UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 10-K

For the Fiscal Year Ended June 30, 2012

27, 2015OR

Commission file number: 1-16153

516 West 34th34th Street, New York, NY 10001

Securities Registered Pursuant to Section 12(g) of the Act: None

COACH, INC.

TABLE OF CONTENTS

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

27, 2015
OR

516 West 34^th34th Street, New York, NY 10001

UNITED STATES
SECURITES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

FINANCIAL STATEMENTS
For the Fiscal Year Ended June 30, 2012

COACH, INC.

New York, New York 10001

COACH, INC.
CONSOLIDATED BALANCE SHEETS
(amounts in thousands, except share data)

COACH, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(amounts in thousands)

COACH, INC.

Notes to Consolidated Financial Statements

(dollars and shares in thousands, except per share data)

COACH, INC.

Notes to Consolidated Financial Statements (Continued)
(dollars and shares in thousands, except per share data)

FINANCIAL INFORMATION ABOUT SEGMENTS

NARRATIVE DESCRIPTION OF BUSINESS

brand.

SEGMENTS

Direct-to-Consumer Segment

MANUFACTURING

SEASONALITY

sales, including adverse weather conditions.

border protection agencies or by other government agencies which control the quality and safety of Coach’s products. Coach maintains an internal global trade and customs organization to help manage its import/export activity.

Unless the context requires otherwise, references to the "Coach brand" do not include the Stuart Weitzman brand and references to the "Stuart Weitzman brand" do not include the Coach brand.

FISCAL 2012

stores and Internet business. Operating margin decreased 420 basis points to 33.3% in fiscal 2015 from 37.5% during the same period in the prior year due to higher SG&A expense as a percentage of net sales of 390 basis points, primarily due to deleveraging of selling expenses as net sales have declined, and lower gross margin of 50 basis points.

credits.

overall selling expenses as a percentage of net sales which increased by 180 basis points.

fiscal 2013, respectively.

Fiscal 2012 Items

Fiscal 2011 Items

Revolving Credit Facilities

Common Stock Repurchase Program

Liquidity and Capital Resources

Contractual Obligations

Long-Term Debt

further information.

Income Taxes

net operating results.

sales. Refer to Note 3, "Transformation and Other Actions," for charges related to inventory under the Company's Transformation Plan.

2013 as the fair values of our reporting units significantly exceeded their respective carrying values.

Revenue Recognition

which Coach operates. The Company classifies interest and penalties on uncertain tax positions in the provision for income taxes. We record net deferred tax assets to the extent we believe that it is more likely than not that these assets will be realized. In making such determination, we consider all available evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and recent results of operation. We reduce our deferred tax assets by a valuation allowance if, based upon the weight of available evidence, it is more likely than not that some amount of deferred tax assets is not expected to be realized.

an immaterial impact on derivative contract fair values.

27, 2015.

Deferred Compensation

6.next 12 months. This amount will vary due to fluctuations in foreign currency exchange rates.

6. FAIR VALUE MEASUREMENTS – (continued)

9. DERIVATIVE INSTRUMENTS

11.14.8 years for customer relationships, four months for order backlog, and the remaining lease terms ranging from approximately two to 10 years for favorable lease rights.

12.

13. SEGMENT INFORMATION

14. EARNINGS PER SHARE

15.

SPECIAL NOTE ON FORWARD-LOOKING INFORMATION

ITEM 1. BUSINESS

FINANCIAL INFORMATION ABOUT SEGMENTS

NARRATIVE DESCRIPTION OF BUSINESS

brand.

lotion. Coach also offers men's fragrance collections.

SEGMENTS

Direct-to-Consumer Segment

Indirect Segment

MARKETING

MANUFACTURING

MANAGEMENT INFORMATION SYSTEMS

SEASONALITY

sales, including adverse weather conditions.

border protection agencies or by other government agencies which control the quality and safety of Coach’s products. Coach maintains an internal global trade and customs organization to help manage its import/export activity.

ITEM 1A. RISK FACTORS

ITEM 1B. UNRESOLVED STAFF COMMENTS

ITEM 2. PROPERTIES

ITEM 3. LEGAL PROCEEDINGS

ITEM 4. MINE SAFETY DISCLOSURES

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market and Dividend Information

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Unless the context requires otherwise, references to the "Coach brand" do not include the Stuart Weitzman brand and references to the "Stuart Weitzman brand" do not include the Coach brand.

FISCAL 2012

FISCAL 20122015 COMPARED TO FISCAL 2011

Operating Income

credits.

FISCAL 20112014 COMPARED TO FISCAL 2010

Operating Income

overall selling expenses as a percentage of net sales which increased by 180 basis points.

fiscal 2013, respectively.

FISCAL 2012, FISCAL 2011, FISCAL 2009 AND FISCAL 2008 comparability, net income per diluted share decreased 16.9% or $0.63 to $3.10 in fiscal 2014 from $3.73 in fiscal 2013, due to lower net income.

Fiscal 2012 Items

Fiscal 2011 Items

Fiscal 2009 Items

Fiscal 2008 Items

Currency Fluctuation Effects

FINANCIAL CONDITION

Cash Flow

Revolving Credit Facilities

Common Stock Repurchase Program

Liquidity and Capital Resources

Commitments

Contractual Obligations

Long-Term Debt

further information.

Income Taxes

net operating results.

sales. Refer to Note 3, "Transformation and Other Actions," for charges related to inventory under the Company's Transformation Plan.

2013 as the fair values of our reporting units significantly exceeded their respective carrying values.

Revenue Recognition

Share-Based Compensation

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

an immaterial impact on derivative contract fair values.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

ITEM 9A. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

affected.

experienced turnover of several senior management roles and we have focused time and resources on recruiting or promoting from within the new members of our current senior management team. The continued turnover of senior management or the unexpected loss of one or more of our key personnel or any negative public perception with respect to these individuals could also have a material adverse effect on our business, results of operations and financial condition. We do not maintain key-person or similar life insurance policies on any of senior management team or other key personnel.

affected.

We face risks associated with operating

Failure to adequately protect our intellectual property and curb the sale of counterfeit merchandise could injure the brand and negatively affect sales.

Cybercyber security threats, including a privacy or data security breach, could damage our relationships with our customers, harm our reputation, expose us to litigation and adversely affect our business.

Our Indirect segmentbusiness could suffer as a result of consolidations, liquidations, restructurings and other ownership changes in the retail industry.

licensing partners to preserve the value of our licenses and the failure to maintain such partners could harm our business.

Charitable Contributions and Tax Adjustments

Charitable Contributions and Tax Adjustments

Charitable Contributions and Tax Adjustments

Charitable Contributions and Tax Adjustments

Cost Savings Measures

Charitable Contribution and Tax Adjustments

Charitable Contribution and Tax Adjustments

Variable Expenses

This document, and the documents incorporated by reference in this document, in our press releases and in oral statements made from time to time by us or on our behalf, contain certain ~~forward-looking statements~~"forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, and are based on management’s current expectations. These forward-looking statements can be identified by the use of forward-looking terminology such as “believes,” “may,” “will,” “should,” “expect,” “confidence,” “trends,” “intend,” “estimate,” “on track,” “are positioned to,” “on course,” “opportunity,” “continue,” “project,” “guidance,” “target,” “forecast,” “anticipated,” “plan,” “potential,” the negative of these terms or comparable terms. The Company assumes no obligation to revise or update any forward-looking statements for any reason, except as required by law.

Coach, Inc.’s actual results could differ materially from the results contemplated by these forward-looking statements due to a number of important factors, including those discussed in the sections of this Form 10-K filing entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These factors are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of the forward-looking statements contained in this Form 10-K.

Coach’s Hong Kong Depositary Receipts are traded on The Stock Exchange of Hong Kong Limited under the symbol 6388. Neither the Hong Kong Depositary Receipts nor the Hong Kong Depositary Shares evidenced thereby have been or will be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and may not be offered or sold in the United States or to, or for the account of, a U.S. Person (within the meaning of Regulation S under the Securities Act), absent registration or an applicable exemption from the registration requirements. Hedging transactions involving these securities may not be conducted unless in compliance with the Securities Act.

Founded in 1941, Coach Inc. was acquired by Sara Lee Corporation (“Sara Lee”) in 1985. In June 2000, Coach was incorporated in the state of Maryland. In October 2000, Coach was listed on the New York Stock Exchange and sold approximately 68 million shares of common stock, split adjusted, representing 19.5% of the then outstanding shares. In April 2001, Sara Lee completed a distribution of its remaining ownership in Coach via an exchange offer, which allowed Sara Lee stockholders to tender Sara Lee common stock for Coach common stock.

~~In June 2001, Coach Japan was formed~~

Coach’s international expansion strategy is to ~~expand our~~enter into joint ventures and distributor relationships to build market presence ~~in the Japanese~~and capability. To further accelerate brand awareness, aggressively grow market share and to exercise greater control ~~over~~of our brand, ~~in that country.~~Coach has historically acquired its partner’s interests.

In fiscal 2015, the Company has three reportable segments:

North American Retail Stores — Coach retail stores are located in regional shopping centers and metropolitan areas throughout the U.S. and Canada. The retail stores carry an assortment of products depending on their size, location and customer preferences. Our flagship stores, which offer the broadest assortment of Coach products, are located in high-visibility locations.

In ~~connection~~fiscal 2015, we have reduced the number of retail stores and total square footage, as we continue to optimize our real estate position. We expect this trend to continue in the next fiscal year with the ~~fiscal 2011 agreement with the Valiram Group, the Company assumed direct control~~anticipated closure of ~~its domestic~~approximately 15-20 North America retail ~~business~~stores in ~~Malaysia in July 2012. Additionally, in connection with~~ the fiscal ~~2012 agreement with Shinsegae International,~~year ending July 2, 2016 ("fiscal 2016"), attributable to our Transformation Plan, as described in Note 3, "Transformation and Other Actions."

North American Outlet Stores — Coach's outlet stores serve as an efficient means to sell manufactured-for-outlet product, including outlet exclusives, and to a lesser extent, discontinued inventory outside the ~~Company assumed direct control of its~~ retail ~~business~~channel. These stores operate under the Coach name and are geographically positioned primarily in ~~Korea~~established outlet centers that are generally in ~~early August 2012.~~

~~See~~close proximity to major markets.

Coach’s outlet store design, visual presentations and customer service levels support and reinforce the ~~Segment Information note presented~~brand's image. Through these outlet stores, Coach targets value-oriented customers.

The change in the ~~Notes~~number of North America Coach outlet stores and their total and average square footage is shown in the following table:

Over the next few years, we expect to continue to see modest to no growth in outlet store square footage as we continue to optimize our real estate position across channels by expanding our most productive stores to accommodate a broader expression of lifestyle assortment while continuing to assess opportunities to close under-performing stores.

Internet — Coach views its www.coach.com website as a key communications vehicle for the ~~Consolidated Financial Statements.~~

brand to promote traffic in Coach ~~has grown from~~retail stores and department store locations and build brand awareness, as well as an additional channel to sell Coach brand products directly to customers. With approximately 64 million unique visits to www.coach.com in fiscal 2015, our online store provides a ~~family-run workshop in~~showcase environment where consumers can browse through a ~~Manhattan loft to a leading American marketer of fine accessories and gifts for women and men. Coach is one~~selected offering of the ~~most recognized fine accessories brands~~latest styles and colors. Our e-commerce programs also include our invitation-only outlet Internet sales site, where we have considerably reduced the number of promotional events since fiscal 2014.

North America Wholesale — Coach began as a U.S. wholesaler to department stores and this channel continues to remain a part of our overall consumer reach. Today, we work closely with our partners to ensure a clear and consistent product presentation. Coach enhances its presentation through the creation of shop-in-shops with proprietary Coach fixtures within the department store environment. Coach custom tailors its assortments through wholesale product planning and allocation processes to match the attributes of our department store consumers in each local market. Coach continues to closely manage inventories in this channel given the highly promotional environment at point-of-sale. Coach utilizes automatic replenishment with major accounts in an effort to optimize inventory across wholesale doors. Over the next year, we expect to continue investing in the elevation of shop-in-shop environments.

Coach brand's products are sold in approximately 1,000 wholesale locations in the U.S. and Canada. Our most significant U.S. wholesale customers are Macy’s (including Bloomingdale's), Dillard's, Nordstrom, Lord & Taylor, The Bay, Bon Ton, Belk and Von Maur. Coach products are also available on these customers' websites.

Our International Markets operate department store concession shop-in-shop locations and freestanding flagship, retail and outlet stores as well as e-commerce websites. Flagship stores, which offer the broadest assortment of Coach products, are located in ~~targeted~~select high-visibility shopping districts.

The following table shows the number of international ~~markets.~~ directly-operated locations and their total and average square footage:

We ~~offer premium lifestyle accessories~~expect our International segment to ~~a loyal~~reflect modest growth in store count over the next few years, particularly within mainland China and growing customer base and provide consumers with fresh, relevant and innovative products that are extremely well made, at an attractive price. Coach’s modern, fashionable handbags and accessories use a broad range of high quality leathers, fabrics and materials.Europe.

International Wholesale — In ~~response~~addition to our ~~customer’s demands for both fashion~~company-operated stores, this channel includes sales to international wholesale distributors and ~~function, Coach offers updated styles and multiple product categories which address an increasing share~~authorized retailers. Travel retail represents the largest portion of our ~~customer’s accessory wardrobe.~~customers’ sales in this channel. However, we continue to drive growth by expanding our distribution to reach local consumers in new markets. Coach has developed relationships with a select group of distributors who sell Coach products through department stores and freestanding retail locations in approximately 45 countries. Coach's current network of international distributors serve the following domestic and/or travel retail markets: Argentina, Australia, Austria, Bahamas, Bahrain, Benelux, Brazil, Canada, Chile, Greater China, Colombia, Denmark, Dominican Republic, Finland, France, Germany, Indonesia, Italy, Japan, South Korea, Kuwait, Lebanon, Malaysia, Mexico, New Zealand, Norway, Panama, Peru, Philippines, Portugal, Qatar, Saudi Arabia, Singapore, Spain, Sweden, Switzerland, Taiwan, Thailand, the United Arab Emirates, the United Kingdom, Uruguay, U.S. & Territories, Venezuela and Vietnam.

For locations not in freestanding stores, Coach has created ~~a sophisticated, modern~~shop-in-shops and ~~inviting environment~~other image enhancing environments to ~~showcase our product assortment~~increase brand appeal and ~~reinforce a consistent~~stimulate growth. Coach continues to improve productivity in this channel by opening larger image-enhancing locations, expanding existing stores and closing less productive stores. Coach's most significant international wholesale customers are the DFS Group, Everrich DFS Corp, Lotte Group, Shilla Group and Vantage Point. Coach's products are sold in approximately 430 wholesale locations.

Stuart Weitzman — The Stuart Weitzman brand position wherever the consumer may shop. We utilize a flexible, cost-effective global sourcing model, in which independent manufacturers supply our products, allowing us to bring our broad range of products to market rapidly and efficiently.

~~Coach offers a number of key differentiating elements that set it apart from the competition, including:~~

~~A Distinctive Brand~~ ~~— Coach offers distinctive, easily recognizable, accessible luxury products that are relevant, extremely well made and provide excellent value.~~

Licensing — In our worldwide licensing relationships, Coach takes an active role in the ~~Internet. Beginning~~design process and controls the marketing and distribution of products under the Coach brand. Licensing revenue was approximately $31.9 million and $27.9 million in fiscal 2015 and fiscal 2014, respectively. Our key licensing relationships as of June 27, 2015 are as follows:

Products made under license are, in most cases, sold through all of the channels discussed above and, with the ~~first quarter of fiscal 2013, this channel also includes Coach-operated stores~~Company's approval, these licensees have the right to distribute products selectively through several other channels, including: shoes in ~~Malaysia and Korea. The Indirect channel provides us with access to consumers via wholesale~~ department store salons, watches in selected jewelry stores and ~~specialty store locations~~eyewear and sunwear in ~~over 20 countries.~~

~~Innovation And A Consumer-Centric Focus~~ —selected optical retailers. These venues provide additional, yet controlled, exposure of our brands. Our licensing partners pay royalties on their net sales of our branded products. However, such royalties are not material to our business as they currently comprise less than 1% of the Company's total net sales. The licensing agreements generally give Coach ~~listens~~the right to ~~its consumer through rigorous consumer research~~terminate the license if specified sales targets are not achieved.

The Other segment also consists of sales generated in ancillary channels.

See Note 16, "Segment Information" for more information about all segments.

The following discussion - including "Products," "Design and ~~strong consumer orientation.~~Merchandising," "Marketing," "Manufacturing," "Distribution," "Information Systems," "Trademarks and Patents," "Seasonality," "Government Regulation," "Competition" and "Employees" - is based on the Coach ~~works to anticipate the consumer’s changing needs by keeping the product assortment fresh and relevant.~~

We believe that these differentiating elements have enabled the Company to offer a unique proposition to the marketplace. We hold the number one position within the U.S. premium handbag and accessories market and the number two position within the Japanese imported luxury handbag and accessories market.

Coach brand’s primary product offerings, manufactured by third-party suppliers, include women’s and men’s bags, small leather goods, footwear, business cases, ready-to-wear including outerwear, watches, weekend and travel accessories, ~~wearables, footwear,~~scarves, sunwear, fragrance, jewelry, ~~sunwear,~~ travel bags ~~watches~~ and ~~fragrance.~~other lifestyle products. The following table shows ~~the percent of~~ net sales ~~that~~for each product category ~~represented:~~

represented for the Coach brand (in millions):

During fiscal 2015, the Company reevaluated its product categories and determined that small accessory handbags and travel bags, which were previously classified as "Women's Accessories" and "All Other Products," respectively, are viewed by management to be part of its "Women's Handbag" product category. Prior periods have been adjusted to reflect the current period classification.

Women’s Handbags — Women’s handbag collections feature classically inspired designs as well as fashion designs. Typically, there are three to four collections per quarter and four to seven styles per collection. These collections are designed to meet the fashion and functional requirements of our broad and diverse consumer base.

Women’s Accessories — Women’s accessories include small leather goods and novelty accessories. Women’s small leather goods, which complement our handbags, include money pieces, wristlets and cosmetic cases. Key rings and charms are also included in this category.

Men’s — Men’s ~~handbag~~bag collections include business cases, computer bags, messenger-style bags and totes. In fiscal 2012, we introduced the new Hamptons Weekend and Willis collections, and made updates to our Poppy, Madison and Kristin collections. In early fiscal 2013, we launched a new dual-gender Legacy lifestyle collection, inspired by our heritage, grounded in leather and featuring distinctive Coach elements. Legacy, our largest product launch in many years, is an iconic lifestyle collection which provides a foundation for the brand, targeting multi-generational consumers whom are both classic and stylish in their preferences.

