Coach Profit Falls 1.6% as North American Store Sales Sink

NEW YORK, United States — Coach Inc., the largest U.S. luxury handbag maker, said fiscal first-quarter profit fell 1.6 percent as stiffer competition curtailed handbag sales in North America.

Net income in the three months ended Sept. 28 dropped to $217.9 million, or 77 cents a share, from $221.4 million, or 77 cents, a year earlier, New York-based Coach said today in a statement. The average of 30 analysts’ estimates compiled by Bloomberg was 76 cents.

Coach's sales at stores open at least a year in North America sank 6.8 percent in the quarter as Michael Kors Holdings Ltd., Fifth & Pacific Cos.' Kate Spade and Tory Burch LLC increased distribution of their own handbag styles. The accessories makers have been competing for market share as American consumers slow spending.

Coach fell 4 percent to $52.02 at 7:15 a.m. in New York. The shares slid 2.4 percent this year through yesterday, compared with a 22 percent gain in the Standard & Poor’s 500 Index.

The North American same-store sales decline was worse than the analysts’ average estimate for a 2.9 percent drop.

Revenue fell 0.9 percent to $1.15 billion, trailing analysts’ $1.19 billion average estimate.

By Cotten Timberlake; Editors: Robin Ajello, Kevin Orland, Tom Lavell