• Q2 loss narrowed to $4m
  • Gross margin narrows to 58.6%
  • Sales grow 49%

Kate Spade, formerly Fifth & Pacific, has narrowed its net loss in the second quarter thanks to strong performances from its North America and international divisions.

In the three months ended 5 July, net losses amounted to US$4m. This compared to a loss of $43m a year earlier, and is inclusive of a $20m loss related to discontinued operations.

The New York-based company is separating its former Kate Spade reportable segment into two: Kate Spade North America and Kate Spade International. The Adelington Design Group will also be a reportable segment.

Gross margin narrowed to 58.6% in the quarter from 61.8% in the comparable 2013 period.

Total company net sales were up 49% to $266m, while revenues in Kate Spade's North American and international segments grew 55% and 54%, respectively.

COO George Carrara: "We are pleased with our outperformance. Since completing the transition to our newly integrated organisation this quarter, our team is able to cohesively manage our initiatives in a more streamlined, effective way. Currently, we are conducting our annual business planning process and are actively pursuing both existing and newly identified margin expansion opportunities."