire leadership team, thank you Andrea for year end less energy and leading the finance team in this period.
With that, I’ll now turn the call over to Andrea for a discussion of our financial results, as well as our outlook for fiscal year ‘20.

感谢Joanne,在将其转交给Andrea之前,我想在过去的几个月里认识到我们的辛勤工作和精力,她已经担任临时首席财务官。 安德里亚,在我们的组织内戴着许多帽子。 她是许多人的导师,也是我和我们领导团队的重要业务合作伙伴,对我们公司及其历史有着无与伦比的了解。 代表我们整个领导团队,感谢Andrea在这一时期不那么精力并领导财务团队。

有了这个,我现在将把这个电话转到Andrea,讨论我们的财务业绩,以及我们对20财年的展望。

Andrea Shaw Resnick

Thanks, Victor for those kind words, and good morning everyone. Victor has just taken you through the highlights and strategies. Let me now take you through some of the important financial details as well as our outlook for fiscal year ‘20. Before I begin, please keep in mind that the comments I’m about to make are based on non-GAAP results, corresponding GAAP results, as well as the related reconciliations can be found in the earnings release posted on our website today.
As Victor mentioned, it was an evolutionary year for the Company, we entered FY ‘19, understanding that it would be one of significant strategic investment as we built the foundation of our multi-brand platform. We also anticipated and achieved meaningful synergies from the successful integration of Kate Spade, in part funding these investments. At the same time, we delivered ongoing top and bottom line increases at Coach, the core of our house. That said, we did not drive the intended growth at Kate Spade and faced incremental industry wide promotional headwinds in the North America outlet channel. Overall, our EPS was in line with our most recent guidance.
Now turning to some key financial details of the fourth quarter, sales in the quarter rose 2% on a reported basis and 4% in constant currency, with disparate results by brand. We continue to drive positive same-store sales at Coach and delivered strong sales growth at Stuart Weitzman, lapping a challenging quarter from a year ago, while Kate Spade comps declined 6% in Q4. Consolidated gross margin declined 60 basis points versus prior year. For context, we did project and guide to a gross margin contraction for the quarter pressured by Kate Spade, given the brand’s difficult prior year compare, which included the financial benefit of unusually high full-price selling, following the founder’s passing, as well as the initial realization of synergies. In addition, Kate Spade’s gross margin was further pressured by incremental promotional activity, year-over-year, particularly in the North America outlet channel. In contrast, and importantly, both Coach and Stuart Weitzman delivered gross margin expansion over the prior year. SG&A expenses rose 2% in line with the top line increase. Operating income declined 3% and represented 14.6% of sales as compared to 15.3% in the prior year. Our EPS of $0.61 was a penny above last year and consistent with the implied guidance range for the quarter, reflecting in part a lower-than-expected tax rate. We also commenced our buyback period program during the quarter as reported, repurchasing approximately 3.4 million shares of common stock at an average cost of $29.31 for a total of $100 million.
Now, moving to global distribution, as highlighted in our press release across Tapestry, we added a net of 108 locations in FY ‘19 driven by international expansion at Kate Spade and Stuart Weitzman, including a total of 69 net new openings and 39 stores acquired through regional distributor buybacks. We ended the year with 1,540 directly operated stores globally. Turning to our balance sheet and cash flows at the end of the fiscal year, our cash and short-term investments were approximately $1.2 billion, while our borrowings outstanding were $1.6 billion, consisting primarily of senior notes. Inventory levels at year-end were $778 million, an increase of 16%, reflecting in part the unusually low ending inventory balance at Kate Spade in the prior year, given the magnitude of full price selling, following the founder’s passing. In addition, as discussed on our last earnings call, we’ve continued to experience port congestion in Asia, which has resulted in a higher level of in-transit. Importantly, we are confident that we can strategically manage our inventory, given its currency and our multi-channel distribution model. We have a plan to work through our inventory specifically at Kate Spade in a programmatic manner, during the first half of fiscal ‘20, which has been contemplated in our gross margin guidance.

谢谢,维克多那些客气话语,大家早上好。 Victor刚刚带您了解了亮点和策略。现在让我向您介绍一些重要的财务细节以及我们对20财年的展望。在开始之前,请记住,我即将发表的评论是基于非GAAP结果,相应的GAAP结果,以及相关的对账可以在我们今天网站上发布的收益发布中找到。

正如Victor提到的那样,对于公司来说这是一个进化的一年,我们进入了'19财年',因为我们已经建立了多品牌平台的基础,因此它将成为重要的战略投资之一。我们还预测并实现了Kate Spade成功整合的有意义的协同效应,部分资助了这些投资。与此同时,我们在我们家的核心Coach上实现了持续的顶线和底线增长。也就是说,我们没有推动Kate Spade的预期增长,并且在北美销售渠道面临着行业广泛的促销逆风。总体而言,我们的每股盈利符合我们最新的指引。

现在转向第四季度的一些重要财务细节,本季度销售额按报告基准增长2%,按固定汇率计算增长4%,品牌业绩不同。我们继续推动Coach的同店销售额增长,并在Stuart Weitzman实现强劲的销售增长,与去年相比创下了一个充满挑战的季度,而Kate Spade comps在第四季度下降了6%。综合毛利率较去年下降60个基点。就上下文而言,我们做了项目并指导了Kate Spade受压的季度毛利率收缩,因为该品牌的前一年比较困难,其中包括创始人过世后异常高价全价销售的经济利益,以及最初实现协同效应。此外,Kate Spade的毛利率受到逐年增量促销活动的进一步压力,特别是在北美销售渠道。相比之下,重要的是,Coach和Stuart Weitzman都实现了去年毛利率的扩张。 SG&A费用上涨2%,与收入增长一致。营业收入下降3%,占销售额的14.6%,而去年同期为15.3%。我们的每股盈利0.61美元比去年高出一分钱,与本季度隐含的指导范围一致,部分反映了低于预期的税率。我们还在报告季度开始了我们的回购期计划,回购了大约340万股普通股,平均成本为29.31美元,总计1亿美元。

现在,正如我们在Tapestry的新闻稿中所强调的那样,我们在2009财年增加了108个地点的网络,其中包括Kate Spade和Stuart Weitzman的国际扩张,包括共有69个净新开业和39个商店被收购通过区域经销商回购。今年我们在全球拥有1,540家直营店。谈到本财年末的资产负债表和现金流量,我们的现金和短期投资约为12亿美元,而我们的未偿还借款为16亿美元,主要包括优先票据。截至年底的库存水平为7.78亿美元,增长了16%,部分反映了Kate Spade上一年的非常低的期末库存余额,考虑到创始人过世后全价销售的幅度。此外,正如我们上次收益电话会议所讨论的那样,我们继续在亚洲遇到港口拥堵,这导致了更高的运输水平。重要的是,我们相信,鉴于其货币和多渠道分销模式,我们可以战略性地管理我们的库存。我们计划在20财年上半年以编程方式专门在Kate Spade处理我们的库存,这已经在我们的毛利率指导中进行了考虑。