~~Accessories~~ — Accessories include women’s and men’s small leather goods, novelty accessories and women’s and men’s belts. Women’s small leather goods, which coordinate with our handbags, include money pieces, wristlets, and cosmetic cases. Men’s small leather goods consist primarily of wallets, card cases and ~~card cases.~~belts. Novelty accessories include time management and electronic accessories. ~~Key rings and charms are also included in this category.~~

~~Wearables~~ ~~— This category is comprised~~

All Other Products (excluding the Stuart Weitzman brand) consist of ~~scarves, jackets, gloves and hats, including both cold weather and fashion. The assortment is primarily women's and contains a fashion assortment in all components of this category.~~

the following:

Coach brand's design team, led by ~~its~~the Executive Creative Director, Stuart Vevers, is responsible for conceptualizing and directing the design of all ~~Coach~~ products. Designers have access to Coach's extensive archives of product designs created ~~over the past 70 years,~~since Coach's inception, which are a valuable resource for new product concepts. ~~Coach~~Our designers are also supported by a strong merchandising team that analyzes sales, market trends and consumer preferences to identify ~~business~~market opportunities that help guide each season's design ~~process.~~process and create a globally relevant product assortment. Merchandisers also ~~analyze products~~manage the product life cycle to maximize sales and ~~edit, add and delete to achieve profitable sales~~profitability across all channels. The product category teams, each comprised of design, merchandising/product development and sourcing specialists help the Coach brand execute design concepts that are consistent with the brand's strategic direction.

~~Coach's~~

Our design and merchandising teams work in close collaboration with all of our licensing partners to ensure that the licensed products (watches, footwear, eyewear and fragrance) are conceptualized and designed to address the intended market opportunity and convey the distinctive perspective and lifestyle associated with ~~the~~ our brands.

Coach ~~brand.~~

During fiscal 2008, the Company announced a new business initiative to drive brand creativity. This initiative has evolved into the Reed Krakoff brand, representing New American luxury, which is supported by a team of experienced designers and merchandisers and encompasses all women’s categories, with a focus on ready-to-wear, handbags, accessories, footwear and jewelry. We introduced the Reed Krakoff brand with store openings in North America and internationally through specialty retailers in early fiscal 2011.

~~Coach operates in two reportable segments: Direct-to-Consumer and Indirect. The reportable segments represent channels of distribution that offer similar products, service and marketing strategies.~~

The Direct-to-Consumer segment consists of channels that provide us with immediate, controlled access to consumers: Coach-operated stores in North America; Japan; Hong Kong, Macau, and mainland China; Taiwan; Singapore and the Internet. This segment represented approximately 89% of Coach's total net sales in fiscal 2012, with North American stores and the Internet, Coach Japan and Coach China contributing

In conjunction with promoting a consistent global image, Coach uses its extensive customer database and consumer knowledge to target specific products and communications to specific consumers to efficiently stimulate sales across all distribution channels.

Coach engages in several consumer communication initiatives, including direct marketing activities and national, regional and local advertising. In fiscal 2012, consumer contacts increased 131% to over 1.4 billion primarily driven by increased email communications. The Company continues to leverage marketing expenses by refining our marketing programs to increase productivity and optimize distribution. Total expenses ~~related~~attributable to ~~consumer communications~~Coach brand marketing-related events in fiscal ~~2012~~2015 were ~~$89.2~~$158.9 million, ~~representing less than 2%~~or approximately 4% of net sales, compared to $130.1 million in fiscal 2014, or approximately 3% of net sales.

~~Coach’s~~

Coach's wide range of direct marketing activities includes email contacts and ~~brochures~~catalogs targeted to promote sales to consumers in their preferred shopping venue. In addition to building brand awareness ~~the coach.com~~ and ~~reedkrakoff.com~~driving online revenue, Coach's websites serve as an effective brand ~~communications vehicles~~communication vehicle by providing a showcase environment where consumers can browse through a strategic offering of the latest styles and colors, which drives store traffic and enables the collection of customer data.

As part of the Coach's direct marketing strategy, ~~the Company uses its database~~we use databases primarily consisting of approximately 2228 million ~~active~~ households in North America, ~~and 6.6~~approximately 11 million ~~active~~ households in ~~Japan.~~Asia and approximately 380,000 households in Europe. Email contacts and ~~catalogs~~direct mail pieces are an important part of Coach's ~~principal means of~~ communication and are sent to selected households to stimulate consumer purchases and build brand awareness. ~~The growing number of visitors~~Visitors to ~~the coach.com~~Coach's e-commerce sites in the U.S., Canada, Japan and ~~Japan provides~~China provide an opportunity to increase the size of these ~~databases.~~

~~During fiscal 2012, the Company sent approximately 1.2 billion emails to strategically selected customers~~databases, as ~~we continue to evolve our internet outreach to maximize productivity while streamlining distribution.~~ well as point of sale transactions globally except where restricted.

In fiscal ~~2012, the Company distributed over one million catalogs~~2015, Coach had informational websites in ~~Coach stores in Japan;~~Brazil, Chile, Colombia, Mexico, Panama, Peru, Venezuela, Australia, Hong Kong, ~~Macau and mainland China; and~~Indonesia, Korea, Malaysia, New Zealand, Singapore, Taiwan, ~~and Singapore. The Company also mailed over one million additional catalogs to households throughout Asia, including over 700,000 in China.~~

The ~~Company~~Coach brand also runs national, regional and local ~~advertising~~marketing campaigns in support of its major selling seasons.

~~While all of our~~ In fiscal 2014, Coach refreshed its strategy to expand its marketing campaigns to more clearly message its brand and products ~~are manufactured by independent manufacturers, we nevertheless maintain control of the supply chain process from design through manufacture.~~under an effortless New York style positioning. We ~~are able~~plan to docontinue to support this by qualifying raw material suppliers and by maintaining sourcing and product development offices in China, Hong Kong, Vietnam, South Korea and India that work closely with our independent manufacturers. This broad-based, global manufacturing strategy is designed to optimize the mix of cost, lead times and construction capabilities. Over the last several years, we have increased the presence of our senior management at our manufacturers’ facilities to enhance control over decision making and ensure the speed with which we bring new product to market is maximized.

These independent manufacturers support a broad mix of product types, materials and a seasonal influx of new, fashion oriented styles, which allows us to meet shifts in marketplace demand and changes in consumer preferences. During fiscal 2012, approximately 71% of Coach's total net sales were generated from newly introduced products with no sales in the ~~same quarter the previous year. As the collections are seasonal~~future through an increased presence in relevant fashion, media events and ~~planned to be sold in stores for short durations, our production quantities are limited which lowers our exposure to excess and obsolete inventory.~~

All product sources, including independent manufacturers and licensing partners, must achieve and maintain Coach's high quality standards, which are an integral part of the Coach identity. One of Coach's keys to success lies in the rigorous selection of raw materials. Coach has longstanding relationships with purveyors of fine leathers and hardware. Although Coach products are manufactured by independent manufacturers, we maintain control of the raw materials that are used in all of our products. Compliance with quality control standards is monitored through on-site quality inspections at all independent manufacturing facilities.

publications.

Coach carefully balances its commitments to a limited number of “better brand” partners with demonstrated integrity, quality and reliable delivery. Our manufacturers are located in many countries, including Vietnam, mainland China, the Philippines, India, Thailand, Italy, ~~United States, Vietnam,~~ Hong Kong, ~~India, Thailand, Philippines, Taiwan~~Myanmar and ~~Peru.~~the United States. Coach continues to evaluate new manufacturing sources and geographies to deliver the finest quality products at the lowest cost and help limit the impact of manufacturing in inflationary markets. During fiscal ~~2012, one vendor~~2015, the Coach brand had two vendors who each provided ~~approximately 16%~~slightly over 10% of ~~Coach’s~~the Company's total units. These two vendors are geographically dispersed and have multiple locations in different countries. No other individual vendor currently provides more than approximately ~~11%~~10% of Coach’s total units. Before partnering with a vendor, Coach evaluates each facility by conducting a quality and business practice standards audit. Periodic evaluations of existing, previously approved facilities are conducted on a random basis. We believe that all of our manufacturing partners are in material compliance with Coach’s integrity standards.

These independent manufacturers each or in aggregate support a broad mix of product types, materials and a seasonal influx of new, fashion oriented styles, which allows us to meet shifts in marketplace demand and changes in consumer preferences.

Our raw material suppliers, independent manufacturers and licensing partners, must achieve and maintain high quality standards, which are an integral part of our identity. One of Coach's keys to success lies in the rigorous selection of raw materials. Coach has longstanding relationships with purveyors of fine leathers and hardware. Although Coach products are manufactured by independent manufacturers, we maintain a level of oversight in the selection of the raw materials that are used in all of our products. Compliance with quality control standards is monitored through on-site quality inspections at all independent manufacturing facilities.

We maintain control of the supply chain process from design through manufacture. We are able to do this by qualifying raw material suppliers and by maintaining sourcing management offices in Vietnam, Greater China, Hong Kong and the Philippines that work closely with our independent manufacturers. This broad-based, global manufacturing strategy is designed to optimize the mix of cost, lead times and construction capabilities.

In North America, the Company operates an 850,000 square foot distribution and consumer service facility in Jacksonville, ~~Florida.~~Florida for Coach brand products. This automated facility uses a bar code scanning warehouse management system. Coach's distribution center employees use handheld ~~radio frequency~~ scanners to read product bar codes, which allow them to more accurately process and pack orders, track shipments, manage inventory and generally provide excellent service to our customers. ~~Coach's~~Coach brand products are primarily shipped to Coach retail stores and wholesale customers via express delivery providers and common carriers, and direct to consumers via express delivery providers.

~~To support our growth~~

Outside of North America, the Company has established regional distribution centers, through third-parties, in Shanghai, China and ~~the region, in fiscal 2010 we established an Asia distribution center in Shanghai, owned and operated by a third-party, allowing us to better manage the logistics in this region while reducing costs.~~Oldenzaal, The ~~Company~~Netherlands for Coach brand products. Coach also operates alocal distribution ~~center,~~centers, through ~~a third-party,~~third-parties, in ~~Japan.~~

Japan, China, Hong Kong, South Korea, Taiwan, Malaysia, Singapore and Macau for Coach brand products.

The foundation of Coach's information systems is its Enterprise Resource Planning (“ERP”) system. This ~~fully~~ integrated system supports ~~all aspects of~~ finance and accounting, procurement, inventory control, sales and store replenishment. The system functions as a central repository for ~~all of~~ Coach's transactional information, resulting in increased efficiencies, improved inventory control and a better understanding of consumer demand. ~~This system was upgraded in fiscal 2008, continues to be the most current version available, and is fully scalable to accommodate growth.~~

Complementing its ERP system are several other system solutions, each of which Coach believes is ~~well suited~~suitable for its needs. The data warehouse system summarizes the transaction information and provides a ~~single~~global platform for ~~all~~ management reporting. The supply chain management ~~system supports sales and~~systems support product development, procurement, inventory planning and reporting functions. ~~Product~~In North America, product fulfillment is facilitated by Coach's highly automated warehouse management system and electronic data interchange system, while the unique requirements of Coach's ~~internet~~Internet business are supported by Coach’s order management ~~system. Finally,~~and e-commerce systems. Internationally, Coach selectively relies on the warehouse and distribution systems owned by the third-parties that operate certain of our international distributions centers. Additionally, the point-of-sale system supports all in-store transactions, distributes management reporting to each store, and collects sales and payroll information on a daily basis. This daily collection of store sales and inventory information results in early identification of business trends and provides a detailed baseline for store inventory replenishment. Updates and upgrades of these systems are made on a periodic basis in order to ensure that we constantly improve our functionality. ~~All complementary systems are integrated with the central ERP system.~~

Coach owns all of the material worldwide trademark rights used in connection with the production, marketing and distribution of all of its ~~products, both~~products. In addition, it licenses trademarks and copyrights used in connection with the ~~U.S.~~production, marketing and ~~in other countries in which the products are principally sold.~~distribution of certain categories of goods and limited edition collaborative special projects. Coach also owns and maintains worldwide registrations for trademarks in all relevant classes of products in each of the countries in which ~~Coach~~our products are sold. Major trademarks include~~Coach, Coach~~ COACH, COACH NEW YORK, COACH and ~~lozenge design, Coach~~Horse & Carriage Design, COACH and ~~tag design,~~Story Patch Design, COACH and Lozenge Design, COACH and Tag Design, Signature C ~~design, Coach~~Design, and Op Art ~~design~~C Design and ~~The Heritage Logo (Coach Leatherware Est. 1941)~~COACH LEATHERWARE EST. 1941 (the "Heritage Logo"). Coach is not dependent on any one particular trademark or design patent although Coach believes that the Coach name is important for its business. In addition, several of Coach's products are covered by design patents orand a utility patent ~~applications.~~application. Coach aggressively polices its trademarks and trade dress, and pursues infringers both domestically and internationally. It also pursues counterfeiters domestically and internationally through leads generated internally, as well as through its network of investigators, the Coach hotline and business partners around the world.

Coach expects that its material trademarks will remain in ~~existence~~full force and effect for as long as ~~Coach continues~~we continue to use and renew them.

Because Coach ~~has no material patents.~~

~~Because Coach~~brand's products are frequently given as gifts, ~~Coach has historically realized,~~we experience seasonal variations in net sales, operating cash flows and ~~expects~~working capital requirements, primarily related to ~~continue to realize,~~seasonal holiday shopping. During the first fiscal quarter, we build inventory for the holiday selling season. In the second fiscal quarter, working capital requirements are reduced substantially as we generate higher net sales and operating income, ~~in the second quarter of its fiscal year, which includes~~especially during the holiday months of November and December. ~~In addition, fluctuations~~Fluctuations in net sales, operating income and operating ~~income~~cash flows in any fiscal quarter ~~are~~may be affected by ~~the timing of seasonal wholesale shipments and~~ other events affecting retail ~~sales. Over the last several years, we have achieved higher levels of growth in the non-holiday quarters, which has reduced these seasonal fluctuations.~~

Most of Coach's imported products are subject to ~~existing or potential~~ duties, ~~tariffs or~~indirect taxes, quotas and non-tariff trade barriers that may limit the quantity of products that Coach may import into the U.S. and other countries or may impact the cost of such products. Coach ~~has~~is not ~~been~~materially restricted by quotas or other government restrictions in the operation of its business, ~~and~~however customs duties ~~have not comprised~~do represent a material ~~portion~~part of ~~the~~ total ~~cost of its products. In addition,~~product cost. To maximize opportunities, Coach operates complex supply chains through foreign trade zones, bonded logistic parks and other strategic initiatives such as free trade agreements. Additionally, Coach operates a direct import business in many countries worldwide. As a result, Coach is subject to ~~foreign governmental regulation~~stringent government regulations and ~~trade~~ restrictions ~~including retaliation against certain prohibited foreign practices,~~ with respect to its ~~product sourcing~~cross-border activity either by the various customs and ~~international sales operations.~~

The premium handbag, footwear and accessories industry is highly competitive. ~~The Company mainly~~Coach competes primarily with European and American luxury and accessible luxury brands as well as private label retailers, including some of ~~Coach’s~~

As of June ~~30, 2012,~~27, 2015, Coach brand employed approximately ~~18,000 people,~~15,800 globally, including both full and part time employees, but excluding seasonal and temporary employees. Of these employees, approximately ~~6,200~~7,400 and ~~8,000~~5,700 were full time and part time employees, respectively, in the global retail ~~field in North America; Japan; Hong Kong, Macau, and mainland China; Taiwan; Singapore and Korea. Approximately 70 of Coach’s employees are covered by collective bargaining agreements.~~field. Coach believes that its relations with its employees are good, and it has never encountered a strike or work stoppage.

See the ~~Segment Information note~~Note 16, "Segment Information" presented in the Notes to the Consolidated Financial Statements for geographic information.

Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, are available free of charge on our investor website, located at~~www.coach.com~~www.coach.com/investors under the caption “SEC Filings”, as soon as reasonably practicable after they are filed with or furnished to the Securities and Exchange Commission. These reports are also available on the Securities and Exchange Commission’s website atwww.sec.gov. No information contained on any of our websites is intended to be included as part of, or incorporated by reference into, this Annual Report on Form 10-K.

The Company has included the Chief Executive Officer (“CEO”) and Chief Financial Officer certifications regarding its public disclosure required by Section 302 of the Sarbanes-Oxley Act of 2002 as Exhibit 31.1 to this report on Form 10-K. Additionally, the Company filed with the New York Stock Exchange (“NYSE”) the CEO’s certification regarding the Company’s compliance with the NYSE’s Corporate Governance Listing Standards (“Listing Standards”) pursuant to Section 303A.12(a) of the Listing Standards, which indicated that the CEO was not aware of any violations of the Listing Standards by the Company.

During the fourth quarter of fiscal 2014, we announced a multi-year strategic plan with the objective of transforming the brand and reinvigorating growth, which will enable the Company to return to ‘best-in-class’ profitability. Key operational and cost elements in order to fund and execute this plan include: (i) the investment in capital improvements in our stores and wholesale locations to drive comparable sales improvement; (ii) the optimization and streamlining of our organizational model as well as the closure of underperforming stores in North America, and select International stores, (iii) the realignment of inventory levels and mix to reflect our elevated product strategy and consumer preferences; (iv) the investment in incremental advertising costs to elevate consumer perception of our brand, drive sales growth and promote our new strategy; and (v) the significant scale-back of our promotional cadence in an increased global promotional environment, particularly within our outlet Internet sales site. The Company believes that long-term growth can be realized through its transformational efforts over time. There is no assurance that such efforts will be successful in achieving long-term growth or changing the perception of the Company from an accessories brand to a global lifestyle brand. Furthermore, actual costs incurred under the Transformation Plan may differ from expectations based on our execution of the key operational and cost elements described above. Refer to Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Note 3, "Transformation and Other Actions," for further information regarding the Transformation Plan.

If the execution of our transformation plan falls short, our business, financial condition and results of operation could be materially adversely ~~affect our financial condition, results of operations and consumer purchases of luxury items.~~

The current uncertain global economic conditions are having a significant negative impact on businesses around the world. Our results can be impacted by a number of macroeconomic factors, including but not limited to consumer confidence and spending levels, unemployment, consumer credit availability, raw materials costs, fuel and energy costs, global factory production, commercial real estate market conditions, credit market conditions and the level of customer traffic in malls and shopping centers.

Demand for our products, and consumer spending in the premium handbag and accessories market generally, is significantly impacted by trends in consumer confidence, general business conditions, interest rates, the availability of consumer credit, and taxation. Consumer purchases of discretionary luxury items, such as Coach products, tend to decline during recessionary periods, when disposable income is lower. The general economic conditions in the economy may continue to affect consumer purchases of our products for the foreseeable future and adversely impact our results of operations.

