Coach Earnings Soar 34%

NEW YORK CITY-Strong sales of its leather handbags and accessories sent third-quarter earnings up 34% at Coach Inc., as full-price comparable sales at its US stores marked the 16th consecutive quarter of double-digit increases.

The New York City-based fashion retailer, which operates more than 500 stores in the US and abroad, said net sales for the period ending April 1 were up 20% to $498 million, an $82-million increase compared to the $416 million reported during the same quarter last year. Earnings per diluted share stood at 28 cents, up from 21 cents a year earlier, beating analysts’ expectations of 27 cents for the quarter. Company execs said they will accelerate new store openings over the next few quarters, adding 12 new US retail shops in the fourth quarter and expanding by at least 85 locations globally during fiscal 2007 to give Coach more than 600 stores by year’s end.

The company, which opened stores in three new US markets and added three retail locations to its Japan operations during the quarter, said direct-to-consumer sales showed a 22% increase for the three-month period, with comparable US store sales rising 21.1%. In Japan, one of the firm’s strongest markets, sales rose 23% on a constant-currency basis.