For the full year, net cash from operating activities was an inflow of $792 million as compared to an inflow of $997 million a year ago. Our CapEx spending was $274 million versus $267 million a year ago. CapEx spend came in favorable to our expectations primarily to the – due to the timing of cash payments, which shifted into fiscal 2020 Free cash flow for the year with an inflow of $517 million versus an inflow of $729 million last year. And in FY ‘19 we returned a total of approximately $490 million to shareholders through our dividend as well as our recently instituted share repurchase program, representing approximately 95% of our free cash flow for the year.
Now turning to our capital allocation policy as Victor mentioned, while our long-term priorities remain unchanged, supported by our strong balance sheet and cash flow, we are modifying our policy in the near term, dedicating our resources to driving organic growth while returning capital to shareholders through our dividend and share repurchase program. To that end, in fiscal 2020 we do not expect to pursue a strategic acquisition. Now moving to our 2020 outlook, consistent with our prior practice, the following guidance is presented on a non-GAAP basis and replaces our previous guidance. Starting with Q1, we are projecting revenue in the first quarter to be slightly below prior year, this reflects, low-single digit comp growth at Coach. Kate Spade comps are expected to decline at a high-teens rate based on the current traffic trends we are seeing in the business, and as we address the product and merchandising challenges. We would also expect Stuart Weitzman to post an operating loss in this – its smallest quarter, reflective of wholesale shipment timing. We’re forecasting gross margin for Tapestry to be slightly pressured in the quarter, impacted by FX, notably at Coach, while SG&A is expected to increase, driven by new store openings and higher depreciation associated with our systems investments. Taken together, we expect Tapestry EPS to be in [Technical Difficulty] $0.37 in Q1.
Now turning to our full-year outlook, we expect total revenues for Tapestry in fiscal 2020 to increase at a low single digit rate from fiscal ‘19. This includes the expectation for low-single digit growth at Coach, driven by continued positive low-single digit comp. We expect Kate Spade to deliver low to mid-single digit sales growth, driven by distribution. At Stuart Weitzman we expect solid sales growth for the year. In addition, we are projecting a modest decline in Tapestry’s gross margin for the year, including the negative impacts associated with bringing Kate Spade’s footwear business in-house along with pressure from currency. Our gross margin forecast also incorporates the impact of U.S. tariffs on imports from China, including the 25% tariffs on handbags and small leather goods, currently in place, as well as the recently announced 10% tariff on the list of 300 billion of goods expected to go into effect on September 1 for categories such as footwear and ready-to-wear. As you know, we have a diversified manufacturing base and our exposure to China is relatively limited for handbags and small leather goods, where we’ve migrated our production. And while footwear and ready-to-wear are smaller but fast-growing categories for Tapestry, we do have more exposure currently to China.

全年,经营活动产生的净现金流入7.92亿美元,而一年前的流入量为9.97亿美元。我们的资本支出总额为2.74亿美元,而一年前为2.67亿美元。由于现金支付的时间安排,资本支出的支出有利于我们的预期,现金支付的时机已转入2020财年全年自由流动资金流入5.17亿美元,而去年流入的资金为7.29亿美元。在19财政年度,我们通过股息以及最近设立的股票回购计划向股东返还了约4.9亿美元,占我们当年约95%的自由现金流。

正如Victor提到的那样转向我们的资本配置政策,而我们的长期优先事项保持不变,在我们强劲的资产负债表和现金流的支持下,我们在短期内修改我们的政策,将我们的资源用于推动有机增长,同时回归资本通过我们的股息和股票回购计划向股东提供。为此,在2020财年,我们不期望进行战略性收购。现在,根据我们之前的实践,我们将转向2020年展望,以非GAAP为基础提供以下指导,并取代我们之前的指导。从第一季度开始,我们预计第一季度的收入将略低于上年,这反映出Coach的低单位数增长。根据我们在业务中看到的当前流量趋势以及我们解决产品和销售挑战的问题,预计Kate Spade comps将以很高的速度下降。我们还预计Stuart Weitzman会发布经营亏损 - 这是其最小的一个季度,反映了批发出货时间。我们预计Tapestry的毛利率在本季度将受到轻微压力,受外汇影响,特别是在Coach,而SG&A预计将增加,原因是新店开张和与我们的系统投资相关的更高折旧。总的来说,我们预计第一季的Tapestry EPS将达到[技术难度] 0.37美元。

现在转向我们的全年展望,我们预计Tapestry在2020财年的总收入将从19财年以低单位数增长。这包括对Coach低单位数增长的预期,这是由持续的正低位数组合推动的。我们预计Kate Spade将在分销的推动下实现中低个位数的销售增长。在Stuart Weitzman,我们预计今年销售额将实现稳健增长。此外,我们预计Tapestry今年的毛利率将略有下降,包括与Kate Spade的内部鞋类业务以及货币压力相关的负面影响。我们的毛利率预测还包括美国关税对中国进口产品的影响,包括目前对手袋和小型皮革制品征收25%的关税,以及最近公布的预计3000亿件商品的10%关税将于9月1日生效,用于鞋类和成衣等类别。如您所知,我们拥有多元化的制造基地,而我们在中国的曝光率相对有限,因为我们已经迁移了我们的产品。虽然Tapestry的鞋类和成衣是较小但快速增长的类别,但我们目前对中国的曝光率更高。

We expect SG&A growth to be approximately inline with top line growth. As you know, we’ve made several important investments in our multi-brand model and our brands over the last few years, which are foundational to our long-term success. These include new store openings and regional buybacks as we focus on expanding our brands and directly managing the customer experience in key international market, and systems to allow us to drive sustainable growth in an increasingly digital world.
Net interest expense is expected to be in the area of $45 million to $50 million for the year. The full year fiscal 2020 tax rate is projected to be in the area, 17.5%. And overall, we are projecting earnings per diluted share to be roughly even with prior year. This incorporates the expectation of share repurchase of approximately $300 million in fiscal ‘20. We expect CapEx to be approximately $300 million for the year, which includes the shift in cash payments from 4Q ‘19 as mentioned. Touching briefly on our FY ‘20 directly operated distribution plans, across Tapestry our distribution expansion efforts will focus on international market. By brand, we expect little change in our Coach, directly operated store count with closures in North America, offset by modest net openings internationally. Stuart Weitzman we expect to open a net of 15 to 20 locations globally, and the Kate Spade we’re projecting 30 to 40 net openings in FY ‘20. As noted in our press release this morning, this represents a modestly slower pace of openings at Kate Spade as compared to FY ‘19 and our prior projection as we strategically focus on maximizing the brand’s productivity.
In closing, we are focused on executing our vision, supported by a strong balance sheet and cash flows, providing us with important financial and strategic flexibility, while enabling us to return meaningful capital to our shareholders.
I’d now like to open it up to Q&A.