Our growth depends on the continued success of existing products, as well as the successful design and introduction of new products. Our ability to create new products and to sustain existing products is affected by whether we can successfully anticipate and respond to consumer preferences and fashion trends. The failure to develop and launch successful new products could hinder the growth of our business. Also, any delay in the development or launch of a new product could result in our company not being the first to bring product to market, which could compromise our competitive position.

Additionally, our current growth strategy includes plans to expand in a number of international regions, including Asia and Europe. We currently plan to open additional Coach and Stuart Weitzman stores in mainland China, Europe and other international markets, both directly and through strategic partners. Our brands may not be well-established or widely sold in some of these markets, and we may have ~~entered into strategic agreements~~limited experience operating directly or working with ~~various~~our partners ~~to expand our operations in Europe.~~there. In addition, we have recently taken control of certain of our retail operations in the Asia-Pacific region, including Taiwan, Malaysia and South Korea during calendar year 2012. We do not yet have significant experience directly operating in these countries, and in many of ~~them we face established competitors. Many of~~ these ~~countries~~markets have different operational characteristics, including but not limited to employment and labor, transportation, logistics, real estate, environmental regulations and local reporting or legal requirements.

Furthermore, consumer demand and behavior, as well as tastes and purchasing trends may differ in these countries, and as a result, sales of our product may not be successful, or the margins on those sales may not be in line with those we currently anticipate. Further, such markets will have upfront short-term investment costs that may not be accompanied by sufficient revenues to achieve typical or expected operational and financial performance and therefore may be dilutive to Coach in the short-term. In many of these countries, there is significant competition to attract and retain experienced and talented employees. If

Consequently, if our international expansion plans are unsuccessful, or we are unable to retain and/or attract key personnel, our business, financial condition and results of operation could be materially adversely affected.

We operate on a global basis, with approximately 39% of our net sales coming from operations outside of North America. While geographic diversity helps to reduce the Company’s exposure to risks in any one country, we are subject to risks associated with international operations, including, but not limited to:

Our results can be impacted by a number of macroeconomic factors, including but not limited to consumer confidence and spending levels, unemployment, consumer credit availability, raw materials costs, fuel and energy costs (including oil prices), global factory production, commercial real estate market conditions, credit market conditions and the level of customer traffic in malls and shopping centers.

Demand for our products, and consumer spending in the premium handbag and accessories market generally, is significantly impacted by trends in consumer confidence, general business conditions, interest rates, foreign currency exchange rates, the availability of consumer credit, and taxation. Consumer purchases of discretionary luxury items, such as the Company's products, tend to decline during recessionary periods or periods of sustained high unemployment, when disposable income is lower. Unfavorable economic conditions may also reduce consumers’ willingness and ability to travel to major cities and vacation destinations in which our stores are located.

During fiscal 2015, we acquired Stuart Weitzman Holdings, LLC, a leading designer and manufacturer of women's luxury footwear. We may have difficulty integrating the Stuart Weitzman business into our operations or otherwise successfully managing the expansion of the Stuart Weitzman business. Additionally, while we continually review potential acquisition opportunities, there can be no assurance that we will be able to identify suitable candidates or consummate these transactions on favorable terms or at all. The potential difficulties of integrating the operations of an acquired business, such as Stuart Weitzman, and realizing our expectations for an acquisition, including the benefits that may be realized, include, among other things:

Our failure to successfully complete the integration of any acquired business, including Stuart Weitzman, and any adverse consequences associated with future acquisition activities, could have an adverse effect on our business, financial condition and operating results.

Completed acquisitions may result in additional goodwill and/or ~~economic instability~~an increase in other intangible assets on our balance sheet. We are required at least annually, or ~~changing macroeconomic conditions in our major markets,~~

We depend on digital technologies for the successful operation of our business, including corporate email communications to and from employees, customers and stores, the design, manufacture and distribution of our finished goods, digital marketing efforts, collection and retention of customer data, employee information, the processing of credit card transactions, online e-commerce activities and our interaction with the public in the social media space. The possibility of a cyber-attack on any one or all of these systems is a serious threat. The retail industry, in particular, has been the target of many recent cyber-attacks. As part of our business model, we collect, retain, and transmit confidential information over public networks. In addition to our own databases, we use third party service providers to store, process and transmit this information on our behalf. Although we contractually require these service providers to implement and use

Awareness and sensitivity to privacy breaches and cyber security threats by consumers, employees and lawmakers is at an all-time high. Any misappropriation of confidential or personally identifiable information gathered, stored or used by us, be it intentional or accidental, could have a material impact on the operation of our business, including severely damaging our reputation and our relationships with our customers, employees and investors. We may also incur significant costs implementing additional security measures to protect against new or enhanced data security or privacy threats, or to comply with state, federal and international laws governing the unauthorized disclosure of confidential information as well as increased cyber security protection costs such as organizational changes, deploying additional personnel and protection technologies, training employees, and engaging third party experts and consultants and lost revenues resulting from unauthorized use of proprietary information including our

In addition, we maintain e-commerce sites in the U.S., Canada, Japan and China and have plans for additional e-commerce sites in other parts of the world. Additionally, Coach has informational websites in various countries, as described in Item I, "Business." Lastly, our e-commerce programs also include an invitation-only Coach outlet flash sale site. Given the robust nature of our e-commerce presence and digital strategy, it is imperative that we and our e-commerce partners maintain uninterrupted operation of our: (i) computer hardware, (ii) software systems, (iii) customer marketing databases, and (iv) ability to email our current and potential customers. Despite our preventative efforts, our systems are vulnerable from time-to-time to damage, disruption or interruption from, among other things, physical damage, natural disasters, inadequate system capacity, system issues, security breaches, email blocking lists, computer viruses or power outages. Any material disruptions in our e-commerce presence or information technology systems could have a material adverse effect on our business, financial condition and results of operations.

We believe that the Coach brand, established almost 75 years ago, is regarded as America's preeminent designer, producer, and marketer of fine accessories and gifts for women and men. We attribute the prominence of the Coach brand to the unique combination of our original American attitude and design, our heritage of fine leather goods and custom fabrics, our superior product quality and durability and our commitment to customer service. Furthermore, the Stuart Weitzman brand is viewed as a leading design house of women's luxury footwear within North America, with a strong opportunity for growth globally, and is built upon the idea of crafting a beautifully-constructed shoe, merging fashion and function. Any misstep in product quality or design, customer service, marketing, unfavorable publicity or excessive product discounting could negatively affect the image of our brands with our customers. Furthermore, the product lines we have historically marketed and those that we plan to market in the future are becoming increasingly subject to rapidly changing fashion trends and consumer preferences, including the increasing shift to digital brand engagement and social media communication. If we do not anticipate and respond promptly to changing customer preferences and fashion trends in the design, production, and styling of our products, as well as create compelling marketing campaigns that appeal to our customers, our sales and results of operations may be negatively impacted. Our success also depends in part on our ability to execute on our Transformation Plan. Even if our products, marketing campaigns and retail environments do meet changing customer preferences and/or stay ahead of changing fashion trends, our brand image could become tarnished or undesirable in the minds of our customers or target markets, which could materially adversely impact our business, financial condition, and results of operations.

We monitor our global foreign currency exposure. In order to minimize the impact on earnings of foreign currency rate movements, we hedge our subsidiaries’ U.S. dollar-denominated inventory purchases in Japan and Canada, as well as the Company's cross currency denominated intercompany loan portfolio. We cannot ensure, however, that these hedges will fully offset the impact of foreign currency rate movements. Additionally, our international subsidiaries primarily use local currencies as the functional currency and translate their financial results from the local currency to U.S. dollars. If the U.S. dollar strengthens against these subsidiaries’ foreign currencies, the translation of their foreign currency denominated transactions may decrease consolidated net sales and profitability. Our continued international expansion will increase our exposure to foreign currency fluctuations. Sales to our international wholesale customers are primarily denominated in U.S. dollars.

As a result of operating retail stores outside of the U.S., we are also exposed to market risk from fluctuations in foreign currency exchange rates. A substantial weakening of foreign currencies against the U.S. dollar could impact consumers’ willingness or ability to travel abroad and/or purchase our products while traveling, as well as require us to raise our retail prices or reduce our profit margin in various locations outside of the U.S. In addition, our sales and profitability could be negatively impacted if consumers in those markets were unwilling to purchase our products at increased prices.

Our business and long-range planning process is designed to maximize our long-term strength, growth, and profitability, and not to achieve an earnings target in any particular fiscal quarter. We believe that this longer-term focus is in the best interests of the Company and our stockholders. At the same time, however, we recognize that it is helpful to provide investors with guidance as to our forecast of net sales, earnings per share and other financial metrics or projections. While we generally expect to provide updates to our financial guidance when we report our results each fiscal quarter, we do not have any responsibility to update any of our forward-looking statements at such times or otherwise. In addition, any longer-term guidance that we provide is based on goals that we believe, at the time guidance is given, are reasonably attainable for growth and performance over a number of years. However, such long-range targets are more difficult to predict than our current quarter and fiscal year expectations. If, or when, we announce actual results that differ from those that have been predicted by us, outside investment analysts, or others, our stock

We periodically return value to investors through payment of quarterly dividends. Investors may have an expectation that we will continue to pay our quarterly dividend at certain levels. The market price of our securities could be adversely affected if our cash dividend rate differs from investors’ expectations. See “If we are unable to pay quarterly dividends at intended levels, our reputation and stock price may be harmed” for addition discussion of our quarterly dividend.

We believe our trademarks, copyrights, patents, and other intellectual property rights are extremely important to our success and our competitive position. We devote significant resources to the registration and protection of our trademarks and to anti-counterfeiting efforts worldwide. In spite of our efforts, counterfeiting still occurs and if we are unsuccessful in challenging a third-party’s rights related to trademark, copyright, or patent this could adversely affect our future sales, financial condition, and results of operations. We are aggressive in pursuing entities involved in the trafficking and sale of counterfeit merchandise through legal action or other appropriate measures. We cannot guarantee that the actions we have taken to curb counterfeiting and protect our intellectual property will be adequate to protect the brand and prevent counterfeiting in the future. Our trademark applications may fail to result in registered trademarks or provide the scope of coverage sought. Furthermore, our efforts to enforce our intellectual property rights are often met with defenses and counterclaims attacking the validity and enforceability of our intellectual property rights. Unplanned increases in legal fees and other costs associated with defending our intellectual property rights could result in higher operating expenses. Finally, many countries’ laws do not protect intellectual property rights to the same degree as U.S. laws.

As a ~~company~~Company engaged in sourcing on a global scale, we are subject to the risks inherent in such activities, including, but not limited to:

We are subject to labor laws governing relationships with employees, including minimum wage requirements, overtime, working conditions, and citizenship requirements. Compliance with these laws may lead to increased costs and operational complexity and may increase our exposure to governmental investigations or litigation.

In addition, we require our independent manufacturers and suppliers to operate in compliance with applicable laws and regulations, as well as our Global Operating Principles and/or Supplier Selection ~~Guidelines,~~Guidelines; however, we do not control these manufacturers or suppliers or their labor, environmental or other business practices. Copies of our Global Business Integrity Program, Global Operating Principles and Supplier Selection Guidelines are ~~posted on~~available through our website, ~~coach.com.~~www.coach.com. The

We are dependent on a limited number of distribution and sourcing centers. Our ability to meet the needs of our customers and our retail stores and e-commerce sites depends on the proper operation of these centers. If any of these centers were to shut down or otherwise become inoperable or inaccessible for any reason, we could suffer a substantial loss of inventory and/or disruptions of deliveries to our retail and wholesale customers. While we have business continuity and contingency plans for our sourcing and distribution center sites, significant disruption of manufacturing or distribution for any of the above reasons could interrupt product supply, result in a substantial loss of inventory, increase our costs, disrupt deliveries to our customers and our retail stores, and, if not remedied in a timely manner, could have ana material adverse impact on our business. Because our distribution centers include automated and computer controlled equipment, they are susceptible to risks including power interruptions, hardware and system failures, software viruses, and security breaches. We maintain ~~three primary distribution centers:~~ a distribution center in Jacksonville, Florida, ~~owned and~~ operated by ~~Coach, an Asia~~Coach. To support our growth in mainland China and Europe, we established distribution ~~center~~centers in Shanghai, China and Oldenzaal, The Netherlands, owned and operated by a third-party, allowing us to better manage the logistics in these regions while reducing costs. We also operate distribution centers, through third-parties, in Japan, mainland China, Hong Kong, Singapore, Taiwan, Malaysia, The United States and ~~a distribution center, through a third-party, in Japan. See Distribution section of Item 1. Business for further discussion.~~South Korea. The warehousing of

We do not own any of our retail store locations. We lease our corporate-owned stores under long-term, non-cancelable leases, which usually have initial terms ranging from five and ten years, with renewal options typically in five year increments. We believe that the leases we enter into in the future will likely be long-term and non-cancelable and have similar renewal options. Generally, our leases are “net” leases, which require us to pay our proportionate share of the cost of insurance, taxes, maintenance and utilities. We generally cannot cancel these leases at our option. If we determine that it is no longer economical to operate a retail store subject to a lease and decide to close it as we have done in the past and will do in the future, we may remain obligated under the applicable lease for, among other things, payment of the base rent for the balance of the lease term. In some instances, we may be unable to close an underperforming retail store due to continuous operation clauses in our ~~costs, such~~lease agreements. In addition, as ~~raw materials, labor or freight could negatively impact our overall profitability. Labor costs at many~~each of our ~~manufacturers have been increasing significantly and, as the middle class~~leases expire, we may be unable to negotiate renewals, either on commercially acceptable terms or at all, which could cause us to close retail stores in ~~developing countries continues~~desirable locations. Our inability to grow, it is unlikely that such cost pressure will abate. The cost of transportation has been increasing as well and it is unlikely such cost pressure will abate if oil prices continue to increase. We may not be able to offset such increases in raw materialssecure desirable retail space or ~~labor or transportation costs through pricing measures or other means. These increasing costs of productions~~favorable lease terms could ~~also adversely affect~~impact our ability to ~~achieve~~grow. Likewise, our obligation to continue making lease payments in respect of leases for closed retail spaces could have a material adverse effect on our business, financial condition and results of operations.

The ability to successfully execute against our goals is heavily dependent on attracting, developing and retaining qualified employees, including our senior management team. Competition in our industry to attract and retain these employees is intense and is influenced by: our ability to offer competitive compensation and benefits, employee morale, our reputation, recruitment by other employers, perceived internal opportunities, non-competition and non-solicitation agreements and macro unemployment rates. Our transformation plan and its attendant changes regarding organizational efficiencies may intensify this risk.

We depend on the ~~gross margin objectives~~guidance of our senior management team and other key employees who have significant experience and expertise in our industry and our operations. In recent years, we have ~~established.~~

Our ~~Indirect segment,~~North American wholesale business, primarily consisting of the U.S. Wholesale ~~and Coach International businesses~~business, comprised approximately ~~11%~~5% of total net sales for fiscal ~~2012.~~2015. Continued ~~consolidation~~fragmentation in the retail industry could further decrease the number of, or concentrate the ownership of, stores that carry our and our licensees’ products. Furthermore, a decision by the controlling owner of a group of stores or any other significant customer, whether motivated by competitive conditions, financial difficulties or otherwise, to decrease or eliminate the amount of merchandise purchased from us or our licensing partners could result in an adverse effect on the sales and profitability within this channel.

We currently have multi-year agreements with licensing partners for our footwear, eyewear, watches and fragrance products. See Item 1 - “Business - Products” for additional discussion of our licensing arrangements. In the future, we may enter into additional licensing arrangements. The risks associated with our own products also apply to our licensed products as well as unique problems that our licensing partners may experience, including risks associated with each licensing partner’s ability to obtain capital, manage its labor relations, maintain relationships with its suppliers, manage its credit and bankruptcy risks, and maintain customer relationships. While we maintain significant control over the products produced for us by our licensing partners, any of the foregoing risks, or the inability of any of our licensing partners to execute on the expected design and quality of the licensed products or otherwise exercise operational and financial control over its business, may result in loss of revenue and competitive harm to our operations in the product categories where we have entered into such licensing arrangements. Further, while we believe that we could replace our existing licensing partners if required, our inability to do so for any period of time could materially adversely affect our revenues and harm our business.

As part of our long-term strategy, we look for opportunities to cost effectively enhance capability of business services. While we believe we conduct appropriate due diligence before entering into agreements with these third parties, the failure of any of these third parties to provide the expected services, provide them on a timely basis or to provide them at the prices we expect could disrupt or harm our business. Any significant interruption in the operations of these service providers, over which we have no control, could also have an adverse effect on our business. Furthermore, we may be unable to provide these services or implement substitute arrangements on a timely and cost-effective basis on terms favorable to us.

Because Coach products are frequently given as gifts, Coach has historically realized, and expects to continue to realize, higher sales and operating income in the second quarter of its fiscal year, which includes the holiday months of November and December. Poor sales in Coach’s second fiscal quarter would have a material adverse effect on its full year operating results and result in higher inventories. In addition, fluctuations in sales and operating income in any fiscal quarter are affected by the timing of seasonal wholesale shipments and other events affecting retail sales.

The dividend program requires the use of a ~~modest~~moderate portion of our cash flow. Our ability to pay dividends will depend on our ability to generate sufficient cash flows from operations in the future. This ability may be subject to certain economic, financial, competitive and other factors that are beyond our control. Our Board of Directors (“Board”) may, at its discretion, decrease the intended level of dividends or entirely discontinue the payment of dividends at any time. Any failure to pay dividends after we have announced our intention to do so may negatively impact our reputation, investor confidence in us and negatively impact our stock price.

We have maintained and accessed revolving credit facilities and issued debt securities as a source of liquidity, along with cash flows generated from our operations, our available cash and cash equivalents and short-term investments, our non-current investments, and other available financing options. We remain committed to maintaining a strong financial profile with ample liquidity. Our ability to access the credit and capital markets in the future as a source of funding, and the borrowing costs associated with such financing, is dependent upon market conditions and our credit rating and outlook.

