Tapestry, parent company of Coach, Kate Spade and Stuart Weitzman plans to achieve revenue of 8 billion dollars by fiscal year 2025, representing a three-year CAGR of 6 percent to 7 percent.
The company expects to reach earnings per diluted share of over 5 dollars, for a low-to-mid-teens three-year CAGR.
Commenting on the plan, Joanne Crevoiserat, chief executive officer of Tapestry, Inc., said “The environment is ever-changing, and we are ready to move at the speed of the consumer with agility and intention. Importantly, we are confident in our ability to fuel sustainable top and bottom-line gains and generate significant cash flow, creating meaningful value for all our stakeholders in the years to come.”
The company projects Coach revenue growth at a mid-single-digit three-year CAGR to 5.7 billion dollars, while maintaining an operating margin of 30 percent.
Tapestry targets Kate Spade revenue growth at a high-single digit three-year CAGR to 1.9 billion dollars, while expanding operating margin to mid-teens. The company said, brand remains on track to achieve 2 billion in revenue and high-teens operating margin.
Stuart Weitzman revenue growth is expected to be at a low-double digit three-year CAGR to 450 million dollars while expanding operating margin to high-single-digits.
The company’s operating margin is projected in the area of 19 percent, representing expansion of approximately 100 basis points versus FY22.
The company plans cumulative cash return of 3 billion dollars to shareholders by fiscal 2025 supported by a targeted dividend payout ratio of 35 percent to 40 percent and share repurchases of at least 700 million dollars annually.
“We will remain balanced in our approach to fueling revenue gains, operating margin expansion and earnings increases. At the same time, we will continue to be disciplined allocators of capital, with a plan to return 3 billion dollars to shareholders through FY25, supported by our strong free cash flow,” added Scott Roe, chief financial officer and chief operating officer of the company.