我们预计SG&A增长将与收入增长大致相符。如您所知,我们在过去几年中对我们的多品牌模型和品牌进行了几项重要投资,这些投资是我们长期成功的基础。这些包括新店开张和区域回购,因为我们专注于扩展我们的品牌并直接管理主要国际市场的客户体验,以及系统,以便我们在日益数字化的世界中推动可持续增长。

全年净利息支出预计将在4500万美元至5000万美元之间。预计2020财年全年税率将在该地区,为17.5%。总体而言,我们预计每股摊薄收益与上一年大致相同。这包含了在20财年对股票回购的预期,约为3亿美元。我们预计今年的资本支出约为3亿美元,其中包括如上所述从2009年第四季度开始的现金支付转移。简要介绍我们的20财年直营分销计划,在Tapestry,我们的分销扩张工作将专注于国际市场。按品牌划分,我们预计我们的Coach几乎没有变化,直接运营的商店数量与北美地区的关闭数量有关,而国际网点开放量则有所抵消。我们预计Stuart Weitzman将在全球范围内开设15到20个网点,Kate Spade我们预计在20财年将有30到40个网络开放。正如我们今天早上的新闻稿中所指出的那样,与19财年和我们之前的预测相比,Kate Spade的开业速度略有放缓,因为我们的战略重点是最大化品牌的生产力。

最后,我们专注于执行我们的愿景,在强大的资产负债表和现金流的支持下,为我们提供重要的财务和战略灵活性,同时使我们能够向股东返还有意义的资本。

我现在想打开Q&A。

问答环节

Thank you. [Operator Instructions] Our first question comes from the line of Bob Drbul of Guggenheim Securities.

谢谢。 [操作员说明]我们的第一个问题来自Guggenheim Securities的Bob Drbul。

Bob Drbul

Hey, good morning. Joanne, welcome and congratulations. Best of luck.

嗨,早安。 乔安妮,欢迎和祝贺。 祝你好运。

Joanne Crevoiserat

Thanks Bob.

谢谢鲍勃。

Bob Drbul

I guess, I’d like to focus just on the Kate Spade brand for a minute. Victor, are you still confident about Kate’s brand health? And I guess when you look at the results this quarter, how did you not see it coming and how will you fix it? When you look at it, contrasting it to the strong Coach brand performance, can you just talk a little bit about that as well? Thanks.

我想,我想专注于Kate Spade品牌一分钟。 维克多,你对凯特的品牌健康还有信心吗? 我想当你看看本季度的结果时,你是怎么看不到它的,你将如何解决它? 当你看到它,与强大的Coach品牌表现形成鲜明对比时,你能谈谈这一点吗? 谢谢。

Victor Luis

Okay. Thank you, Bob. Maybe I’ll start with the contrasting with Coach, get into Kate and then Josh can support at the end on the Coach’s performance, which of course is really outperforming, not only here in the U.S. but truly globally against our more direct competitive set, could not be prouder of that team and the work that they’re doing, they’re really hitting on all cylinders. On Kate, as you all know, we saw a significant improvement in the third quarter, and really many emerging signs of the traction post the launch of Nicola’s collection, we saw a positive conversion comps, we launched a new core family in Margot, late followed by Polly which is really checking and increasingly we received, really positive signs across categories, especially ready-to-wear in jewelry with the iconography of working well, that we launched. As we entered Q4 we were optimistic, of course we are supported by the Easter shift and with the amount of newness that we had coming in, starting in the outlet channel. What we saw though was through May, into June, but especially beginning in May was rapid deterioration in the North American environments, traffic declined. And especially in the outlet channel, this led to increasing promotion across competitors. And in fact, I would say across the channel. And as all of you know, Kate is disproportionately impacted, given its nascent international footprint and its dependence on North America relative to the Coach brand. In addition, I would add that Kate simply did not have the level of distinctive newness, that we needed to drive conversion in that channel, especially given the decreasing traffic and especially against the Saffiano heavy competition.
For context, when we transformed the Coach brand, one of the strategies that we took early on, when Stuart joined was to take top selling previous full price collections, we re-engineered, then we launched them an outlet and we really drove terrific AURs. In the case of Nicola, you’ve heard us talk Nicola’s collections, you’ve heard us talk about the fact that approximately 30% of the outlet product was Nicola designed product. Of that 30% of the total, two-thirds, or 20% of the total were slightly more actually – whereas we had done with Coach, taking previous full priced top sellers which Nicola reengineered – re-touched, added some functionality and brought into the channel. Specifically, collections Cameron Street and Jackson Street which are today, still core to our business. And unfortunately are not performing as we expected, and the key learning there is that, they were just not perceived as new enough in the outlet channel, especially as they were Cameron Street, Saffiano-based collections and not able to compete with some of the major competitors who are really being promotional in those key platforms. And what we began to see basically is with that pressure and with the continued traffic pressures, the collections are simply still not pulling their way, and now we are prioritizing gross margin and quite frankly, longer term brand health. The good news, so what do we see? First AVA which was 100% designed by Nicola and it’s under 10% of the total outlet, is truly outperforming and gives us a lot of confidence as we bring in tremendous amounts of distinctive newness over the next months and quarters. And we’re also pleased with the performance that we’re seeing outside of North America, especially in Asia and in Greater China, where we’re seeing positive comps, and is a key area of investment for us.

好的。鲍勃,谢谢你。也许我会从与Coach的对比开始,进入Kate,然后Josh可以最终支持Coach的表现,这当然是非常出色的,不仅在美国,而且在全球范围内对抗我们更直接的竞争对手,不能为那支球队以及他们正在做的工作感到骄傲,他们真正打击了所有气瓶。关于Kate,众所周知,我们看到第三季度有了显着改善,并且在Nicola的系列推出后出现了许多新兴迹象,我们看到了积极的转换效果,我们在Margot推出了一个新的核心系列,已经很晚了其次是Polly,它真的在检查,我们越来越多地收到了各种类别的真正积极迹象,特别是我们推出的带有运作良好图标的珠宝成衣。当我们进入第四季度时,我们很乐观,当然我们得到了复活节转变的支持,以及我们从出口渠道开始的新的数量。我们看到的是从5月到6月,但特别是在5月开始,北美环境迅速恶化,交通量下降。尤其是在渠道渠道中,这导致了竞争对手的不断增加。事实上,我会说整个频道。正如大家所知,凯特受到的影响尤为严重,因为其新生的国际足迹以及对北美相对于Coach品牌的依赖。此外,我还要补充一点,凯特根本没有独特的新颖程度,我们需要在那个频道推动转换,特别是考虑到交通量减少,特别是对Saffiano的激烈竞争。

在上下文中,当我们改变Coach品牌时,我们早期采取的策略之一,当Stuart加入时,我们重新设计了最畅销的先前全价格系列,然后我们推出了它们的出口,我们真的推动了极好的AURs 。在Nicola的情况下,你听说过我们谈论Nicola的系列,你听说我们谈到大约30%的插座产品是Nicola设计的产品。其中30%占总数的三分之二,占总数的20%实际上稍微多一点 - 而我们已经与Coach合作,收购了Nicola重新设计的以前全价销售的顶级卖家 - 重新触动,添加了一些功能并引入这个频道。具体来说,今天的Cameron Street和Jackson Street收藏品仍然是我们业务的核心。不幸的是,这并没有像我们预期的那样表现,并且关键的学习是,它们在出口渠道中并没有被认为是新的,特别是因为它们是Cameron Street,Saffiano的收藏品并且无法与其中一些在这些关键平台上真正进行推广的主要竞争对手。而我们开始看到的基本上就是这种压力和持续的交通压力,收藏品仍然没有拉动他们的方式,现在我们优先考虑毛利率,坦率地说,长期品牌健康。好消息,那么我们看到了什么?第一款AVA由Nicola设计100%,占总销售额的10%以下,真正表现出色,给我们很大的信心,因为我们在接下来的几个月和几个季度带来了巨大的独特新鲜感。我们也对北美以外的业绩表示满意,特别是在亚洲和大中华地区,我们看到了积极的合作,并且是我们投资的关键领域。