We are subject to income taxes in many ~~U.S. and certain foreign~~ jurisdictions. We record tax expense based on our estimates of ~~future payments, which includes~~taxable income and required reserves for uncertain tax positions in multiple tax jurisdictions. At any one time, ~~many~~multiple tax years are subject to audit by various taxing jurisdictions. The results

The Company has entered into various agreements relating to the development of the Company’s new global corporate headquarters in a new office building to be located at the Hudson Yards development site in New York City. The financing, development and construction of the new building is taking place through a joint venture between the Company and the developers. Construction of the new building has commenced and occupancy in the new global headquarters is currently expected to take place in fiscal 2016. During fiscal 2015, the Company invested $139.1 million in the Hudson Yards joint venture, resulting in a total equity method investment of 320.2 million as of June 27, 2015. The Company expects to invest approximately $210 million in the joint venture over the next two years, with approximately $195 million estimated in fiscal 2016, depending on construction progress. Outside of the joint venture, the Company is directly investing in aspects of the new corporate headquarters. The Company has incurred $34.0 million of capital expenditures to date, including $5.9 million in fiscal 2015, and we expect approximately $185 million of additional expenditures over the remaining period of construction. The Company’s allocable share of the joint venture investments and capital expenditures will be financed by the Company with cash on hand, debt-related borrowings and approximately $130 million of proceeds from the sale of its current headquarters buildings.

Due to the inherent difficulty in estimating costs associated with projects of this scale and nature, certain of the costs associated with this project may be higher than estimated and it may take longer than expected to complete the project. In addition, the process of moving our headquarters is inherently complex and not part of our day to day operations. Thus, that process could cause significant disruption to our operations and cause the temporary diversion of management resources, all of which could have a material adverse effect on our business. In addition, we cannot give any assurance that our developer will complete its obligations in a timely manner or at all or how changes in the overall development of the Hudson Yards project may impact the development of, or value of, the building in which our new global headquarters will be located. Further, our developer has financing, construction and development obligations to parties other than us, and we cannot give any assurance as to how those obligations may impact the development of the project.

The ownership of real property, such as the new global corporate headquarters, also subjects us to various other risks, including, among others:

The Company's charter, bylaws and Maryland law contain provisions that could make it more difficult for a third party to acquire ~~Coach~~the Company without the consent of ~~Coach’s~~our Board. ~~Coach’s~~The Company's charter permits its Board, without stockholder approval, to amend the charter to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that ~~Coach~~the Company has the authority to issue. In addition, ~~Coach’s~~the Company's Board may classify or reclassify any unissued shares of common stock or preferred stock and may set the preferences, rights and other terms of the classified or reclassified shares. Although ~~Coach’s~~the Company's Board has no intention to do so at the present time, it could establish a series of preferred stock that could have the effect of delaying, deferring or preventing a transaction or a change in control that might involve a premium price for ~~Coach’s~~the Company's common stock or otherwise be in the best interest of ~~Coach’s~~the Company's stockholders.

~~Coach’s~~

The Company's bylaws can only be amended by ~~Coach’s~~our Board. ~~Coach’s~~The Company's bylaws also provide that nominations of persons for election to ~~Coach’s~~the Company's Board and the proposal of business to be considered at a stockholders meeting may be made only in the notice of the meeting, by ~~Coach’s~~the Company's Board or by a stockholder who is entitled to vote at the meeting and has complied with the advance notice procedures of ~~Coach’s~~the Company's bylaws. Also, under Maryland law, business combinations, including issuances of equity securities, between ~~Coach~~the Company and any person who beneficially owns 10% or more of ~~Coach’s~~the Company's common stock or an affiliate of such person are prohibited for a five-year period, beginning on the date such person last becomes a 10% stockholder, unless exempted in accordance with the statute. After this period, a combination of this type must be approved by two super-majority stockholder votes, unless some conditions are met or the business combination is exempted by ~~Coach’s~~the Company's Board.

We cannot assure you that an active trading market for the HDRs on the Hong Kong Stock Exchange ~~can~~will develop or be sustained. If an active trading market of the HDRs on the Hong Kong Stock Exchange does not develop or is not sustained, the market price and liquidity of the HDRs could be materially and adversely affected. As a result, the market price for HDRs in Hong Kong might not be indicative of the trading prices of Coach’s ~~Common Stock~~common stock on the NYSE, even allowing for currency differences.

The NYSE and the Hong Kong Stock Exchange have different trading hours, trading characteristics (including trading volume and liquidity), trading and listing rules, and investor bases (including different levels of retail and institutional participation). As a result of these differences, the trading prices of ~~Common Stock~~common stock and the HDRs representing them might not be the same, even allowing for currency differences. Fluctuations in the price of our ~~Common Stock~~common stock due to circumstances ~~peculiar~~particular to the U.S. capital markets could materially and adversely affect the price of the HDRs. Because of the different characteristics of the U.S. and Hong Kong equity markets, the historic market prices of our ~~Common Stock~~common stock may not be indicative of the performance of the HDRs.

We are a corporation incorporated in the State of Maryland in the United States and our HDRs are listed on the Hong Kong Stock Exchange. Our corporate governance practices are primarily governed by and subject to U.S. federal and Maryland laws and regulations. U.S. federal and Maryland laws and regulations differ in a

We have obtained a ruling from the Securities and Futures Commission of Hong Kong (the “SFC”) that we will not be regarded as a public ~~company~~Company in Hong Kong for the purposes of the Code on Takeovers and Mergers and the Share Repurchases Code of Hong Kong and hence, these codes will not apply to us. We have also obtained a partial exemption from the SFC in respect of the disclosure of interest provisions set out in the Securities and Futures Ordinance of Hong Kong. In addition, we have been granted waivers or exemptions by the Hong Kong Stock Exchange from certain requirements under its listing rules. Neither our stockholders nor the HDR holders will have the benefit of those Hong Kong rules, regulations and the listing rules of the Hong Kong Stock Exchange for which we have applied, and been granted, waivers or exemptions by the Hong Kong Stock Exchange and SFC.

Additionally, if any of these waivers or exemptions were to be revoked in circumstances including our non-compliance with applicable undertakings for any reason, additional legal and compliance obligations might be costly and time consuming, and might result in issues of interjurisdictional compliance, which could adversely affect us and HDR holders.

As the SFC does not have extra-territorial jurisdiction on any of its powers of investigation and enforcement, it will also have to rely on the regulatory regimes of Maryland state authorities and the SEC to enforce any corporate governance breaches committed by us in the United States. Investors in the HDRs should be aware that it could be difficult to enforce any judgment obtained outside the United States against us or any of our associates.

Furthermore, prospective investors in the HDRs should be aware, among other things, that there are U.S. federal withholding and estate tax implications for HDR holders.

HDR holders do not have the rights of stockholders. They only have the contractual rights set forth for their benefit under the deposit agreement for the HDRs (the “Deposit Agreement”). Holders of HDRs are not permitted to vote at stockholders’ meetings, and they may only vote by providing instructions to the HDR Depositary. There is no guarantee that holders of HDRs will receive voting materials in time to instruct the HDR Depositary to vote and it is possible that holders of HDRs, or persons who hold their Hong Kong depositary shares through brokers, dealers or other third parties, will not have the opportunity to exercise a right to vote, although both we and the HDR Depositary will endeavor to make arrangements to ensure as far as practicable that all holders of HDRs will be able to vote. As the HDR Depositary or its nominee will be the registered owner of the ~~Common Stock~~common stock underlying their HDRs, holders of HDRs must rely on the HDR Depositary (or its nominee) to exercise rights on their behalf. In addition, holders of HDRs will also incur charges on any cash distribution made pursuant to the Deposit Agreement and on transfers of certificated HDRs.

If we decide to undertake an equity offering (that is not a rights or other offering that is extended to HDR holders), HDR holders may suffer a dilution in their indirect ownership and voting interest in the ~~Common Stock,~~common stock, as compared to their holdings in the HDRs immediately prior to such an offering.

An investment in HDRs will depend for its continuing viability on the performance of several service providers, including but not limited to the HDR Depositary, the registrar for the HDRs, the custodian and any sub-custodian appointed in respect of the underlying ~~Common Stock.~~common stock. A failure by any of those service

Our ~~Common Stock~~common stock is presently traded on the NYSE. Any HDR holder may at any time request that their HDRs be withdrawn and exchanged into ~~Common Stock~~common stock for trading on the NYSE. Upon the exchange of HDRs into ~~Common Stock,~~common stock, the relevant HDRs will be cancelled. In the event that a substantial number of HDRs are withdrawn and exchanged into Common Stock and subsequently cancelled, the liquidity of the HDRs on the Hong Kong Stock Exchange might be adversely affected.

There is no direct trading or settlement between the NYSE and the Hong Kong Stock Exchange on which the ~~Common Stock~~common stock and the HDRs are respectively traded. In addition, the time differences between Hong Kong and New York and unforeseen market circumstances or other factors may delay the exchange of HDRs into ~~Common Stock~~common stock (and vice versa). Investors will be prevented from settling or effecting the sale of their securities across the various stock exchanges during such periods of delay. In addition, there is no assurance that any exchange of HDRs into ~~Common Stock~~common stock (and vice versa) will be completed in accordance with the timelines investors might anticipate.

The value of an investment in the HDRs quoted in Hong Kong dollars and the value of dividend payments in respect of the HDRs could be affected by fluctuations in the U.S. dollar/Hong Kong dollar exchange rate. While the Hong Kong dollar is currently linked to the U.S. dollar using a specified trading band, no assurance can be given that the Hong Kong government will maintain the trading band at its current limits or at all.

None.

The following table sets forth the location, use and size of ~~Coach's~~the Company's key distribution, corporate and product development facilities as of June ~~30, 2012.~~27, 2015. The majority of the properties are leased, with the leases expiring at various times through 2028, subject to renewal options.

As of June ~~30, 2012, Coach~~27, 2015, the Company also occupied ~~354~~258 Coach retail and ~~169 factory~~204 Coach outlet leased stores located in North America, ~~180~~503 Coach-operated concession shop-in-shops within department ~~store shop-in-shops,~~stores, Coach retail ~~stores~~ and ~~factory~~outlet stores in ~~Japan, 96 Coach-operated department store shop-in-shops, retail~~our international locations, and 54 Stuart Weitzman stores ~~and factory stores in Hong Kong, Macau and mainland China, and 34 Coach-operated department store shop-in-shops, retail stores and factory stores in Taiwan and Singapore.~~globally. These leases expire at various times through ~~2024.~~2036. Coach considers these properties to be in generally good condition and believes that its facilities are adequate for its operations and provide sufficient capacity to meet its anticipated requirements.

Refer to Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" and Note 3, "Transformation and Other Actions," for further information regarding the Transformation Plan, and its impact on future store trends.

Coach is involved in various routine legal proceedings as both plaintiff and defendant incident to the ordinary course of its business, including proceedings to protect Coach’s intellectual property rights, litigation instituted by persons alleged to have been injured upon premises within Coach’s control and litigation with present or former employees.

As part of Coach’s policing program for its intellectual property rights, from time to time, Coach files lawsuits in the U.S. and abroad alleging acts of trademark counterfeiting, trademark infringement, patent infringement, trade dress infringement, copyright infringement, unfair competition, trademark dilution and/or state or foreign law claims. At any given point in time, Coach may have a number of such actions pending. These actions often result in seizure of counterfeit merchandise and/or out of court settlements with defendants. From time to time, defendants will raise, either as affirmative defenses or as counterclaims, the invalidity or unenforceability of certain of Coach’s intellectual properties.

Although Coach’s litigation with present or former employees is routine and incidental to the conduct of Coach’s business, as well as for any business employing significant numbers of employees, such litigation can result in large monetary awards when a civil jury is allowed to determine compensatory and/or punitive

Coach believes that the outcome of all pending legal proceedings in the aggregate will not have a material ~~adverse~~ effect on Coach’s business or consolidated financial statements.

Coach has not entered into any transactions that have been identified by the IRS as abusive or that have a significant tax avoidance purpose. Accordingly, we have not been required to pay a penalty to the IRS for failing to make disclosures required with respect to certain transactions that have been identified by the IRS as abusive or that have a significant tax avoidance purpose.

Coach’s common stock is listed on the New York Stock Exchange and is traded under the symbol “COH.” Coach’s Hong Kong Depositary Receipts have ~~also~~ been listed on the Hong Kong Stock Exchange since December 2011 and the issuance from time-to-time of these Hong Kong Depositary Receipts has not been registered under the Securities Act, or with any securities regulatory authority of any state or other jurisdiction of the United States and is being made pursuant to Regulation S of the Securities Act. Accordingly, they may not be re-offered, resold, pledged or otherwise transferred in the United States or to, or for the account of, a “U.S. person” (within the meaning of Regulation S promulgated under the Securities Act), unless the securities are registered under the Securities Act or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, and hedging transactions involving the Hong Kong Depositary Receipts may not be conducted unless in compliance with the Securities Act. No additional common stock was issued, nor capital raised through this listing.

The following table sets forth, for the fiscal periods indicated, the high, low and ~~low~~closing prices per share of Coach’s common stock as reported on the New York Stock Exchange Composite Index.

As of ~~August 3, 2012,~~July 31, 2015, there were ~~3,400~~3,809 holders of record of Coach’s common stock.

Any future determination to pay cash dividends will be at the discretion of Coach’s Board and will be dependent upon Coach’s financial condition, operating results, capital requirements and such other factors as the Board deems relevant.

The following graph compares the cumulative total stockholder return (assuming reinvestment of dividends) of ~~Coach’s~~the Company's common stock with the cumulative total return of the S&P 500 Stock Index and the “former peer set” and ~~“revised~~"revised peer ~~set”~~set" companies listed below over the five-fiscal-year period ending June ~~29, 2012,~~27, 2015, the last trading day of Coach’s most recent fiscal year. ~~Coach’s “former peer set,” as determined by management, through fiscal 2011, consisted of:~~

~~Ann Taylor Stores Corporation,~~

~~Kenneth Cole Productions, Inc.,~~

~~Ralph Lauren Corporation,~~

~~Tiffany & Co.,~~

~~Talbots, Inc., and~~

~~Williams-Sonoma, Inc.~~

~~During fiscal 2012, the Company established a “revised peer set” consisting of:~~

~~The Gap, Inc.,~~

~~Guess?, Inc.,~~

~~Limited Brands, Inc.,~~

~~PVH Corporation,~~

~~Ralph Lauren Corporation,~~

~~Tiffany & Co.,~~

~~V.F. Corporation, and~~

~~Williams-Sonoma, Inc.~~

Coach management selected the “revised peer set” on an industry/line-of-business basis and believes these companies represent good faith comparables based on their history, size, and business models in relation to Coach, Inc.

Coach management selected the “revised peer set” on an industry/line-of-business basis and believes this updated set of companies represent good faith comparables based on their history, size, and business models in relation to Coach, Inc.

The ~~Company’s share repurchases~~Company did not repurchase any shares during the fourth quarter of fiscal 2015. The existing plan, publicly announced on October 23, 2012, ~~were~~expired in June 2015 with zero remaining availability as ~~follows:~~

Period Total Number
of Shares
Purchased Average Price
Paid per
Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs⁽¹⁾ Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs⁽¹⁾
(in thousands, except per share data)
Period 10 (4/1/12 – 5/5/12) 335 $ 73.52 335 $ 405,998
Period 11 (5/6/12 – 6/2/12) 1,478 69.07 1,478 303,905
Period 12 (6/3/12 – 6/30/12) 680 62.17 680 261,627
Total 2,493 2,493

~~(1)~~

~~The Company repurchases its common shares under repurchase programs that were approved by the Board as follows:~~


~~Date Share Repurchase Programs were~~ ~~Publicly Announced~~	~~Total Dollar Amount Approved~~		~~Expiration Date of Plan~~
~~January 25, 2011~~	$	~~1.5 billion~~		~~June 2013~~

of June 27, 2015.

The following discussion of Coach’s financial condition and results of operations should be read together with Coach’s consolidated financial statements and notes to those statements, included elsewhere in this document. When used herein, the terms ~~“Coach,~~“Company,” ~~“Company,”~~"Coach," “we,” “us” and “our” refer to Coach, Inc., including consolidated subsidiaries.

Coach, Inc. is a leading ~~American marketer~~New York design house of ~~fine~~modern luxury accessories and ~~gifts for women~~lifestyle brands. The Coach brand was established in New York City in 1941, and ~~men. Our product offerings include women’s~~has a rich heritage of pairing exceptional leathers and ~~men’s bags, accessories, business cases, footwear, wearables, jewelry, sunwear, travel bags, watches and fragrance.~~ materials with innovative design.

Coach, Inc. operates in ~~two~~three segments: ~~Direct-to-Consumer~~North America, International and ~~Indirect.~~Other (which includes the Stuart Weitzman brand acquired by the Company in the fourth quarter of fiscal 2015). The ~~Direct-to-Consumer~~North America segment includes sales to ~~consumers~~North American customers through Coach-operated stores (including the Internet) and sales to North American wholesale customers. The International segment includes sales to customers through Coach-operated stores (including the Internet) and concession shop-in-shops in ~~North America; Japan;~~Japan and mainland China, Coach-operated stores and concession shop-in-shops in Hong Kong, Macau, ~~and mainland China; Taiwan;~~ Singapore, Taiwan, Malaysia, South Korea, the United Kingdom, France, Ireland, Spain, Portugal, Germany, Italy, Belgium and the ~~Internet. Beginning with the first quarter of fiscal 2013, this segment also includes Coach-operated stores in Malaysia and Korea. The Indirect segment includes~~Netherlands, as well as sales to wholesale customers and distributors in ~~over 20 countries,~~approximately 45 countries. Other, consists of sales and expenses generated by the Coach brand in other ancillary channels, including licensing and disposition. Other also consists of sales and expenses generated by the ~~United States, and royalties earned on licensed product.~~Stuart Weitzman brand during the final two months of fiscal 2015. As ~~Coach’s~~the Company's business model is based on multi-channel ~~international~~global distribution, our success does not depend solely on the performance of a single channel or geographic area.

In order to ~~sustain~~drive growth within our global ~~framework, we continue to focus on two key growth strategies: increased global distribution, with an emphasis on North America and China, and improved store sales productivity. To that end~~business, we are focused on four key ~~initiatives:~~

initiatives, which directly align with the Coach brand Transformation Plan, described below:

During the fourth quarter of fiscal 2014, Coach, Inc. announced a multi-year strategic plan with the objective of transforming the Coach brand and reinvigorating growth, which we believe will enable the Company to return to ‘best-in-class’ profitability. This multi-faceted, multi-year transformation plan (the "Transformation Plan") builds on the core brand equities of quality and craftsmanship with the aim of evolving our ~~most loyal Factory exclusive customers. The Company utilizes and continues to explore implementing~~

Key operational and cost measures of the Transformation Plan include: (i) the investment in capital improvements in our ~~investments~~stores and wholesale locations to drive ~~increased cash flows from operating activities. However,~~comparable sales improvement; (ii) the ~~current macroeconomic environment, while stabilizing, has created a challenging retail market in which consumers, notably~~optimization and streamlining of our organizational model as well as the closure of underperforming stores in North America, and ~~Japan, are still cautious.~~select International stores; (iii) the realignment of inventory levels and mix to reflect our elevated product strategy and consumer preferences; (iv) the investment of approximately $50 million in incremental advertising costs to elevate consumer perception of our Coach brand, drives sales growth and promote our new strategy, which started in fiscal 2015; and (v) the significant scale-back of our promotional cadence in an increased global promotional environment, particularly within our outlet Internet sales site, which began in fiscal 2014. The ~~Company believes long-term growth can still be achieved~~Company's execution of these key operational and cost measures were on plan through a combination of expanded distribution, a focus on innovation to support productivity and disciplined expense control. Our multi-channel distribution model is diversified and includes substantial international and factory businesses, which reduces our reliance upon our full-price U.S. business. With an essentially debt-free balance sheet and significant cash position, we have a business model that generates significant cash flow and we are in a position to invest in our brand while continuing to return capital to shareholders through common stock repurchases and dividends.

~~The key metrics of fiscal 2012 were:~~

~~Earnings per diluted share rose 20.9% to $3.53.~~

~~Net sales increased 14.5% to $4.76 billion.~~

~~Direct-to-consumer sales rose 16.1% to $4.23 billion.~~

~~Comparable sales in Coach’s North American stores increased 6.6%.~~

~~In North America, Coach opened 9 net new retail stores and 26 new factory stores, including 16 Men’s, bringing the total number of retail and factory stores to 354 and 169, respectively, at~~ the end of fiscal ~~2012.~~ 2015, and we believe that long-term

29

growth can be realized through these transformational efforts over time. For further discussion of charges incurred in connection with the Transformation Plan, see "Items Affecting Comparability," herein.

Furthermore, as discussed in Note 7, "Acquisitions," the Company acquired luxury designer footwear brand Stuart Weitzman, which we believe will complement our current leadership position in premium handbags and accessories, while immediately adding to the Company's earnings as we continue to make meaningful progress towards our brand transformation. The acquisition was consummated on May 4, 2015, and the brand contributed $43.0 million in net sales in fiscal 2015, included within our Other segment.

Current Trends and Outlook

In addition to the risks surrounding the successful execution of our Transformation Plan initiatives, our outlook reflects a certain level of uncertainty surrounding the global economy. The global economic environment continues to have an impact on consumer confidence, which in turn influences the level of spending on discretionary items. Global consumer retail traffic remained relatively weak and inconsistent, which has led to a more promotional environment in the fragmented retail industry due to increased competition and a desire to offset traffic declines with increased levels of conversion. Macroeconomic and geopolitical events in Greater China and southeast Asia have contributed to volatility in consumer spending within the region. Furthermore, it is still too early to understand the impact, if any, of MERS (Middle East Respiratory Syndrome) on consumer spending in Asia, including the impact on tourism in the region.

Within the U.S., a prolonged and tough winter season impacted demand during the first half of calendar 2015, however certain limited and recent factors within the U.S., including an improvement in the labor market and modest growth in overall consumer spending, suggest a potential moderate strengthening in the U.S. economic outlook. It is still, however, too early to understand what kind of sustained impact this will have on consumer discretionary spending. If the global macroeconomic environment remains volatile or worsens, the constrained level of worldwide consumer spending and modified consumption behavior may continue to have a negative effect on our outlook.

We ~~also expanded 10 factory~~will continue to monitor these risks and trends and evaluate and adjust our operating strategies and cost management opportunities to mitigate the related impact on our results of operations, while remaining focused on the long-term growth of our business and protecting the value of our brands.

As discussed in Part I, Item 1 - "Business" and as part of our Transformation Plan as described in Note 3, "Transformation and Other Actions," in fiscal 2015, we have reduced the number of retail stores and total square footage within North America, as we continue to optimize our real estate position. We expect this trend to continue in the next fiscal year with the anticipated closure of approximately 15-20 North America retail stores in ~~North America.~~

~~Coach China results continued~~fiscal 2016, attributable to ~~be strong with double-digit~~our Transformation Plan. We expect to continue to see modest to no growth in ~~comparable~~North America outlet store square footage as we continue to optimize our real estate position across channels by expanding our most productive stores to accommodate a broader expression of lifestyle assortment while continuing to assess opportunities to close under-performing stores. Within our International segment, we are expecting to reflect modest growth in our store count over the next few years, particularly within mainland China and Europe. Lastly, within Stuart Weitzman, we are expecting modest growth in our real estate position over the next year.

For a detailed discussion of significant risk factors that have the potential to cause our actual results to differ materially from our expectations, see Part I, Item 1A - "Risk Factors" included in this Annual Report on Form 10-K.

30

SUMMARY — FISCAL 2015

In fiscal 2015, Coach, ~~China opened 30~~Inc. reported net ~~new locations, bringing~~sales of $4.19 billion (including $43.0 million attributable to the ~~total number~~Stuart Weitzman brand), net income of ~~locations at~~$402.4 million and net income per diluted share of $1.45. This compares to net sales of $4.81 billion, net income of $781.3 million, and net income per diluted share of $2.79 in fiscal 2014.

In fiscal 2015, the ~~end~~comparability of our operating results has been affected by $145.9 million of pretax charges ($107.8 million after tax, or $0.39 per diluted share) related to our Transformation Plan, $24.6 million of pretax charges ($21.0 million after tax, or $0.08 per diluted share) related to acquisition charges associated with the Stuart Weitzman brand. These fiscal ~~2012 to 96.~~

~~Coach Japan opened 11 net new locations, bringing the total number of locations at the end of fiscal 2012 to 180. In addition, we expanded three locations.~~

The company acquired its domestic retail Coach businesses in Taiwan and Singapore. As the result of these acquisitions and subsequent openings, the company operated 7 retail locations in Singapore and 27 in Taiwan as of the end of fiscal 2012. The Company has assumed direct control of its domestic business in Malaysia in July 2012 and its domestic retail business in Korea in August 2012.

~~Coach’s Board~~2015 actions taken together increased the ~~Company’s cash dividend~~Company's selling, general and administrative ("SG&A") expenses by ~~33%~~$160.8 million and cost of sales by $9.7 million, negatively impacting net income by $128.8 million, or $0.47 per diluted share.

In fiscal 2014, the comparability of our operating results was affected by $131.5 million of pretax charges ($88.3 million after tax or $0.31 per diluted share) related to our Transformation Plan. These fiscal 2014 actions increased the Company's SG&A expenses by $49.3 million and cost of sales by $82.2 million, negatively impacting net income by $88.3 million, or $0.31 per diluted share.

Our operating performance for fiscal 2015 reflected a decline in net sales of 12.8%, primarily due to our North America business partially offset by a $43.0 million contribution from the Stuart Weitzman brand. Excluding the effects of foreign currency, net sales decreased 10.6%. Our gross profit decreased by 11.8% to $2.91 billion during fiscal 2015 which included the negative impact of charges under our Transformation Plan of $5.0 million and Stuart Weitzman purchase accounting related items of $4.7 million. Excluding our Transformation Plan and acquisition-related charges in fiscal 2015 and fiscal 2014, gross profit decreased by 13.6%, to ~~an expected annual rate~~$2.92 billion. SG&A expenses increased by 5.2% to $2.29 billion during fiscal 2015. Excluding charges under our Transformation Plan and acquisition-related charges in fiscal 2015 and fiscal 2014, SG&A expenses remained fairly consistent.

Net income decreased in fiscal 2015 as compared to fiscal 2014, due to a decrease in operating income of ~~$1.20~~$502.1 million, partially offset by a $131.8 million decrease in our provision for income taxes. Net income per diluted share ~~starting with the dividend paid on July 2, 2012.~~decreased primarily due to lower net income. Excluding charges under our Transformation Plan and acquisition-related charges in fiscal 2015 and charges under our Transformation Plan in fiscal 2014, net income and net income per diluted share decreased 38.9% and 38.2%, respectively.

The Company’s reported results are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The reported gross profit, SG&A expenses, operating income, income before provision for income taxes, provision for income taxes, net income and earnings per diluted share in fiscal 2015 and 2014 reflect certain items which

In fiscal 2015, the Company incurred charges as follows:

These fiscal 2015 actions taken together increased the Company's SG&A expenses by $160.8 million and cost of sales by $9.7 million, negatively impacting net income by $128.8 million, or $0.47 per diluted share. Refer to the "Executive Overview" herein and Note 3, "Transformation and Other Actions," for further information regarding the Transformation Plan.

Additional actions under our Transformation Plan will continue into fiscal 2016, with expected incremental charges of around $50 million.

In fiscal 2014, the Company incurred restructuring and transformation related charges of $131.5 million under its Transformation Plan as announced in the fourth quarter of fiscal 2014. The charges recorded in cost of sales and SG&A expenses were $82.2 million and $49.3 million, respectively. These charges, which were primarily associated with our North America business, relate to inventory and fleet related costs, including impairment, accelerated depreciation and severance related to store closures.

The change in net sales in fiscal 2015 has been presented both including and excluding currency fluctuation effects (primarily attributable to Coach Japan).

Net sales decreased 12.8% or $614.6 million to $4.19 billion in fiscal 2015. Excluding the effects of foreign currency, net sales decreased 10.6% or $511.3 million. This decrease was driven by lower sales in the North America business partially offset by gains in the International business, and a $43.0 million contribution due to the acquisition of Stuart Weitzman. The following table presents net sales by ~~operating~~reportable segment for fiscal ~~2012~~2015 compared to fiscal ~~2011:~~

2014:

Comparable store sales measure sales performance at stores that have been open for at least 12 months, and includes sales from ~~coach.com.~~the Internet. Coach excludes new locations from the comparable store base for the first ~~year~~twelve months of operation. ~~Similarly,~~Comparable store sales have not been adjusted for store expansions.

North America Net Sales decreased 20.4% or $633.0 million to $2.47 billion in fiscal 2015. Excluding the unfavorable impact of foreign currency due to the Canadian dollar, net sales decreased $622.5 million or 20.1%. This decrease was primarily driven by lower comparable store sales of $613.4 million or 22%, due to lower traffic as a result of a decrease in promotional activity, partially offset by higher transaction size. The Internet business had a negative impact of approximately 740 basis points on comparable store sales which is attributable to the Company's decision to both limit access and reduce the promotional cadence on our outlet Internet sales site. North America sales were also negatively impacted by lower wholesale sales of approximately $53.9 million due to lower shipments. These decreases were partially offset by a net increase of $32.4 million related to net sales generated by new store openings which were partially offset by the absence of net sales for those stores that ~~are expanded by 15%~~have closed since fiscal 2014. Since the end of fiscal 2014, Coach closed a net 74 retail stores and a net three outlet stores, including the closure of 11 Men’s outlet stores.

International Net Sales decreased 1.3% or ~~more are also excluded from~~$22.2 million to $1.62 billion in fiscal 2015. Excluding the ~~comparable store base until~~unfavorable impact of foreign currency, primarily due to the ~~first anniversary of their reopening. Stores that are closed for renovations are removed from the comparable store base.~~

~~In North America,~~Japanese yen, net sales increased ~~12.7% driven by sales from~~$70.8 million or 4.3%. This increase was primarily due to growth in Greater China (which includes Hong Kong and Macau) reflecting an increase of $50.5 million primarily due to net new ~~and expanded~~ stores and positive comparable store sales, an increase of $36.7 million related to net new store openings and positive comparable store sales of our business in Europe and an increase of $15.7 million in our international wholesale business partially due to higher shipments. These increases were partially offset by a ~~6.6% increase~~decrease in ~~comparable store sales. During~~net sales in Japan of $37.4 million due to lower traffic as a result of lapping the pull forward in demand in advance of the April 2014 consumption tax increase. Since the end of fiscal ~~2012, Coach~~2014, we opened 928 net new ~~retail~~ stores, and 26 new factory stores, and expanded 10 factory stores in North America. In Japan, net sales increased 11.7% driven by an approximately $40.1 million, or 5.3%, positive impact from foreign currency exchange. During fiscal 2012, Coach opened 11 net new locations and expanded three locations in Japan. Coach China results continued to be strong with ~~double-digit percentage growth in comparable store sales. During fiscal 2012, Coach opened 30~~16 net new stores in mainland China, Hong Kong and ~~mainland China.~~

~~Indirect~~ —Macau and Japan, and 12 net new stores in the other regions.

Other Net ~~sales~~Sales increased ~~3.8%~~66.0% or $40.6 million to ~~$531.5~~$102.1 million, ~~from $512.1~~primarily due to the impact of the Stuart Weitzman acquisition.

Gross profit decreased 11.8% or $388.4 million in fiscal 2011. The increase was driven primarily by a 7.9% increase in Coach International Wholesale net revenue, partially offset by a 1.6% decrease in U.S. Wholesale net revenue. Licensing revenue of approximately $28.5 million and $24.7 million in fiscal 2012 and fiscal 2011, respectively, is included in Indirect sales.

North America Gross Profitdecreased 21.0% or $418.1 million to ~~32.0% in fiscal 2011.~~

~~Gross profit increased 14.6% to $3.47~~$1.57 billion in fiscal ~~2012~~2015. Gross margin decreased 50 basis points from ~~$3.02~~64.3% in fiscal 2014 to 63.8% in fiscal 2015. The decrease in gross margin is primarily attributable to the impact of decreased promotional activity on an elevated product assortment. Specifically, the impact of a higher mix of elevated product sales primarily in our outlet stores, which contained higher average unit costs, negatively impacted gross margin by 120 basis points. This decrease was mostly offset by lower promotional activity, mainly as a result of the scale-back of promotional events within our outlet channel which favorably impacted gross margin by 90 basis points.

International Gross Profit decreased 3.6% or $46.5 million to $1.25 billion in fiscal ~~2011.~~2015. Gross margin ~~was 72.8%~~decreased 180 basis points from 78.8% in fiscal ~~2012~~2014 to 77.0% in fiscal 2015. The decrease in gross margin is primarily due to a less favorable geographic mix of our sales and unfavorable effects of foreign currency, which in aggregate negatively impacted gross margin by 110 basis points, particularly as ~~compared~~a result of a decline in net sales in Japan, coupled with the growth of our international wholesale business, as well as the impact of stronger elevated product sales which carry higher average unit costs, negatively impacting gross margin by 60 basis points and to ~~72.7%~~a lesser extent increased promotional activity.

Other Gross Profit increased 57.2% or $21.1 million to $58.0 million in fiscal 2015. This increase is substantially attributable to the acquisition of the Stuart Weitzman brand during the fourth quarter of fiscal ~~2011. Coach’s~~2015.

Corporate Unallocated Gross Profit increased $55.1 million from a loss of $27.9 million in fiscal 2014 to a profit of $27.2 million in fiscal 2015. Excluding items affecting comparability of $9.7 million in fiscal 2015 and $82.2 million in fiscal 2014, corporate unallocated gross profit ~~is dependent upon a variety of factors, including changes~~decreased by $17.4 million from $54.3 million in ~~the relative sales mix among distribution channels, changes~~fiscal 2014 to $36.9 million in ~~the mix of products sold, foreign currency exchange rates~~fiscal 2015, primarily due to increased inventory reserves and ~~fluctuations in material costs. These factors, among others may cause gross profit to fluctuate from year to year.~~

less favorable production variances.

SG&A expenses are comprised of four categories: ~~(1)~~(i) selling; ~~(2)~~(ii) advertising, marketing and design; ~~(3)~~(iii) distribution and ~~consumer~~customer service; and ~~(4)~~(iv) administrative. Selling expenses include store employee compensation, ~~store~~ occupancy costs ~~store~~and supply costs, wholesale and retail account administration compensation globally and ~~all Coach Japan, Coach China, Coach Singapore and Coach Taiwan~~international operating expenses. These expenses are affected by the number of ~~Coach-operated~~Company-operated stores ~~in North America; Japan; Hong Kong, Macau, mainland China; Taiwan and Singapore~~ open during any fiscal ~~period.~~period and store performance, as compensation and rent expenses vary with sales. Advertising, marketing and design expenses include employee compensation, media space and production, advertising agency fees, new product design costs, public relations and market research expenses. Distribution and ~~consumer~~customer service expenses include warehousing, order fulfillment, shipping and handling, customer service, employee compensation and bag repair costs. Administrative expenses include compensation costs for ~~the~~“corporate” functions including: executive, finance, human resources, legal and information systems departments, as well as corporate headquarters occupancy costs, consulting fees and software expenses. ~~SG&A~~Administrative expenses ~~increase as the number~~also include global equity compensation expense.

The Company includes inbound product-related transportation costs from our service providers within cost of ~~Coach-operated stores increase, although an increase in the number of stores generally results in the fixed portion of SG&A expenses being spread over a larger sales base.~~

~~Coach,~~sales. The Company, similar to some companies, includes certain transportation-related costs related to our distribution network in selling, general and administrative expenses rather than in cost of sales; for this reason, our gross margins may not be comparable to that of entities that include all costs related to their distribution network in cost of sales.

~~During fiscal 2012,~~

SG&A expenses increased ~~13.7%~~5.2% or $113.7 million to ~~$1.95~~$2.29 billion in fiscal 2015 as compared to ~~$1.72~~$2.18 billion ~~during fiscal 2011. Excluding items affecting comparability of $39.2 million~~ in fiscal ~~2012 and $25.7 million in fiscal 2011, SG&A expenses were $1.91 billion and $1.69 billion, respectively.~~2014. As a percentage of net sales, SG&A expenses ~~were 41.0% and 41.3%~~increased to 54.6% during fiscal ~~2012 and~~2015 as compared to 45.3% during fiscal ~~2011, respectively.~~2014. Excluding items affecting comparability ~~during~~of $160.8 million in fiscal ~~2012~~2015 and $49.3 million in fiscal ~~2011,~~2014, SG&A expenses increased $2.2 million from fiscal 2014; and SG&A expenses as a percentage of net sales ~~were 40.2% and 40.7%, respectively,~~increased, due to deleveraging as ~~we leveraged our selling expense base on higher sales.~~

net sales have declined, to 50.8% in fiscal 2015 from 44.3% in fiscal 2014.

Selling expenses were ~~$1.36~~$1.53 billion, or ~~28.5%~~36.6% of net sales, in fiscal 2015 compared to ~~$1.18~~$1.55 billion, or ~~28.5%~~32.2% of net sales, ~~during~~in fiscal ~~2011.~~2014. The ~~dollar increase in~~$16.5 million decrease represents slightly lower selling expenses ~~was due~~related to ~~higher operating expenses~~our North America stores and Internet business, which were partially offset by increases to support growth in ~~Coach China~~our International business (primarily in Europe and ~~North American stores due to higher sales and new store openings. Coach Japan operating expenses decreased by $0.4~~Greater China) as well as incremental Stuart Weitzman selling expenses. Excluding items affecting comparability of $4.1 million in ~~constant currency, but was more than offset by the impact~~fiscal 2015, selling expenses were 36.5% of ~~foreign currency exchange rates which increased reported expenses by approximately $15.2 million.~~

net sales.