So key steps, Bob, to your – the second part of your Kate question and what are we working on, what we’re doing. So look with a great sense of urgency the Kate Spade team is really focused on first and foremost product. In the full price channel I would say it’s much more tweaking the collections, really getting in high function styles that are focused on our key wear-to-work consumer. And outlet, it’s truly about distinctive innovation, both in silhouettes, materials and I would say even in branding, as we continue to diversify collections. And then in both channels, we are looking to truly leverage novelty, which is a key part of the brand, while launching coming up in the second quarter, Make It Mine and I think as you heard in my notes, Q3, the launch of footwear. And taking a lot of learning’s from what’s happening across brands and those that are truly engaging effectively with consumers. We have a tremendous amount of activation in store as well as collaborations coming up. On the marketing side, you guys will hear us talk a lot about leveraging influencers and celebrity, stay tuned there, we will have one or two announcements in the not too distant future on key partnerships there. And then stores, the focus right now is truly on driving productivity. We’re going to be doing some light touch investments especially in the most productive part of our outlet fleet and there you’re going to see us look at fixture productivity, signage and window package renewals, as we look to truly drives a much bigger change in the eye of the consumer.
Turning to brand health, saying all of that and that gives you, I think a little bit of a synopsis on where we were, what we saw, steps that we’re taking and now looking at brand health. Look, we just finished, recently May into June, a global brand tracker. We interviewed thousands of consumers here in North America across all of our brands and the competitive set, and we are confident in the health of the brand and it actually gave us confidence in the creative direction and Nicola’s vision. We continue to be very strong, in a very unique position, we lead in the key emotional attributes of fashionable, fund and feminine, and the key is really in tweaking our execution in some of those areas and I remain very confident, and Kate being a $2 billion opportunity. And being so, at gross margins that are going to be similar to Coach and like categories, and that remains our clear vision. As I mentioned, relative to Coach, Bob could not be prouder of Josh and the team, and what they’re doing in that brand, because as I said, they’re really hitting on all cylinders. I’ll let Josh talk a little bit about what he is seeing both globally and here in North America as that brand truly, I think outperforms the direct competition in a very strong way. Josh?

所以关键步骤,鲍勃,你的 - 凯特问题的第二部分,我们正在做什么,我们正在做什么。因此,Kate Spade团队非常紧迫地注重首要产品。在完整的价格渠道中,我会说它更多地调整收藏品,真正进入高功能风格,专注于我们的关键穿戴工作消费者。而且,它是真正关于独特的创新,无论是在剪影,材料还是我会说甚至在品牌推广,因为我们继续多样化集合。然后在这两个渠道中,我们都希望真正利用新颖性,这是该品牌的关键部分,同时在第二季度推出Make It Mine,我认为正如您在我的笔记中所听到的那样,Q3,鞋类。并从各个品牌和那些真正与消费者有效合作的事件中吸取了大量的知识。我们在商店中进行了大量的激活以及即将开展的合作。在营销方面,你们会听到我们谈论利用有影响力的人和名人的话题,在那里保持关注,我们将在不久的将来就那里的重要合作关系发布一两个公告。然后是商店,现在的重点是真正提高生产力。我们将进行一些轻松的投资,特别是在我们的出口车队中最高效的部分,你会看到我们看看夹具生产力,标牌和窗户包更新,因为我们希望真正开车更大改变消费者的眼球。

谈到品牌健康,说到所有这一切,并且这给了你,我想一点关于我们在哪里,我们所看到的,我们正在采取的步骤以及现在关注品牌健康的概要。看,我们刚刚完成,最近5月进入6月,成为全球品牌追踪者。我们采访了所有品牌和竞争对手的北美数千名消费者,我们对品牌的健康充满信心,实际上让我们对创意方向和Nicola的愿景充满信心。我们仍然非常强大,在一个非常独特的位置,我们引领时尚,基金和女性的关键情感属性,关键是真正调整我们在某些领域的执行,我仍然非常自信,凯特是一个20亿美元的机会。如此,在毛利率方面将与Coach和类似的类别相似,这仍然是我们清晰的愿景。正如我所提到的,相对于Coach,Bob不能对Josh和团队感到骄傲,以及他们在该品牌中所做的事情,因为正如我所说,他们真正打击了所有气瓶。我会让Josh稍微谈谈他在全球和北美这里看到的真正的品牌,我认为以非常强大的方式优于直接竞争。乔希?

约书亚舒尔曼

Thank you, Victor. And good morning, Bob. So you know how we’re thinking about innovation at Coach is really at the heart, I think of how we’ve been able to drive the seven consecutive quarters of positive comps, and the gross margin expansion that we’ve been able to see this year. And so I’ll share a little bit about how we’re thinking about driving this balance of consistency and disruption within the brand, really across three pillars. So, the first is, we have to consistently innovate in our core. We have to – yes, every day in every channel have our core products at good, better, best price points with product excellence and innovation there. I think the best example of that, that we’ve talked about on numerous calls and – that you’ve seen in our stores is the re-launch of Signature, which is now into its second year and is continuing to drive a high AURs in our retail channel actually higher AURs than leather. And we have examples of that, of the innovation and core product in our outlet channel as well, whether that has been The Edit at best clinical prices or whether that has been a new introductions like Jet really speaking to our broad customer around the world.
The second pillar is more about the disruption, and that is – and I call that collaboration or co-creation. And during this year we have had an unprecedented number of activations, pop-ups, drops, capsules where we’re either collaborating with a third-party or driving innovation around important cultural moments. So in this quarter, in this most recent quarter, we did at 360 activations around Mother’s Day, particularly important in North America, where it’s the visual, it’s the product, it is the whole experience we’ve done, third-party partnerships. We did artist collaborations with a series of Chinese artists, which we call the Rexy Remix which we rolled out in our retail channel. In outlet, we did a collaboration all around ‘80s video games Pac-man – Ms. Pac-Man and these are traffic driving collaborations. And so when we do these activations, they have really helped us, and I think you see that this quarter, they helped us in a traffic challenged environment, drive the traffic to Coach, in the malls, in the full-price malls and the in the outlet malls. And then the third pillar, I would say, is around acceleration, so there is innovation, collaboration and acceleration. And acceleration is really for our categories where we – we consider our growth categories so, our men’s business which is approaching $900 million, our footwear business and our ready-to-wear business. And how do we have distinct strategies to drive growth in those areas. And I think what you’re starting to see is you’re starting to see how those three pillars can work together consistently, back to buy marketing that is no longer, just about one seasonal fashion message – about something much broader, which is driving a cultural relevance through marketing. And so you see – we have a mix of global ambassadors like a Michael B. Jordan or a more regional ambassador like Kiko Mizuhara in Japan, and driving these messages across the digital channels, and using those digital channels as really the hub of an ecosystem that brings the customers into the stores. And so, we can’t be complacent, it’s competitive out there, but we have a pretty exciting pipeline ahead of these types of innovations and activations.