Advertising, marketing, and design costs were ~~$245.2~~$246.8 million, or ~~5.1%~~5.9% of net sales, in fiscal 2015, compared to ~~$224.4~~$242.3 million, or ~~5.4%~~5.0% of net sales, during fiscal ~~2011.~~2014. The ~~dollar~~ increase was primarily due to marketing expenses related to consumer communications, which includes our digital strategy through coach.com, our global e-commerce sites, third-party flash sites, marketing sites and social networking. The Company operates marketing websites in 23 countries, and utilizes social networking and blogs as cost-effective consumer communication opportunities to increase online and store sales and build brand awareness. Also contributing to the ~~increase were new design expenditures and development~~result of higher costs for ~~new merchandising initiatives.~~

marketing-related events which increased by $28.8 million as compared to fiscal 2014, partially offset by fewer promotional events made by the Company, primarily as a result of the Company's decision to limit access to our outlet Internet sales site.

Distribution and consumer service expenses were ~~$68.9~~$69.6 million, or ~~1.4%~~1.7% of net sales, in fiscal 2015, compared to ~~$58.2~~fiscal 2014 expenses of $87.2 million, or ~~1.4%~~1.8% of net sales. The decrease was primarily due to lower variable costs as a result of lower sales associated with the Company's decision to limit access to our outlet Internet sales site.

Administrative expenses were $441.5 million, or 10.5% of net sales, in fiscal 2015 compared to $300.5 million, or 6.3% of net sales, during fiscal ~~2011.~~

~~Administrative expenses were $282.2 million, or 5.9% of net sales, compared to $252.4 million, or 6.1% of net sales, during fiscal 2011.~~2014. Excluding items affecting comparability of ~~$39.2 in fiscal 2012 and~~

Operating income decreased 44.8% or $502.1 million to $618.0 million during fiscal 2015 as compared to $1.12 billion in fiscal 2014. Operating margin decreased to 14.7% as compared to 23.3% in fiscal 2014. Excluding items affecting comparability of $170.5 million in fiscal 2015 and $131.5 million in fiscal 2014, operating income decreased 37.0% or $463.1 million to $788.5 million from $1.25 billion in fiscal 2014; and operating margin was 18.8%, in fiscal 2015 as compared to 26.0% in fiscal 2014.

The following table presents operating income by reportable segment for fiscal 2015 compared to fiscal 2014:

North America Operating Incomedecreased 29.5% or $343.6 million to $820.5 million in fiscal 2015 reflecting the decrease in gross profit of $418.1 million which was partially offset by lower SG&A expenses of $74.5 million. The decrease in SG&A expenses was due to lower variable selling costs as a result of lower sales in our ~~international expansion.~~

International Operating Incomedecreased 13.5% or $75.1 million to $480.6 million in fiscal 2015, primarily reflecting a decrease in gross profit of $46.5 million as well as higher SG&A expenses of $28.6 million. The increase in SG&A expenses is related to a $30.8 million increase in Greater China and Asia, excluding Japan, related to new store openings and a $24.9 million increase in Europe to support growth in the business. The increase in SG&A costs were partially offset by foreign currency effects in Japan of $32.2 million. Operating margin decreased 420 basis points to 29.6% in fiscal 2015 from 33.8% during the same period in the prior year primarily due to higher overall SG&A as a percentage of net sales which increased by 240 basis points and lower gross margin of 180 basis points.

Corporate Unallocated Operating Expense increased $74.7 million to $708.6 million in fiscal 2015, an increase of 11.8%. This increase was primarily attributable to higher charges incurred by the Company in fiscal 2015 as part of its Transformation Plan. Excluding items affecting comparability, unallocated operating expenses increased by 8.9% or $44.6 million to $547.0 million from $502.4 million. This increase is primarily due to higher incentive compensation costs and additional costs incurred particularly related to information technology.

The effective tax rate was ~~31.0%~~34.2% in fiscal ~~2012~~2015, as compared to ~~32.3%~~30.4% in fiscal 2011. During the second quarter of fiscal 2012, the Company recorded the effect of a revaluation of certain deferred tax asset balances due to a change in Japan’s corporate tax laws and the favorable completion of a multi-year transfer pricing agreement with Japan. Also, during the fourth quarter of fiscal 2012, the Company recognized a favorable tax settlement. As a result, it made charitable contributions which precisely offset the benefit of the tax settlement to net income and earnings per share. During the third quarter of fiscal 2011, the Company decreased the provision for income taxes primarily as a result of a favorable settlement of a multi-year tax return examination.2014. Excluding the ~~benefit from these~~ items affecting comparability, the effective tax rate was ~~32.8%~~32.1% in fiscal ~~2012 and 33.6%~~2015, as compared to 30.6% in fiscal ~~2011.~~2014. The ~~decrease~~increase in ~~the~~our effective tax rate ~~is also~~was primarily attributable to ~~higher profitability~~the loss of certain foreign tax benefits that expired at the end of fiscal 2014, as well as the acquisition-related impact attributable to Stuart Weitzman. We expect our rate to be lower in ~~lower tax rate jurisdictions in which income is earned, due~~fiscal 2016 primarily attributable to the ~~increased globalization~~geographic mix of earnings, the ~~Company,~~expiration of certain statutes, the settlement of audits and ~~a lower effective state~~the ongoing benefit of available foreign tax ~~rate.~~

Net income ~~was $1.04 billion in fiscal 2012 compared~~decreased 48.5% or $378.9 million to ~~$880.8~~$402.4 million in fiscal ~~2011. The increase~~2015 as compared to $781.3 million in fiscal 2014. Excluding items of comparability, net income decreased 38.9% or $338.4 million to $531.2 million in fiscal 2015 from $869.6 million in fiscal 2014. This decrease was primarily due to ~~the higher~~lower operating income ~~and a reduction~~partially offset by lower provision for income taxes.

The Company’s reported results are presented in accordance with GAAP. The reported gross profit, SG&A expenses, operating income, income before provision for income taxes, provision for income taxes, net income and earnings per diluted share in fiscal 2014 and 2013 reflect certain items which affect the comparability of our results, as noted in the following reconciliation tables. Refer to page 41 for a discussion on the Non-GAAP Measures.

In fiscal 2014, the Company incurred restructuring and transformation related charges of $131.5 million under its Transformation Plan announced in the fourth quarter of fiscal 2014. The charges recorded in cost of sales and SG&A expenses were $82.2 million and $49.3 million, respectively. These charges, which are primarily associated with our North America business, relate to inventory and fleet related costs, including impairment, accelerated depreciation and severance related to store closures.

In fiscal 2013, the Company incurred restructuring and transformation related charges of $53.2 million. The charges recorded in selling, general and administrative expenses and cost of sales were $48.4 million and $4.8 million, respectively. The charges include the strategic reassessment of the Reed Krakoff business, streamlining our organizational model and reassessing the fleet of our retail stores and inventories.

The change in net sales in fiscal 2014 has been presented both including and excluding currency fluctuation effects (primarily attributable to Coach Japan).

Net sales decreased 5.3% or $269.2 million to $4.81 billion in fiscal 2014. Excluding the effects of foreign currency, net sales decreased 3.1% or $155.9 million. The decrease was driven by lower sales in the North America business partially offset by gains in the International business. The following table presents net sales by ~~operating~~reportable segment for fiscal ~~2011~~2014 compared to fiscal ~~2010:~~

2013:

Comparable store sales measure sales performance at stores that have been open for at least 12 months, and includes sales from ~~coach.com.~~the Internet. Coach excludes new locations from the comparable store base for the first ~~year~~twelve months of operation. ~~Similarly, stores that are expanded~~Comparable store sales have not been adjusted for store expansions given our planned capital investments in connection with the Transformation Plan.

North America Net Sales decreased 10.9% or $377.7 million to $3.10 billion in fiscal 2014. This decrease was primarily driven by ~~15.0% or more are also excluded from the~~lower comparable store ~~base until the first anniversary~~sales of ~~their reopening. Stores that are closed for renovations are removed from the~~$460.5 million or 15% largely due to lower traffic, and lower wholesale sales of $26.1 million due to lower shipments. The Internet business had a negative impact, of over 1%, on comparable store ~~base.~~

~~In North America, net~~ sales ~~increased 14.4% driven by~~which is attributable to the Company's decision to eliminate third-party Internet events and to limit access to our outlet Internet sales from new and expanded stores and by a 10.6% increase in comparable store sales. During fiscal 2011, Coach opened three net new retail stores and 22 new factory stores, and expanded six factory stores in North America. In Japan, net sales increased 5.1% driven by an approximately $69.8 million, or 9.8%, positive impact from foreign currency exchange. During fiscal 2011, Coach opened eight net new locations and expanded three locations in Japan. Coach China results continued to be strong with double-digit percentage growth in comparable store sales. During fiscal 2011, Coach opened 25 net new stores in Hong Kong and mainland China.

~~Indirect~~ — Net sales increased 19.4% to $512.1 million from $428.9 million in fiscal 2010. The increase was driven primarily by an 18.4% increase in Coach International Wholesale and U.S. Wholesale net revenue. The net sales increasesite. This decrease was partially offset by an ~~additional week~~increase of ~~sales~~$143.5 million related to net new stores. In fiscal 2014, Coach opened a net 14 outlet stores, including one Men’s outlet store, and closed a net 19 retail stores.

International Net Sales increased 5.5% or $86.1 million to $1.64 billion in fiscal ~~2010, which represented approximately $8 million. Licensing revenue~~2014. Excluding the unfavorable impact of ~~approximately $24.7~~foreign currency, primarily due to the Japanese yen, net sales increased $191.0 million or 12.3%. The increase in net sales was primarily due to double digit growth in Greater China and ~~$19.2~~Asia, excluding Japan, reflecting an increase of $152.4 million due to net new stores and positive comparable store sales, as well as a $40.5 million increase related to the acquisition of the Europe joint venture in the first quarter of fiscal 2014. In fiscal 2014, excluding the impact of acquisitions, we opened 39 net new stores, with 34 net new stores in mainland China, Hong Kong and Macau and Japan, and five net new stores in the other regions. The acquisition of the European joint venture resulted in a transfer of an additional 18 stores to the Company’s direct control. After the acquisition on July 1, 2013, Coach opened seven new stores and transitioned two stores from wholesale to direct control in fiscal 2014.

Gross profit decreased 10.8% or $401.1 million to $3.30 billion in fiscal 2014 from $3.70 billion in fiscal 2013. Gross margin for fiscal 2014 was 68.6% as compared to 72.9% in fiscal 2013. Excluding items affecting comparability of $82.2 million in fiscal ~~2011~~2014 and $4.8 million in fiscal ~~2010, respectively,~~2013, gross profit decreased 8.7% or $323.7 million to $3.38 billion from $3.70 billion in fiscal 2013, and gross margin was 70.3% in fiscal 2014 as compared to 73.0% in fiscal 2013.

North America Gross Profitdecreased 15.1% or $353.1 million to $1.99 billion in fiscal 2014. Gross margin decreased 310 basis points from 67.4% in fiscal 2013 to 64.3% in fiscal 2014. The decrease in gross margin is ~~included~~due to a 210 basis point decline as a result of increased promotional activity, primarily in ~~Indirect sales.~~

our outlet channel, and a 70 basis point decline as a result of selling products with a higher average unit cost as well as increased penetration of our broadened lifestyle categories.

Corporate Unallocated Gross Profit decreased $92.6 million from $64.7 million in fiscal 2013 to a loss of $27.9 million in fiscal 2014. Excluding items affecting comparability of ~~$25.7~~$82.2 million in fiscal ~~2011, operating income~~2014 and $4.8 million in fiscal 2013, gross profit decreased by $15.2 million from $69.5 million to $54.3 million in fiscal 2014, primarily due to less favorable production variances.

SG&A expenses increased ~~15.7%~~0.2% or $3.3 million to ~~$1.33 billion. Operating margin decreased to 31.4%~~$2.18 billion in fiscal 2014 as compared to 31.9% in the prior year, as gross margin decreased while selling, general, and administrative (“SG&A”) expenses slightly increased as a percentage of sales. Excluding items affecting comparability, operating margin was 32.0% in fiscal 2011.

~~Gross profit increased 14.8% to $3.02~~$2.17 billion in fiscal 2011 from $2.63 billion in fiscal 2010. Gross margin was 72.7% in fiscal 2011 as compared to 73.0% during fiscal 2010. Coach’s gross profit is dependent upon a variety of factors, including changes in the relative sales mix among distribution channels, changes in the mix of products sold, foreign currency exchange rates and fluctuations in material costs. These factors, among, others may cause gross profit to fluctuate from year to year.

SG&A expenses are comprised of four categories: (1) selling; (2) advertising, marketing and design; (3) distribution and consumer service; and (4) administrative. Selling expenses include store employee compensation, store occupancy costs, store supply costs, wholesale account administration compensation and all Coach Japan and Coach China operating expenses. These expenses are affected2013, primarily driven by the number of Coach-operated stores in North America; Japan; Hong Kong, Macau and mainland China open during any fiscal period. Advertising, marketing and design expenses include employee compensation, media space and production, advertising agency fees, new product design costs, public relations and market research expenses. Distribution and consumer service expenses include warehousing, order fulfillment, shipping and handling, customer service and bag repair costs. Administrative expenses include compensation costs for the executive, finance, human resources, legal and information systems departments, corporate headquarters occupancy costs, consulting and software expenses. SG&A expenses increase as the number of Coach-operated stores increase, although an increase in ~~the number of stores generally results in the fixed portion of SG&A expenses being spread over a larger sales base.~~

~~Coach, similar to some companies, includes certain costs related to our distribution network in~~ selling general and administrative expenses rather than in cost of sales; for this reason, our gross margins may not be comparable to that of entities that include all costs related to their distribution network in cost of sales.

During fiscal 2011, SG&A expenses increased 15.8% to $1.72 billion, compared to $1.48 billion during fiscal 2010. Excluding items affecting comparability of $25.7 million in fiscal 2011, SG&A expenses were $1.69 billion.expenses. As a percentage of net sales, SG&A expenses ~~were 41.3% and 41.1%~~increased to 45.3% during fiscal ~~2011 and~~2014 as compared to 42.8% during fiscal ~~2010, respectively.~~2013. Excluding items affecting comparability ~~during~~of $49.3 million in fiscal ~~2011,~~2014 and $48.4 million in fiscal 2013, SG&A expenses increased $2.4 million from fiscal 2013; and SG&A expenses as a percentage of net sales ~~were 40.7%~~increased, primarily due to the increase in selling expenses as ~~we leveraged our selling expense base on higher sales.~~

a percentage of net sales, to 44.3% in fiscal 2014 from 41.9% in fiscal 2013.

Selling expenses were ~~$1.18~~$1.55 billion, or ~~28.5%~~32.2% of net sales, in fiscal 2014 compared to ~~$1.05~~$1.51 billion, or ~~29.1%~~29.8% of net sales, ~~during~~in fiscal ~~2010.~~2013. The dollar increase in selling expenses ~~was due to higher operating expenses~~reflected increases in ~~Coach China and North American stores due to higher sales and~~ new store ~~openings. Additionally, selling~~openings in our International business including the impact of acquiring our former partner Hackett’s 50% interest in our European joint venture. These expenses of Reed Krakoff stores contributed to the dollar increase since the brand was not launched until the beginning of fiscal 2011. Coach China and North American store expenses as a percentage of sales decreased primarily due to operating efficiencies and sales leverage. The decrease in Coach Japan operating expenses in constant currency of $10.2 million waswere mostly offset by ~~the~~a favorable impact of foreign currency exchange rates ~~which increased reported~~primarily related to Coach Japan and lower expenses ~~by approximately $33.5 million.~~

in North America due to the divestiture of the Reed Krakoff business.

Advertising, marketing, and design costs were ~~$224.4 million, or 5.4% of net sales, compared to $179.4~~$242.3 million, or 5.0% of net sales, in fiscal 2014, compared to $265.4 million, or 5.2% of net sales, during fiscal ~~2010.~~2013. The ~~increase~~decrease was primarily due to ~~new~~the divestiture of the Reed Krakoff business. This decrease was partially offset by increased advertising, marketing, and design ~~expenditures and development~~ costs ~~for new merchandising initiatives. Also contributing~~related to the increase were marketing expenses related to consumer communications, which includes our digital strategy through coach.com, our global e-commerce sites, marketing sites and social networking. The Company utilizes and continues to explore implementing new technologies such as our global web presence, with marketing websites in 23 countries, social networking and blogs as cost-effective consumer communication opportunities to increase on-line and store sales and build brand awareness.

Company’s transformation efforts.

Distribution and consumer service expenses ~~were $58.2~~of $87.2 million, or ~~1.4%~~1.8% of net sales, ~~compared to $48.0~~in fiscal 2014, were fairly consistent with fiscal 2013 expenses of $86.1 million, or ~~1.3%~~1.7% of net sales.

Administrative expenses were $300.5 million, or 6.3% of net sales, ~~during~~in fiscal ~~2010. To support our growth in China and the region, during~~

Operating income decreased 26.5% or $404.4 million to $1.12 billion during fiscal 2014 as compared to $1.52 billion in fiscal 2013. Operating margin decreased to 23.3% as compared to 30.0% in fiscal 2013. Excluding items affecting comparability of $131.5 million in fiscal 2014 and $53.2 million in fiscal 2013, operating income decreased 20.7% or $326.1 million to $1.25 billion from $1.58 billion in fiscal 2013; and operating margin was 26.0%, in fiscal 2014 as compared to 31.1% in fiscal 2013.

The following table presents operating income by reportable segment for fiscal 2014 compared to fiscal 2013:

North America Operating Incomedecreased 20.3% or $295.9 million to $1.16 billion in fiscal 2014 reflecting the decrease in gross profit of $353.1 million which was partially offset by lower SG&A expenses of $57.2 million. The decrease in SG&A expenses was related to the absence of costs in fiscal 2014 related to the divestiture of the Reed Krakoff business and lower variable selling costs as a result of lower sales. Operating margin decreased 450 basis points to 37.5% in fiscal 2014 from 42.0% during

International Operating Incomedecreased 4.6% or $26.5 million to $555.7 million primarily reflecting higher SG&A expenses of $66.5 million partially offset by higher gross profit of $40.0 million. The increase in ~~administrative~~SG&A expenses is related to a $53.7 million increase in Greater China and Asia, excluding Japan, related to higher occupancy and employee costs associated with new store openings and a $45.8 million increase as a result of the recently acquired Europe business. The increase in SG&A costs was offset by foreign currency effects in Japan of $42.6 million. Operating margin decreased 360 basis points to 33.8% in fiscal 2014 from 37.4% during the same period in the prior year primarily due to lower gross margin of 180 basis points and higher ~~share-based and performance-based compensation.~~

Corporate Unallocated Operating Expense increased $86.2 million to $633.9 million, an increase of 15.7%. This increase was primarily attributable to higher charges incurred by the Company in fiscal 2014 as part of its Transformation Plan. Excluding items affecting comparability, unallocated operating expenses increased by 1.6% or $7.9 million to $502.4 million from $494.5 million.