谢谢你,维克多。鲍勃,早上好。所以你知道我们如何考虑Coach的创新是真正的核心,我想到我们如何能够连续七个季度推动积极因素,以及我们能够看到的毛利率扩张今年。因此,我将分享一些关于我们如何考虑在品牌内实现一致性和中断的平衡,真正跨越三大支柱。所以,首先,我们必须不断创新我们的核心。我们必须 - 是的,每个渠道中的每一天都有我们的核心产品,以优质,更好,最优惠的价格,产品卓越和创新。我认为最好的例子就是我们在众多电话中谈到的 - 你在我们的商店看到的是Signature的重新推出,现在已进入第二年,并继续推动高AURs在我们的零售渠道中,AUR比皮革更高。我们的出口渠道中的创新和核心产品也是如此,无论是最佳临床价格还是最佳临床价格,还是像Jet这样的全新介绍真正与我们全球广大客户交流。

第二个支柱更多的是关于破坏,那就是 - 我称之为合作或共同创造。在今年,我们已经进行了前所未有的激活,弹出,滴,胶囊,我们要么与第三方合作,要么围绕重要的文化时刻推动创新。因此,在本季度,在最近一个季度,我们在母亲节周围进行了360次激活,在北美特别重要,在那里它是视觉,它是产品,它是我们所做的整个体验,第三方合作伙伴关系。我们与一系列中国艺术家合作,我们称之为Rexy Remix,我们在零售渠道推出。在插座方面,我们在80年代的视频游戏Pac-man - Pac-Man女士之间进行了合作,这些都是交通驾驶合作。因此,当我们进行这些激活时,他们确实对我们有所帮助,而且我认为您看到本季度,他们帮助我们在交通挑战的环境中,为商务,商场,全价购物中心和在商场里。我认为,第三个支柱是加速,因此有创新,协作和加速。加速对我们的类别来说真的是我们 - 我们考虑我们的增长类别,我们的男士业务接近9亿美元,我们的鞋类业务和我们的成衣业务。我们如何制定不同的战略来推动这些领域的增长。而且我认为你开始看到的是你开始看到这三大支柱如何能够一致地运作,回到购买不再是营销的营销,只是一个季节性的时尚信息 - 关于更广泛的东西,这就是推动通过营销实现文化相关性。所以你看 - 我们有像Michael B. Jordan这样的全球大使,或者像日本的Kiko Mizuhara这样的区域大使,并通过数字渠道推动这些信息,并将这些数字频道用作生态系统的中心这将客户带入商店。因此,我们不能自满,它在那里具有竞争力,但在这些类型的创新和激活之前,我们有一条非常令人兴奋的管道。

Victor Luis

Yes. And I think I would just close to wrap up on those points there. Please if you haven’t had the opportunity, do take a couple of visits to a couple of key outlet stores in your region, and walk the competitive set compared with Coach’s execution and you’ll – I think very easily understand a lot of the great work that Josh has just explained, impacting across all channels at once. And we’re on that journey with Kate and I’m very confident in that team’s ability with Anna and Nicola and very talented folks, they have supporting them to execute accordingly.

是。 而且我想我会接近完成那些要点。 如果您没有机会,请访问您所在地区的几家主要直销店,并与Coach的执行相比,参加竞争对手,您将 - 我认为很容易理解很多 乔希刚刚解释过的出色工作,同时影响了所有渠道。 我们和Kate一起踏上了这段旅程,我对这支团队与Anna和Nicola以及非常有才华的人们的能力非常有信心,他们支持他们相应地执行。

Bob Drbul

Great. Thank you very much. Good luck.

非常好。 非常感谢你。 祝好运。

Victor Luis

Thank you.

谢谢。

会议主持员

[Operator Instructions] Your next question comes from the line of Irwin Boruchow of Wells Fargo.

[操作员说明]您的下一个问题来自富国银行的Irwin Boruchow。

Irwin Boruchow

Hi, good morning everyone. Just two quick questions on Kate. On the store growth pullback can you Victor is that tied to any specific region or is that broad-based globally, just overall? And then I appreciate all the guidance on the year for the business, but is there any chance you could give a little bit more color on your view of Kate for the year as you progress you kind of gave us some comp expectations for Q1. Can you help us how you’re thinking about how that business should progress through the year? Both comp and on operating profit metrics, anything that you’re comfortable sharing? And most specifically are you targeting a positive comp at some point this fiscal year? Thank you very much.

大家好,大家早上好。 关于凯特的两个简短问题。 在商店增长回落中你可以将Victor与任何特定地区联系起来,还是全球范围内广泛的整体? 然后我感谢所有关于这一年的业务指导,但是你有没有机会在你对Kate的看法上给出更多的颜色,因为你的进步让我们对Q1有了一些预期。 您能否帮助我们思考一年中该业务应如何发展? comp和on营业利润指标,你喜欢分享的任何东西? 最具体的是,您是否在本财年的某个时候针对积极的补偿? 非常感谢你。

Victor Luis

Sure. Thanks. In terms of the openings really our focus is on productivity, I mean you were planning above 40 locations for the year, we’re still planning between 30 and 40, we’re just being much more selective. And with the continued focus on Asia and especially in China where we are seeing the opportunity of course to leverage those investments as part of our greater program to build brand awareness there, which clearly remains the number one single growth opportunity for that brand and for us from an awareness perspective. In terms of Kate and through the year and comps, first and foremost, I think we gave guidance that we’re expecting low-to-mid single digit sales growth, driven by distribution. At this point I won’t be making a call on the exact timing of positive comps, particularly given the dependence of Kate Spade, what is the challenge North America environments of course we expect clear improvement throughout the year as significant newness hits, and of course as we enter a period of easier compares once we get into Q2, Q3 and Q4. But at this point, I would say that you should expect that our confidence in the mid-to-single digit total growth driven by distribution.

当然。谢谢。在开放方面,我们真正关注的是生产力,我的意思是你计划在今年的40个地点以上,我们仍然计划在30到40之间,我们只是更有选择性。随着对亚洲的持续关注,特别是在中国,我们看到有机会利用这些投资作为我们在那里建立品牌知名度的更大计划的一部分,这显然仍然是该品牌和我们的头号单一增长机会从意识的角度来看。就凯特而言,通过年度和综合报告,首先,我认为我们给出的指引是,我们预计在分销的推动下,中低个位数的销售增长。在这一点上,我不打算对正面比赛的确切时间进行调用,特别是考虑到Kate Spade的依赖性,北美环境面临的挑战是什么,当然我们预计全年会有明显改善,因为重要的新事物会受到影响,并且当我们进入第二季度,第三季度和第四季度时,我们进入一个更容易比较的时期。但在这一点上,我会说你应该期望我们对分销推动的中到数位总增长的信心。

Ike Boruchow

Thank you.

谢谢。

Victor Luis

Thank you, Ike.

谢谢你,艾克。

会议主持员

Your next question comes from the line of Erinn Murphy of Piper Jaffray.

你的下一个问题来自Piper Jaffray的Erinn Murphy系列。

Erinn Murphy

Great. Thanks, good morning. I guess my question is around the EBIT dollar guide, I guess you moved from what would have been roughly $95 million of incremental EBIT growth, and now it looks like EBIT dollars are slightly down for the year. Can you just help us walk through the moving parts by brand, is that all Kate Spade or there, incremental investments? And are you still expecting Coach and Stuart Weitzman in that guide to be positive contributors to EBIT dollars? Thank you.

非常好。 谢谢,早上好。 我想我的问题是围绕息税前利润美元指导,我猜你已经从大约9500万美元的息税前利润增长中转移,现在看来EBIT美元今年略有下降。 你能帮助我们按品牌走过移动部件吗?那就是所有Kate Spade还是那里的增量投资? 您是否仍然期望该指南中的Coach和Stuart Weitzman成为EBIT美元的积极贡献者? 谢谢。

Andrea Shaw Resnick

Sure Erinn. So, in terms of the primary change, absolutely correct, it’s really coming from Kate Spade where we now have taken down top line growth through a combination of lower than originally expected comp as well as the modern the modification in our store opening schedule. As you know, we had 40 to 50 originally planned, now we have 30 to 40 as Victor just mentioned. Those are the primary reasons, the primary delta from where we were. And then of course we do still have elevated SG&A specifically at the Kate brand associated with the new store openings that we opened this year, as well as we won’t anniversary the buyback until the end of the first quarter. So it is really primarily coming from the Kate Spade brand, we are looking for operating income generation at Stuart Weitzman, although the first quarter will be probably a similar operating loss to what we exited fourth quarter and of course Coach is, I would say, steady as she goes or it goes.

当然是艾琳。 因此,就主要变化而言,绝对正确,它实际上来自Kate Spade,我们现在通过低于最初预期的组合以及我们商店开业时间表中的现代修改来降低收入增长。 如你所知,我们最初计划有40到50个,现在我们有30到40个正如Victor所提到的那样。 这些是主要原因,我们所处的主要三角洲。 当然,我们仍然会在今年开设的新店开业时,特别是Kate品牌的SG&A升级,以及我们不会在第一季度结束前回购周年纪念日。 所以它主要来自Kate Spade品牌,我们正在寻找Stuart Weitzman的营业收入,尽管第一季度可能与我们退出第四季度相似,但我认为Coach当然也是如此。 她走的时候还是稳定的。

Christina Colone

Great. Thank you so much.

非常好。 非常感谢。

Erinn Murphy

Thank you.

谢谢。

会议主持员

Your next question comes from the line of Alex Walvis of Goldman Sachs.

您的下一个问题来自高盛的Alex Walvis系列。

Alex Walvis

Good morning, thanks for taking the question. I wanted to ask a question about the decision to bring footwear in-house at Kate Spade. And I wonder if you could reflect on the same strategy at Coach, how that’s progressed versus your plan on what’s worked well there? And why the decision to do that with Kate now and how that could be an opportunity and ways it could differ from the Coach experience?

早上好,谢谢你提出这个问题。 我想问一个关于在Kate Spade内部带鞋的决定的问题。 而且我想知道你是否可以在Coach上反思同样的策略,这与那些在那里运作良好的计划相比有何进步? 为什么现在决定与凯特一起做这件事,以及这可能是一个机会和方式可能与教练的经历有什么不同?

Victor Luis

Sure, very clear opportunity, Alex, for us. We’ve taken, basically the last, I would say, two to three years to establish a very solid product developments, production capacity in footwear in Asia, incredibly pleased to have with us Tom Glaser who comes of course from a very deep experience in that space, supporting our teams as we look to truly get best-in-class in all of these categories, so he will provide key leadership and we have a team at Kate that has experience in doing this. And I can tell you we’ve just shown the first Kate collection at Fanny as well of course of Coach and Stuart Weitzman, just basically wrapping up a week of markets here in New York across all three brands. And what I can share with you is that in all three brands the reaction has been superb. Kate it’s first collection, if I compare to Coach’s first collection three years ago, they’ve really taken a leap forward, whether it’s from a design perspective, silhouette style perspective, excuse me the usage occasion and in terms of product development, leveraging pricing and developing and the development capacity that we established with Coach, over the last three years. I go into the Kate first season with a lot more confidence than we entered Coach three years ago.
I would also add that this season in Fanny, Josh and the Coach team have taken a very substantial lead role. We’ve been operating now for a few months, Josh and his team have with some new third-party development capabilities, especially in the core sneaker business, which as many of you know, is driving a huge trend in footwear, we just showed a new collection, which has been incredibly well received at wholesale and by our own teams, so fully excited by that. And for those of you who follow on Instagram and maybe have Stuart Weitzman on your feed, you’ll see the new sneaker collection that they’ve just launched a Daryl, which is really new to them. Given that they were at sandal and food resource, and very excited of course, as we enter fall-winter given that they are such a strong group resource, but it’s truly a good reflection of the Eraldo and that teams move to also diversify and bring new usage occasions to the brand. So this is a great platform, I think, was really coming into our own and I speak with a good level of confidence on that, look in the first year financially, there is a small investment that takes place, but really minor from year two, this thing becomes much more accretive than the royalty, it was a timely business relative to the Coach license that we took back. We’re very thankful to the partners that we had not in their predecessors, but now it really is about us leveraging this key strategic category along with core handbags and accessories and outerwear as core drivers for all of these investments that we’re making in our own direct distribution and with key third-party partners.

当然,非常清楚的机会,Alex,对我们来说。我们已经采取了,基本上是最后一次,我想说,两到三年来建立一个非常可靠的产品开发,在亚洲的鞋类生产能力,非常高兴与我们Tom Glaser,当然来自于非常深刻的经验这个空间,支持我们的团队,因为我们希望在所有这些类别中真正获得最佳,所以他将提供关键的领导力,我们在凯特有一个团队,有这方面的经验。而且我可以告诉你,我们刚刚在Fanny展示了第一个Kate系列以及Coach和Stuart Weitzman的课程,基本上这三个品牌在纽约市场已经基本结束了一周的市场。我可以与您分享的是,在所有三个品牌中,反应都非常出色。凯特它的第一个系列,如果我与三年前Coach的第一个系列相比,他们真的实现了一次飞跃,无论是从设计角度,剪影风格角度,请原谅我的使用场合和产品开发,利用定价在过去的三年里,我们与Coach建立了发展和发展能力。我进入凯特的第一个赛季比三年前我们进入教练的信心更强。

我还要补充一点,本赛季在范妮,乔什和教练团队中扮演了非常重要的角色。我们现在已经运营了几个月,Josh和他的团队拥有一些新的第三方开发能力,特别是核心运动鞋业务,正如你们所知,正在推动鞋类的巨大趋势,我们只是展示了一个新的系列,在批发和我们自己的团队非常受欢迎,因此非常兴奋。对于那些在Instagram上关注并且可能在你的饲料上有Stuart Weitzman的人,你会看到他们刚推出的新款运动鞋系列Daryl,这对他们来说真的很新。鉴于他们是凉鞋和食物资源,当然我们非常兴奋,因为我们进入了秋冬,因为他们是如此强大的团队资源,但它确实是Eraldo的良好反映,并且团队也变得多样化并带来品牌的新用法场合。所以这是一个很好的平台,我认为,它真的是我们自己而且我对此有充分的信心,从第一年的财务状况看,有一小笔投资发生,但从第二年开始就很小,这件事比版税更具增值性,相对于我们收回的Coach许可,它是一个及时的业务。我们非常感谢我们在他们的前任中没有的合作伙伴,但现在我们真正关心的是我们利用这一关键战略类别以及核心手袋和配件以及外衣作为我们所做的所有这些投资的核心驱动因素。我们自己的直接分销和主要的第三方合作伙伴。

会议主持员

Your next question comes from the line of Oliver Chen of Cowen & Company.