The effective tax rate was ~~32.3%~~30.4% in fiscal ~~2011~~2014, as compared to ~~36.5%~~32.0% in fiscal ~~2010.~~2013. Excluding ~~the benefit from~~ the items affecting comparability, the effective tax rate was ~~33.6%~~30.6% and 32.2% in fiscal ~~2011. The decrease~~2014 and fiscal 2013, respectively. Both fiscal 2014 and fiscal 2013 benefited from one-time discrete items. In fiscal 2014, the Company recognized a net benefit related to refinements of its various tax accounts which were partially offset by the loss of deductions related to changes in key executives. During fiscal 2013, the Company recognized a favorable tax settlement and the benefit of certain permanent adjustments related to executive compensation. These one-time discrete items favorably impacted our effective tax rate ~~is primarily attributable to a favorable settlement of a multi-year tax return examination~~by approximately 220 basis points and ~~higher profitability~~40 basis points in ~~lower tax rate jurisdictions in which income is earned, due to the increased globalization of the Company,~~fiscal 2014 and ~~a lower effective state tax rate.~~

Net income ~~was $880.8~~decreased 24.5% or $253.1 million to $781.3 million in fiscal ~~2011~~2014 as compared to ~~$734.9~~$1.03 billion in fiscal 2013. Excluding items of comparability, net income decreased 18.5% or $197.4 million to $869.6 million in fiscal ~~2010. The increase~~2014 from $1.07 billion in fiscal 2013. This decrease was primarily due to ~~the higher~~lower operating income ~~and a reduction~~partially offset by lower provision for income taxes.

The Company’s reported results are presented in accordance with ~~U.S. Generally Accepted Accounting Principles (“GAAP”).~~GAAP. The reported gross profit, SG&A expenses, operating income, ~~and~~ provision for income taxes, net income and earnings per diluted share in fiscal ~~2012~~2015, fiscal 2014 and ~~2011~~fiscal 2013 reflect certain items which affect the comparability of our ~~results. Similarly,~~results, including the ~~reported SG&A expenses, operating income, provision for income taxes, income from continuing operations, net income~~impact of the Transformation Plan and ~~earnings per diluted share from continuing operations in both fiscal 2009 and fiscal 2008 reflect certain items which affect the comparability of our results.~~acquisition-related charges. These metrics are also reported on a non-GAAP basis ~~for these fiscal years~~ to exclude the impact of these items.

These non-GAAP performance measures were used by management to conduct and evaluate its business during its regular review of operating results for the periods affected. Management and the Company’s Board utilized these non-GAAP measures to make decisions about the uses of Company resources, analyze performance between periods, develop internal projections and measure management performance. The Company’s primary internal financial reporting excluded these items affecting comparability. In addition, the compensation committee of the Company’s Board ~~used~~will use these non-GAAP measures when setting and assessing achievement of incentive compensation goals.

Additionally, certain increases and decreases in operating results for the Company and its North America and International segment have been presented both including and excluding currency fluctuation effects from translating foreign-denominated amounts into U.S. dollars and compared to the same period in the prior fiscal year.

We believe these non-GAAP measures are useful to investors in evaluating the Company’s ongoing operating and financial results and understanding how such results compare with the Company’s historical performance. ~~In addition,~~Additionally, we believe presenting certain increases and decreases that include and exclude the effect of foreign currency fluctuations helps investors and analysts understand the effect of significant year-over-year currency fluctuations. We believe excluding the items affecting comparability assists investors in developing expectations of future performance. ~~These items affecting comparability do not represent the Company’s direct, ongoing business operations.~~ By providing the non-GAAP measures, as a supplement to GAAP information, we believe we are enhancing investors’ understanding of our business and our results of operations. The non-GAAP financial measures are limited in their usefulness and should be considered in addition to, and not in lieu of, U.S. GAAP financial measures. Further, these non-GAAP measures may be unique to the Company, as they may be different from non-GAAP measures used by other companies.

For a detailed discussion on these non-GAAP measures, see Item 6. "Selected Financial Data," and the Results of Operations section within Item 7. "Management’s Discussion and Analysis of Financial Condition and Results of Operations."

The ~~year-over-year comparisons~~Company’s cash and cash equivalents increased $699.9 million in fiscal 2015 compared to a decrease of ~~our financial results are affected by the following items included~~$470.9 million in ~~our reported results:~~

Fiscal Year Ended
   (dollars in millions, except per share data)
   June 30, 2012 July 2, 2011 June 27, 2009 June 28, 2008
Operating income

Cost savings measures $ — $ — $ (13.4 ) $ —
Charitable foundation contribution (39.2 ) (25.7 ) (15.0 ) (20.0 )
Variable expense — — — (12.1 )
Total Operating income impact $ (39.2 ) $ (25.7 ) $ (28.4 ) $ (32.1 )
Provision for income taxes

Cost savings measures $ — $ — $ (5.1 ) $ —
Charitable foundation contribution (15.3 ) (10.2 ) (5.7 ) (7.8 )
Tax adjustments (23.9 ) (15.5 ) (18.8 ) (60.6 )
Variable expense — — — (4.7 )
Total Provision for income taxes impact $ (39.2 ) $ (25.7 ) $ (29.6 ) $ (73.1 )
Net income

Cost savings measures $ — $ — $ (8.3 ) $ —
Charitable foundation contribution 23.9 (15.5 ) (9.3 ) (12.2 )
Tax adjustments (23.9 ) 15.5 18.8 60.6
Variable expense — — — (7.4 )
Total Net income impact $ 0.0 $ 0.0 $ 1.2 $ 41.0
Diluted earnings per share

Cost savings measures $ — $ — $ (0.03 ) $ —
Charitable foundation contribution 0.08 (0.05 ) (0.03 ) (0.03 )
Tax adjustments (0.08 ) 0.05 0.06 0.17
Variable expense — — — (0.02 )
Total Diluted earnings per share impact $ 0.00 $ 0.00 $ 0.00 $ 0.11

~~During~~ fiscal ~~2012, the Company decreased the provision for income taxes by $23.9 million,~~2014, primarily ~~as a result of recording the effect of a revaluation of certain deferred tax asset balances~~ due to ~~a change in Japan’s corporate tax laws and the favorable settlement of a multi-year transfer pricing agreement with Japan. The Company used the~~ net income favorability to contribute an aggregate $39.2 million to the Coach Foundation. The Company believed that in order to reflect the direct results of the normal, ongoing business operations, both the tax adjustments and the resulting Coach Foundation funding needed to be adjusted. This exclusion is consistent with the way management views its results and is the basis on which incentive compensation was calculated for fiscal 2012.

~~During the third quarter of fiscal 2011, the Company decreased the provision for income taxes~~cash provided by $15.5 million, primarily as a result of a favorable settlement of a multi-year tax return examination. The Company used the net income favorability to contribute $20.9 million to the Coach Foundation and 400 million yen or $4.8 million to the Japanese Red Cross Society. The Company believed that in order to reflect the direct results of the normal, ongoing business operations, both the tax adjustments and the resulting Coach Foundation funding and Japanese Red Cross Society contribution needed to be adjusted. This exclusion is consistent with the way management views its results and is the basis on which incentive compensation was calculated and paid for fiscal 2011.

Net cash provided by operating activities ~~was $1.22 billion in fiscal 2012 compared to $1.03 billion in fiscal 2011. The increase of $188.4~~decreased $48.0 million ~~was~~ primarily due to ~~the $158.1 million increase in~~lower net income ~~as well as the result~~ of ~~working capital~~$378.9 million from fiscal 2014 to fiscal 2015, partially offset by changes ~~between the two fiscal years, the most significant~~in our operating asset and liability balances of ~~which~~

$331.4 million.

Net cash used in investing activities was ~~$259.4~~$612.9 million in fiscal ~~2012~~2015 compared to ~~$59.6~~$707.7 million in fiscal ~~2011, with~~2014. The decrease in net cash used of $94.8 million was primarily due to the ~~increase~~impact of ~~$199.8 million largely driven by acquisitions, higher planned capital~~net proceeds from our investment ~~and the timing~~portfolio of cash investments. During fiscal 2012, the Company acquired 100% of its domestic retail businesses in Singapore and Taiwan from the former distributors for an aggregate $53.2 million, net of cash acquired. Purchases of property and equipment were $184.3$255.6 million in fiscal ~~2012, which was $36.6~~2015, compared to net cash used for purchase of investments of $397.1 million ~~higher than~~in fiscal ~~2011, reflecting planned increased capital investment. In addition, during fiscal 2012,~~2014, offset by an increase in net cash used of $515.8 million in cash used for acquisitions, related to the ~~Company provided $24.1 million of loan advances in connection with its European joint venture operations, to fund expansion plans~~Stuart Weitzman acquisition in the ~~region.~~

fourth quarter of fiscal 2015, as well as an increase in net cash used of $51.9 million related to increased investments in the Hudson Yards joint venture.

Net cash provided by financing activities was ~~$741.9~~$389.3 million in fiscal ~~2012~~2015 as compared to ~~$875.1~~a use of cash of $748.1 million in fiscal ~~2011. The decrease~~2014. This increase of ~~$133.2~~cash provided of $1,137.4 million was primarily ~~attributable~~due to ~~$398.0~~the debt borrowings described in Note 11, "Debt", as well as the absence of cash used for share repurchases during fiscal 2015. The Company received $896.7 million ~~less expended for common stock repurchases,~~in proceeds from long term debt, net of discount, which was partially offset by ~~$192.4~~net repayments of $140 million ~~lower~~under the Company's Amended and Restated Credit Agreement during fiscal 2015, compared to $140 million of net ~~proceeds from exercises of~~borrowings during fiscal 2014. Furthermore, the Company used $524.9 million for share ~~based awards and $82.2 million higher dividend payments~~repurchases in fiscal ~~2012, due~~2014, compared to ~~the higher dividend payment rate.~~

~~Through June 18, 2012, the Company maintained a $100 million revolving credit facility with certain lenders~~no stock repurchases occurring in fiscal 2015.

As of June ~~30, 2012,~~27, 2015, in addition to our cash flows generated from our operations, our sources of liquidity and capital resources were comprised of the following (in millions):

We have the ability to draw on our credit facilities or access other sources of financing options available to us in the credit and capital markets for, among other things, funding our investment in the Hudson Yards joint venture, our transformation-related initiatives, acquisition or integration-related costs, settlement of a material contingency, or a material adverse business or macroeconomic development, as well as for ~~working capital and~~other general corporate purposes, Coach Japan has available credit facilities with several Japanese financial institutions. These facilities allow a maximum borrowing of 4.1 billion yen, or approximately $52 million, at June 30, 2012. Interest is based on the Tokyo Interbank rate plus a margin of 27.5 to 30 basis points. During fiscal 2012 and 2011, the peak borrowings were $0 and $27.1 million, respectively. As of June 30, 2012 and July 2, 2011, there were no outstanding borrowings under the Japanese credit facilities.

To provide funding for working capital and general corporate purposes, Coach Shanghai Limited has a credit facility that allows a maximum borrowing of 63 million Chinese renminbi, or approximately $10 million, at June 30, 2012. Interest is based on the People's Bank of China rate. During fiscal 2012 and fiscal 2011, there were no borrowings under this credit facility. Accordingly, at June 30, 2012 and July 2, 2011, there were no outstanding borrowings under this facility.

During fiscal 2011, the Company completed its $1.0 billion common stock repurchase program, which was put into place in April 2010. In January 2011, the Board approved a new common stock repurchase program to acquire up to $1.5 billion of Coach’s outstanding common stock through June 2013. Purchases of Coach common stock are made subject to market conditions and at prevailing market prices, through open market purchases. Repurchased shares become authorized but unissued shares and may be issued in the future for general corporate and other uses. The Company may terminate or limit the stock repurchase program at any time.

During fiscal 2012 and fiscal 2011, the Company repurchased and retired 10.7 million and 20.4 million shares, respectively, or $0.70 billion and $1.10 billion of common stock, respectively, at an average cost of $65.49 and $53.81, respectively. As of June 30, 2012, $261.6 million remained available for future purchases under the existing program.

In fiscal 2012, total capital expenditures were $184.3 million related primarily to new stores and corporate infrastructure in North America, China, and Japan which accounted for approximately $58.4 million, $35.4, and $10.4 million, respectively, of total capital expenditures. Spending on department store renovations and distributor locations accounted for approximately $9.9 million of the total capital expenditures. The remaining capital expenditures related to corporate systems and infrastructure. These investments were financed from on hand cash and operating cash flows.

For the fiscal year ending June 29, 2013, the Company expects total capital expenditures to be approximately $250 million. Capital expenditures will be primarily for new stores in North America, Asia and technology to support our global expansion. We will also continue to invest in corporate infrastructure and department store and distributor locations. These investments will be financed primarily from on hand cash and operating cash flows.

Coach experiences significant seasonal variations in its working capital requirements. During the first fiscal quarter Coach builds inventory for the holiday selling season, opens new retail stores and generates higher levels of trade receivables. In the second fiscal quarter its working capital requirements are reduced substantially as Coach generates consumer sales and collects wholesale accounts receivable. In fiscal 2012, Coach purchased approximately $1.4 billion of inventory, which was primarily funded by on hand cash and operating cash flows.

business purposes.

Management believes that cash ~~flow~~flows from operations, access to the credit and ~~on hand~~capital markets and our credit lines, on-hand cash and cash equivalents and our investments will provide adequate funds to support our operating, capital, and debt service requirements for the foreseeable ~~working capital needs, planned capital expenditures, dividend payments~~future, our plans for acquisitions, further business expansion and ~~the common stock repurchase program. Any future~~transformation-related initiatives. Future events, such as acquisitions or joint ventures, orand other similar transactions may require additional

In April 2013 the Company entered into a joint venture agreement with the Related Companies, L.P. to develop a new office tower in Manhattan in the Hudson Yards district. The formation of the joint venture serves as a financing vehicle for the project, with the Company owning less than 43% of the joint venture. Upon completion of the office tower, the Company will retain a condominium interest serving as its new corporate headquarters. During fiscal 2015 the Company invested $139.1 million in the joint venture. Since the formation of the Hudson Yards joint venture, the Company has invested $320.2 million in the joint venture. The Company expects to further invest approximately $210 million, the significant majority of which will be by the end of fiscal 2016, depending on construction progress. In addition to its investment in the joint venture, Coach is directly investing in a portion of the design and build-out of the new corporate headquarters and has incurred $34.0 million of capital expenditures to date, including $5.9 million in fiscal 2015, and expects to incur approximately $185 million over the remaining period of construction.

On January 5, 2015, the Company entered into a purchase agreement with Stuart Weitzman Topco LLC and Stuart Weitzman Intermediate LLC, a wholly owned subsidiary of Topco. On May 4, 2015, the acquisition was consummated. Under the terms of the Stuart Weitzman purchase agreement, Coach purchased all of the equity interests of Stuart Weitzman Intermediate LLC, a luxury footwear company and the parent of Stuart Weitzman Holdings, LLC, from Topco for an aggregate payment of approximately $531.1 million in cash, subject to customary purchase price adjustments, as well as a potential earnout of up to $14.7 million annually in cash over the next three calendar years based on the achievement of certain revenue targets. On May 4, 2015, the Company funded the acquisition through cash on-hand, including the utilization of a portion of debt related proceeds, as described in Note 11, "Debt." Refer to Note 7, "Acquisitions," for further discussion on the Stuart Weitzman acquisition.

Because Coach products are frequently given as gifts, we experience seasonal variations in net sales, operating cash flows and working capital requirements, primarily related to seasonal holiday shopping. During the first fiscal quarter, we build inventory for the holiday selling season. In the second fiscal quarter, our working capital requirements are reduced substantially as we generate higher net sales and operating income, especially during the holiday months of November and December. Fluctuations in net sales, operating income and operating cash flows in any fiscal quarter may be affected by other events affecting retail sales, such as changes in weather patterns or other macroeconomic events.

In October 2012, the ~~Company had letters~~Company’s Board of ~~credit available~~Directors approved a common stock repurchase program to acquire up to $1.5 billion of ~~$600 million, of which $215.4 million were outstanding. These letters of credit, which expire at various dates~~Coach’s outstanding common stock through ~~2014, primarily collateralize the Company’s obligation to third parties for the purchase of inventory.~~

June 2015. As of June ~~30, 2012,~~27, 2015, the program has expired.

Purchases of Coach common stock are made subject to market conditions and at prevailing market prices, through open market purchases. Under Maryland law, Coach’s ~~long-term~~state of incorporation, treasury shares are not allowed. As a result, all repurchased shares are retired when acquired.

During fiscal 2015, the Company did not repurchase or retire any shares. During fiscal 2014, the Company repurchased and retired 10.2 million shares, or $524.9 million of common stock, at an average cost of $51.27.

Excluded from the above contractual obligations table is the non-current liability for unrecognized tax benefits of $185.7 million as of June 27, 2015, as we cannot make a reliable estimate of the period in which the liability will be settled, if ever. The above table ~~above~~also excludes ~~the following:~~ amounts included in current liabilities ~~other than the current portion of long-term debt,~~ in the Consolidated Balance Sheet at June ~~30, 2012~~27, 2015 as these items will be paid within one ~~year;~~year, certain long-term liabilities not requiring cash payments and cash contributions for the Company’s pension plans. ~~The~~

In addition to the commitments included in the table above, we have outstanding letters of credit $6.8 million as of June 27, 2015, primarily serving to collateralize our obligation to third parties for insurance claims and store leases. These letters of credit expire at various dates through 2016.

As discussed earlier, the Company ~~intends to contribute approximately $0.4 million to its pension plans during the next year. The above table also excludes reserves recorded in accordance~~entered into a joint venture agreement with the ~~Financial Accounting Standards Board’s (“FASB”) guidance~~Related Companies, L.P. to develop a new office tower in Manhattan in the Hudson Yards district, in April 2013. The formation of the Hudson Yards joint venture serves as a financing vehicle for ~~accounting~~the project. Construction of the new building has commenced and upon expected completion of the office tower in fiscal 2016, the Company will retain a condominium interest serving as its new corporate headquarters. The Company’s maximum loss exposure is limited to the committed capital.

We do not maintain any other off-balance sheet arrangements, transactions, obligations, or other relationships with unconsolidated entities that would be expected to have a material current or future effect on our consolidated financial statements. Refer to Note 12, "Commitments and Contingencies," to the accompanying audited consolidated financial statements for uncertainty in income taxes which has been codified within Accounting Standards Codification (“ASC”) 740, as we are unable to reasonably estimate the timing of future cash flows related to these reserves.