您的下一个问题来自Cowen&Company的Oliver Chen。

Oliver Chen

Hi, thank you. Regarding Kate Spade what are your thoughts regarding the customer reception of the newness ahead and how the sequencing may go as customers look to the changes? Also, I would love your thoughts on the codes of the Kate Spade house and how you evaluated? How those are performing or tweaks you may make? And then finally regarding Kate, just ensuring that there is a great level of distinctiveness versus Coach and that the segmentation is how you wanted. That would be great to hear this, your thoughts. Thank you.

嗨,谢谢你。 关于凯特·斯佩德,您对客户对新事物的接受有何看法以及在客户关注变化时如何进行排序? 另外,我会喜欢你对Kate Spade房屋代码的看法以及你如何评价? 你可能会如何表现或调整? 然后最后关于凯特,确保与教练相比具有很高的独特性,并且分割是您想要的。 听到这个,你的想法会很棒。 谢谢。

Victor Luis

Yes. Great. Great question. Look, Kate has really unique positioning. And in many ways, I would say, first and foremost from an addiction perspective, definitely considered on the fashion and given its stronger reliance on ready-to-wear traditionally and other accessory categories, including jewelry tech, much SKUs much younger, much more millennial than Coach. And I would say, has a very strong in the hand bag space, a very strong and I’m talking here in North America now, because we’re very much in the early stages of building this business outside of Japan internationally, very strong suburban consumer who see that as a key wear-to-work resource and we’re really focused on providing that functionality. I think, that relative to differences between Coach and Kate, the teams are completely separate, Nicola and [indiscernible], they don’t come in and look at the Coach collections from Stuart, Stuart doesn’t go over and with the Kate collections, obviously in the fashion world they follow in general trends, but I think you’ll see, whether it’s in product and functionality, that you would go to the full price stores, it’s probably a good place to visit where they’re across from each other here at the Hudson Yards Mall here in Manhattan, where you can see Coach and Kate. The Kate experience and the Coach experience are very, very different. Kate speaking to her customer with its very specific codes in femininity, that I’m going to talk to in a minute and Coach to its customer with a much more urban fashion take, and I would say Stuart’s leverage of Coach is much more house of leather coats.
If we look at Kate and the codes that we’ve launched, and I think I touched upon this in my remarks, in terms of our ability to compete effectively in the outlet channel. Kate has traditionally depended on a few very core clothes, first and foremost from the material perspective, there has been about Safiana; from a silhouette perspective, it has been about satchels and wear-to-work types of styles and from a branding perspective, it’s really been about that Kate Spade New York metal lock-up, which is on these products. These are traditional codes, they’re used by many brands across the spectrum and the issue is just that, one is Safiana, in and of itself is a material way, is facing challenges in terms of the ability of brands to distinguish themselves from one another. And then when you have the price competition coming on that, it becomes even more challenging.
So, what we’re seeing in terms of the Coach that we launch, first and foremost, new materials, new type of leathers, we are seeing new nylon executions. You will see in the future, new textile executions, PVC executions, much more different branding executions, you’ve seen Nicola especially in the full price, part of the business, which has been well received, leverage a more universal code that is uniquely owned by us, which is the Spade, turning that into hardware, turning that into different lockup executions which are good is going to give us diversity, in the iconography of the brands. And now we’re leveraging all of that into the outlet channel, which we’re really excited about.

是。大。好问题。看,凯特真的有独特的定位。在许多方面,我会说,首先从成瘾的角度来看,绝对考虑时尚,并且因为它更加依赖传统和其他配件类别的成衣,包括珠宝技术,更多年轻的SKU,更多千禧年比教练。而且我会说,手袋空间非常强大,非常强大,现在我在北美这里说话,因为我们非常处于日本国外建立这项业务的早期阶段,非常强大郊区消费者认为这是一种关键的磨损工作资源,我们真正专注于提供这种功能。我认为,相对于Coach和Kate之间的差异,团队是完全分开的,Nicola和[音频不清晰],他们没有进来看看Stuart的Coach系列,Stuart没有过去和Kate系列一起,显然在时尚界他们遵循一般趋势,但我认为你会看到,无论是产品和功能,你会去全价店,它可能是一个访问他们对面的好地方彼此在曼哈顿的Hudson Yards购物中心,在那里你可以看到教练和凯特。凯特的经验和教练的经历非常非常不同。凯特用她非常具体的女性气质代码向她的顾客说话,我将在一分钟内与他人交谈,并以更加都市化的时尚方式为顾客提供服务,我会说斯图尔特对Coach的影响力更大。皮大衣。

如果我们看看凯特和我们推出的代码,我想我在发言中谈到了这一点,就我们在出口渠道中有效竞争的能力而言。凯特传统上依赖于一些非常核心的服装,首先从材料的角度来看,有关于Safiana的事情;从剪影的角度来看,它一直是关于书包和穿着工作类型的风格,从品牌的角度来看,它真的是关于Kate Spade纽约金属锁定,这些产品。这些是传统的代码,它们被许多品牌广泛使用,问题就在于,一个是Safiana,它本身就是一种物质方式,在品牌区别于一个品牌的能力方面面临挑战另一个。然后当你进行价格竞争时,它变得更具挑战性。

所以,我们所看到的就是我们推出的Coach,首先是新材料,新型皮革,我们正在看到新的尼龙处理。您将在未来看到,新的纺织品执行,PVC执行,更多不同的品牌执行,您已经看到Nicola特别是全价,业务的一部分,受到好评,利用一个更独特的更通用的代码由我们拥有的,即Spade,将其转变为硬件,将其转变为不同的锁定执行,这对于我们在品牌的图像中的多样性将会给我们带来多样性。现在我们正在利用所有这些进入出口渠道,我们真的很兴奋。

And I would just say, that’s when we looked at and as you know, [indiscernible] we’ve talked about this a few times in the past, we have an extensive database, we capture north of 85% of customer transactions, across our brands. And what I can share with you is that, the overlap in the database between Coach and Kate Spade consumers is truly less than 5%. So, I’m not as concerned about that at all, as I am about Kate being true to its DNA, yet continue to modernize itself, continuing to give the Kate Spade’s core customer, distinctive newness that she can engage with and that differentiates it from all of the competitive set.

而且我只想说,当我们看到并且如您所知,[音频不清晰]我们过去曾多次谈到这一点,我们有一个广泛的数据库,我们捕获了85%的客户交易,品牌。 我可以与您分享的是,Coach与Kate Spade消费者之间数据库的重叠确实低于5%。 所以,我并不关心这一点,因为我对Kate忠于其DNA,然后继续现代化,继续给予Kate Spade的核心客户,她可以与之接触的独特新颖性,并使其与众不同 来自所有竞争对手。

Oliver Chen

Thank you. Very helpful. Best regards.

谢谢。 很有帮助。 最好的祝福。

Victor Luis

Thank you, Oli.

谢谢你,奥利。

会议主持员

Your next question comes from the line of Mark Altschwager of Baird.

你的下一个问题来自Baird的Mark Altschwager。

Mark Altschwager

Right good morning. Thanks for taking my questions. Just I guess a few quick ones from me, kind of housekeeping here. But what is the share count implied in the flat EPS guide for fiscal 2020? And then how should we be thinking about free cash flow? I guess, based on your current outlook, could you do more than the $300 million on the buyback, without increasing your net leverage ratios? And then finally just hoping you could touch on inventory levels by brand, any pockets of excess inventory that you need to work through in the short run here? Thanks.

对,早上好。 谢谢你回答我的问题。 我想从我这里得到一些快速的东西,在这里管家。 但2020财年平面EPS指南中隐含的份额是多少? 然后我们应该如何考虑自由现金流? 我想,根据您目前的前景,您可以在不增加净杠杆比率的情况下做超过3亿美元的回购吗? 然后最后只是希望你可以按品牌触及库存水平,你需要在短期内完成任何多余的库存? 谢谢。

Andrea Shaw Resnick

Sure. So, Mark, on the share count, think of anything between 282 and 286, depending on when we buy that $300 million worth of stock over the course of the year. We are committing to $300 million right now. And that’s all I think we’re willing to commit to you. And then in terms of your third question on cash flow, could we do more without tripping any leverage issue? Yes, we could, based on our projections of cash flow for the year. On the inventory so inventory was up as you know about 16%. On a two-year stack, I think that was around 8.5% for total Tapestry on pro forma basis, if you include Kate in the two-year comparison. Kate was actually down about 10% over the two-year period, because of the low levels on inventory as we exited 4Q last year, and given the full price selling that we’ve seen and a little bit of delayed delivery.
We had projected it, we saw an increase in-transit, we talked about port congestion last quarter, I would reiterate that now in terms of where that excess is on the lower levels of sales, you can assume obviously that we have a little bit more than we’d like to have on Kate Spade. We are very confident that we can strategically manage through this, it’s going to be a balance on brand health versus promotional activities along we want to be very strategic in that, but we feel good given the currency of the inventory that we can work through that in the first half of the year.

当然。因此,马克,在股票数量上,考虑282和286之间的任何事情,这取决于我们在一年中购买价值3亿美元的股票的时间。我们现在承诺3亿美元。这就是我认为我们愿意承诺给你的全部。然后就你关于现金流量的第三个问题而言,我们能否在不绊倒任何杠杆问题的情况下做更多事情?是的,我们可以根据我们对今年现金流量的预测。在库存上,所以库存增加,因为你知道大约16%。如果你在两年的比较中包括Kate,那么在两年的筹码中,我认为在备考的基础上,Tapestry总数约为8.5%。凯特实际上在两年内下跌了约10%,因为我们去年第四季度的库存水平较低,而且考虑到我们已经看到的全价销售和一些延迟交货。

我们曾预测过它,我们看到运输量有所增加,我们在上个季度讨论过港口拥堵问题,我会重申,现在就销售额较低的地方而言,你可以明显地假设我们有一点点比我们想要的更多Kate Spade。我们非常有信心,我们可以通过这种方式进行战略性管理,这将是品牌健康与促销活动之间的平衡,我们希望在这方面具有战略性,但我们感觉很好,因为我们可以通过我们可以解决的库存货币在今年上半年。

Mark Altschwager

Alright. Thanks, and best of luck.

好的。 感谢和好运。

Victor Luis

Thanks Mark.

谢谢马克。

Andrea Shaw Resnick

Thank you.

谢谢。

会议主持员

Your next question comes from the line of Jamie Merriman of Bernstein.

你的下一个问题来自伯恩斯坦的杰米梅里曼。

Jamie Merriman

Thanks very much. Victor in your comments about Kate, you mentioned some of the initiatives that you have in terms of things like bringing in satchels and cross-body etc. Can you give us a sense of the timing of some of those initiatives, you know given the length of your supply chain and speed, when would you expect those initiatives to start to help? Thanks.

非常感谢。 维克多在你对凯特的评论中,你提到了你带来的一些举措,比如带上书包和斜挎等等。你能不能让我们了解一些这些举措的时机,你知道这个举措的长度 您的供应链和速度,您希望这些计划什么时候开始提供帮助? 谢谢。

Victor Luis

I think in the full price channel really is what I was referring to there, because I do think we’re very much in inventory in that type of style, we don’t have enough diversity in outlet, we don’t have enough diversification in outlet from the material and branding perspective, as well as bringing in, I would say incremental silhouettes to the core satchels where we are very much in inventory and outlet. In full-price there is definitely an opportunity there, and you’re going to see us bring those in fact every month over the next four to five months. We have two to three families launching in the next two to three months, that we expect to be very significant players along with Margot, which today is our key and most successful family in the full-price channel.

我认为在全价通道中确实是我所指的那个,因为我认为我们在这种风格的库存中非常多,我们没有足够的多样性,我们没有足够的多样化 从材料和品牌的角度出发,以及引入,我会说核心书包的增量轮廓,我们非常注重库存和出口。 在全价位上肯定有机会,你会看到我们在接下来的四到五个月内每个月带来这些机会。 我们有两到三个家庭在未来两到三个月内推出,我们期望与Margot一起成为非常重要的参与者,今天是我们在全价通道中的关键和最成功的家庭。

会议主持员

Thank you. That will conclude our Q&A. I will now turn it back over to Victor for some closing remarks.

谢谢。 这将结束我们的问答。 我现在将其转回维克多的一些结束语。

Victor Luis

Thank you everyone for being with us. It’s is our custom, I just want to take the opportunity to thank our teams across the globe for their hard work and dedication, couldn’t be prouder of their commitment in all of their efforts. As we had an amazing year of building the foundation that will certainly serve as the key to our growth for years ahead. I have a tremendous confidence in them and look forward to working and partnering with them to drive growth out of this foundation that we’ve built. Thank you.

谢谢大家和我们在一起。 这是我们的习惯,我只想借此机会感谢我们全球各地的团队的辛勤工作和奉献精神,不能为他们在所有努力中的承诺感到自豪。 因为我们有一个令人惊叹的一年建立基础,这肯定将成为我们未来几年增长的关键。 我对他们非常有信心,期待与他们合作,共同推动我们建立的这个基础的增长。 谢谢。

会议主持员

Thank you. This does conclude today’s Tapestry conference call. You may now disconnect your lines and have a wonderful day.

谢谢。 这确实结束了今天的Tapestry电话会议。 您现在可以断开线路并度过美好的一天。

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