Coach does not have any off-balance-sheet financing or unconsolidated special purpose entities. Coach’s risk management policies prohibit the use of derivatives for trading or speculative purposes. The valuation of financial instruments that are marked-to-market are based upon independent third-party sources.

Coach is party to an Industrial Revenue Bond related to its Jacksonville, Florida distribution and consumer service facility. This loan has a remaining balance of $1.4 million and bears interest at 4.5%. Principal and interest payments are made semiannually, with the final payment due in 2014.

During fiscal 2009, Coach assumed a mortgage in connection with the purchase of its corporate headquarters building in New York City. This mortgage bears interest at 4.68%. Interest payments are made monthly and principal payments began in July 2009, with the final payment of $21.6 million due in June 2013. As of June 30, 2012, the remaining balance on the mortgage was $21.9 million.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and ~~assumptions.~~assumptions that affect our results of operations, financial condition and cash flows as well as the disclosure of contingent assets and liabilities as of the date of the Company's financial statements. Actual results could differ from estimates in amounts that may be material to the financial statements. Predicting future events is

The accounting policies discussed below are considered critical because changes to certain judgments and assumptions inherent in these policies could affect the financial statements. For more information on ~~Coach’s~~the Company's accounting policies, please refer to the Notes to Consolidated Financial Statements.

Revenue is recognized by the Company when there is persuasive evidence of an arrangement, delivery has occurred (and risks and rewards of ownership have been transferred to the buyer), price has been fixed or is determinable, and collectability is reasonably assured.

Retail store and concession-based shop-in-shop revenues are recognized at the point of sale, which occurs when merchandise is sold in an over-the-counter consumer transaction. These revenues are recognized net of estimated returns at the time of sale to consumers. Internet revenue from sales of products ordered through the Company’s e-commerce sites is recognized upon delivery and receipt of the shipment by its customers and includes shipping and handling charges paid by customers. Internet revenue is also reduced by an estimate for returns.

Wholesale revenue is recognized at the time title passes and risk of loss is transferred to customers. Wholesale revenue is recorded net of estimates of returns, discounts and markdown allowances. Returns and allowances require pre-approval from management and discounts are based on trade terms. Estimates for markdown reserves are based on historical trends, actual and forecasted seasonal results, an evaluation of current economic and market conditions, retailer performance, and, in certain cases, contractual terms. The Company reviews and refines these estimates on at least a quarterly basis. The Company’s ~~effective tax rate is based on pre-tax income, statutory tax rates, tax laws and regulations, and tax planning strategies available~~historical estimates of these costs have not differed materially from actual results.

At June 27, 2015, a 10% change in the ~~various jurisdictions~~allowances for estimated uncollectible accounts, markdowns and returns would have resulted in an insignificant change in the Company's reserves and net sales.

Gift cards issued by the Company are recorded as a liability until they are redeemed, at which ~~Coach operates. Deferred tax assets are reported at net realizable value, as determined~~point revenue is recognized. The Company recognizes income for unredeemed gift cards when the likelihood of a gift card being redeemed by ~~management. Significant management judgment~~a customer is ~~required in determining~~remote, which is approximately two years after the ~~effective tax rate, in evaluating our tax positions~~gift card is issued, and ~~in determining~~ the ~~net realizable~~Company determines that it does not have a legal obligation to remit the value of ~~deferred tax assets. In accordance~~the unredeemed gift card to the relevant jurisdiction as unclaimed or abandoned property. Revenue associated with ~~ASC 740-10, the Company recognizes the impact of tax positions in the financial statements if those positions will more likely than~~gift card breakage is not ~~be sustained on audit, based on the technical merits of the position. Tax authorities periodically audit~~material to the Company’s income tax returns. Management believes that our tax filing positions are reasonable and legally supportable. However, in specific cases, various tax authorities may take a contrary position. A change in our tax positions or audit settlements could have a significant impact on our results of operations. For further information about income taxes, see the Income Taxes note presented in the Notes to the Consolidated Financial Statements.

The Company’s inventories are reported at the lower of cost or market. Inventory costs include material, conversion costs, freight and duties and are primarily determined by the first-in, first-out method. The Company reserves for inventory, including slow-moving and aged inventory, based on ~~historical experience,~~ current product demand, ~~and~~ expected future ~~demand.~~demand and historical experience. A decrease in product demand due to changing customer tastes, buying patterns or increased competition could impact ~~Coach’s~~the Company's evaluation of its ~~slow-moving and aged~~ inventory and additional reserves might be required. Estimates may differ from actual results due to the quantity, quality and mix of products in inventory, consumer and retailer preferences and market conditions. At June ~~30, 2012,~~27, 2015, a 10% change in the inventory reserve, ~~for slow-moving and aged inventory~~excluding amounts associated with the Transformation Plan, would have resulted in an insignificant change in inventory and cost of ~~goods sold.~~

In connection with an acquisition, we are required to record all assets acquired and liabilities assumed of the acquired business at their acquisition date fair value, including the recognition of contingent consideration at fair value on the acquisition date. These fair value determinations require our judgment and may involve the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates, asset lives, and market multiples, among other items. We may utilize independent third-party valuation firms to assist in making these fair value determinations. Refer to Note 7, "Acquisitions," for detailed disclosures related to our acquisitions.

Goodwill and certain other intangible assets deemed to have indefinite useful lives, including trademarks and trade names, are not amortized, but are assessed for impairment at least annually. Finite-lived intangible assets are amortized over their respective estimated useful lives and, and along with other long-lived assets as noted above, are evaluated for impairment periodically whenever events or changes in circumstances indicate that their related carrying values may not be fully recoverable. Estimates of fair value for finite-lived intangible assets are primarily determined using discounted cash flows, with consideration of market comparisons and recent transactions. This approach may use significant estimates and assumptions, including projected future cash flows, discount rates and growth rates.

The Company ~~evaluates~~generally performs its annual goodwill and ~~other indefinite life~~indefinite-lived intangible assets ~~annually for impairment. In order to complete our~~ impairment analysis ~~we must perform~~using a ~~valuation analysis which includes determining~~qualitative approach to determine whether it is more likely than not that the fair values of such assets are less than their respective carrying values. If, based on the results of the qualitative assessment, it is concluded that it is not more likely than not that the fair value of the ~~Company’s~~asset exceeds its carrying value, a quantitative test is performed. The quantitative goodwill impairment test is a two-step process. The first step is to identify the existence of potential impairment by comparing the fair value of each reporting ~~units~~unit with its carrying value, including goodwill. If the fair value of a reporting unit exceeds its carrying value, the reporting unit's goodwill is considered not to be impaired and performance of the second step of the quantitative goodwill impairment test is unnecessary.

If the carrying value of a reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step of the goodwill impairment test compares the implied fair value of the reporting unit’s goodwill with the carrying value of that goodwill. If the carrying value of the reporting unit’s goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. The implied fair value of goodwill is determined in the same manner as the amount of goodwill that would be recognized in a business combination. In other words, the fair value of the reporting unit is allocated to all of the assets and liabilities of that unit as if the reporting unit had been acquired in a business combination and the fair value was the purchase price paid to acquire the reporting unit.

Determination of the fair value of a reporting unit and the fair value of individual assets and liabilities of a reporting unit is based on management's assessment, considering independent third-party appraisals when necessary. Furthermore, this determination is judgmental in nature and often involves the use of significant estimates and assumptions. These estimates and assumptions could have a significant impact on whether or not an impairment charge is recognized and the amount of any such charge. Estimates of fair value are primarily determined using discounted cash ~~flows. This analysis contains uncertainties as it requires management to make~~flows, market comparisons, and recent transactions. These approaches use significant estimates and assumptions, including projected future cash flows, discount rates, growth rates, and ~~estimate~~determination of appropriate market comparables.

The Company performs its annual impairment assessment of goodwill, including trademarks and trade names, during the ~~profitability~~fourth quarter of ~~future growth strategies.~~each fiscal year. The Company determined that there was no impairment in fiscal ~~2012,~~2015, fiscal ~~2011~~2014 or fiscal ~~2010.~~

Long-lived assets, such as property and equipment, are evaluated for impairment whenever events or circumstances indicate that the carrying value of the assets may not be recoverable. ~~The evaluation is based on a review~~In evaluating long-lived assets for recoverability, the Company uses its best estimate of ~~forecasted operating~~future cash flows ~~and~~expected to result from the ~~profitability~~use of the ~~related~~ asset ~~group. An~~and its eventual disposition. To the extent that estimated future undiscounted net cash flows attributable to the asset are less than its carrying value, an impairment loss is recognized ifequal to the ~~forecasted~~difference between the carrying value of such asset and its fair value, considering external market participant assumptions.

In determining future cash flows, ~~are less than~~Coach takes various factors into account, including changes in merchandising strategy, the ~~carrying amount~~emphasis on retail store cost controls, the effects of macroeconomic trends such as consumer spending, the impacts of the ~~asset. The Company recorded an impairment loss in fiscal 2009~~experienced level of ~~$1.5 million related to~~retail store managers, the ~~closure~~level of ~~three underperforming stores. The Company did not record any impairment losses in fiscal 2012, fiscal 2011 or fiscal 2010. However, as~~advertising, promotional cadence and in-store capital investments. Since the determination of future cash flows is ~~based on expected~~an estimate of future performance, ~~impairment could result~~there may be future impairments in the event that future ~~if expectations are~~cash flows do not ~~met.~~

Sales are recognized at the point of sale, which occurs when merchandise is sold in an over-the-counter consumer transaction or, for the wholesale channels, upon shipment of merchandise, when title passes to the customer. Revenue associated with gift cards is recognized upon redemption. The Company estimates the amount of gift cards that will not be redeemed or remitted as escheatable property, based on historical

meet expectations.

The Company recognizes the cost of ~~employee services received in exchange for~~equity awards ~~of equity instruments, such as stock options,~~to employees and the non-employee Directors based on the grant-date fair value of those awards. The grant-date fair values of share unit awards are based on the fair value of the Company's common stock on the date of grant. The grant-date fair value of stock option awards is determined using the Black-Scholes option pricing model and involves several assumptions, including the expected term of the option, expected volatility and dividend yield. The expected term of options represents the period of time that the options granted are expected to be outstanding and is based on historical experience. Expected volatility is based on historical volatility of the Company’s stock as well as the implied volatility from publicly traded options on ~~Coach’s~~the Company's stock. Dividend yield is based on the current expected annual dividend per share and the Company’s stock price. Changes in the assumptions used to determine the Black-Scholes value could result in significant changes in the Black-Scholes value. ~~However,~~

For stock options and share unit awards, the Company recognizes share-based compensation net of estimated forfeitures and revises the estimates in subsequent periods if actual forfeitures differ from the estimates. We estimate the forfeiture rate based on historical experience as well as expected future behavior.

The Company grants performance-based share awards to certain key executives, the vesting of which is subject to the executive’s continuing employment and the Company's achievement of certain performance goals. On a quarterly basis, the Company assesses actual performance versus the predetermined performance goals, and adjusts the share-based compensation

A hypothetical 10% change in ~~the Black-Scholes value~~our stock-based compensation expense would have ~~resulted~~affected our fiscal 2015 net income by approximately $7 million.

The Company’s effective tax rate is based on pre-tax income, statutory tax rates, tax laws and regulations, and tax planning strategies available in ~~an insignificant change~~the various jurisdictions in ~~fiscal 2012 share-based compensation expense.~~

The Company recognizes the impact of tax positions in the financial statements if those positions will more likely than not be sustained on audit, based on the technical merits of the position. Although we believe that the estimates and assumptions we use are reasonable and legally supportable, the final determination of tax audits could be different than that which is reflected in historical tax provisions and recorded assets and liabilities. Tax authorities periodically audit the Company’s income tax returns, and in specific cases, the tax authorities may take a contrary position that could result in a significant impact on our results of operations. Significant management judgment is required in determining the effective tax rate, in evaluating our tax positions and in determining the net realizable value of deferred tax assets.

See Note 2, "Significant Accounting ~~Standards Codification 820-10 “~~~~Fair Value Measurements and Disclosures~~~~,” was amended~~Policies," to ~~clarify certain disclosure requirements and improve consistency with international reporting standards. This amendment is to be applied prospectively and was effective for~~ the ~~Company beginning January 1, 2012. The adoption of this amendment did not have a material effect on the Company’s~~accompanying audited consolidated financial ~~statements.~~

~~Accounting Standards Codification Topic 220, “~~~~Comprehensive Income~~~~,” was amended in June 2011 to require entities to present the total~~statements for a description of ~~comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income~~certain recently issued or in two separate but consecutive statements. The amendment does not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income under current GAAP. This guidance is effective for the Company’s fiscal year and interim periods beginning July 1, 2012. The Company is currently evaluating this guidance, but does not expect its adoption to have a material effect on itsproposed accounting standards which may impact our consolidated financial ~~statements.~~

~~In September 2011, Accounting Standards Codification 350-20, “~~~~Intangibles — Goodwill and Other — Goodwill~~,” was amended to allow entities to assess qualitative factors to determine if it is more-likely-than-not that goodwill might be impaired, and whether it is necessary to perform the two-step goodwill impairment test required under current accounting standards. This guidance is effective for the Company’s fiscal year beginning July 1, 2012. The Company does not expect its adoption to have a material effect on its consolidated financial statements.

statements in future reporting periods.

The market risk inherent in our financial instruments represents the potential loss in fair value, earnings or cash flows, arising from adverse changes in ~~interest~~foreign currency exchange rates or ~~foreign currency exchange~~interest rates. Coach manages these exposures through operating and financing activities and, when appropriate, through the use of derivative financial ~~instruments with respect to Coach Japan and Coach Canada.~~instruments. The use of derivative financial instruments is in accordance with ~~Coach’s~~the Company's risk management ~~policies. Coach does~~policies, and we do not enter into derivative transactions for speculative or trading purposes.

The ~~following~~ quantitative disclosures in the following discussion are based on quoted market prices obtained through independent pricing sources for the same or similar types of financial instruments, taking into consideration the underlying

Foreign currency exposures arise from transactions, including firm commitments and anticipated contracts, denominated in a currency other than the entity’s functional currency, and from foreign-denominated revenues and expenses translated into U.S. dollars.

~~Substantially all~~ The majority of ~~Coach’s fiscal 2012 non-licensed product needs are purchased from independent manufacturers in countries other than~~ the United States, including China, Vietnam, India, Philippines, Thailand, Italy, Taiwan, Peru, Malaysia, Columbia, Turkey and Great Britain. Additionally, sales are made through international channels to third party distributors. Substantially allCompany's purchases and sales involving international parties, excluding international consumer sales, ~~at Coach Japan, Coach Canada, Coach China, Coach Singapore, and Coach Taiwan~~ are denominated in U.S. dollars and, therefore, ~~are not subject to~~our foreign currency exchange ~~risk.~~

~~In Japan and Canada, Coach~~risk is limited. The Company is exposed to ~~market~~ risk from foreign currency exchange rate fluctuations resulting from ~~Coach Japan and Coach Canada’s~~its operating subsidiaries’ U.S. dollar and Euro denominated inventory purchases. To mitigate such risk, Coach Japan and Coach Canada enter into ~~certain~~ foreign currency derivative contracts, primarily zero-cost collar options ~~to manage these risks.~~and forward foreign currency contracts. As of June ~~30, 2012~~27, 2015 and ~~July 2, 2011, open~~June 28, 2014, zero-cost collar options and forward foreign currency ~~forward~~exchange contracts designated as cash flow hedges with a notional amount of ~~$310.9~~$126.7 million and ~~$171.0~~$90.2 million, respectively, were outstanding.

~~Coach had exposure to market risk from foreign currency exchange rate fluctuations with respect to Coach Japan as~~ As a result of ~~its $65.0 million U.S. dollar-denominated fixed rate intercompany loan.~~the use of derivative instruments, we are exposed to the risk that counterparties to the derivative instruments will fail to meet their contractual obligations. To ~~manage this~~mitigate the counterparty credit risk, we only enter into derivative contracts with carefully selected financial institutions. The Company also reviews the creditworthiness of our counterparties on ~~December 29, 2011, Coach Japan entered into~~ a ~~cross-currency swap transaction,~~regular basis. As a result of the ~~terms~~above considerations, we do not believe that we are exposed to any undue concentration of ~~which included an exchange~~counterparty credit risk associated with our derivative contracts as of ~~Japanese yen fixed interest for U.S. dollar fixed interest.~~ June 27, 2015.

The ~~loan and swap were settled at maturity in June 2012, at which point the swap required an exchange of Japanese yen and U.S. dollar based notional values.~~

~~Coach~~Company is also exposed to market risk from foreign currency exchange rate fluctuations with respect to various cross-currency intercompany loans which are not long term in investment nature. This primarily includes exposure to exchange rate fluctuations in the Singapore Dollar, the Euro, the British Pound Sterling, the New Taiwan Dollar and ~~related party loans. These loans are denominated in various foreign currencies, with a total notional value of approximately $207 million as of June 30, 2012.~~the Malaysian Ringgit. To manage the exchange rate risk related to these loans, the Company ~~entered~~primarily enters into forward exchange and cross-currency swap ~~contracts,~~contracts. As of June 27, 2015 and June 28, 2014, the ~~terms~~total notional values of ~~which include the exchange of~~outstanding forward foreign currency ~~fixed interest for U.S. dollar fixed interest~~exchange and ~~an exchange of the foreign currency~~cross-currency swap contracts related to these loans were $25.8 million and ~~U.S. dollar based notional values at the maturity dates of the contracts, the latest of which is June 2013.~~

$13.2 million, respectively.

The fair value of ~~open~~outstanding foreign currency derivatives included in current assets at June ~~30, 2012~~27, 2015 and ~~July 2, 2011~~June 28, 2014 was ~~$1.5~~$3.4 million and ~~$2.0~~$0.5 million, respectively. The fair value of ~~open~~outstanding foreign currency derivatives included in current liabilities at June ~~30, 2012~~27, 2015 and ~~July 2, 2011~~June 28, 2014 was ~~$4.1~~$0.2 million and ~~$1.7~~$0.9 million, respectively. The fair value of these contracts is sensitive to changes in foreign currency exchange rates.

~~Coach believes that exposure~~ A sensitivity analysis of the effects of foreign exchange rate fluctuations on the fair values of our derivative contracts was performed to ~~adverse changes in~~assess the risk of loss. As of June 27, 2015, a 10% devaluation of the U.S. Dollar against the exchange rates ~~associated with revenues and expenses of~~for foreign ~~operations, which are denominated~~currencies under contract would result in Japanese yen, Chinese renminbi, Hong Kong dollar, Macanese pataca, Canadian dollar, Singapore dollar, Taiwan dollar, Malaysian ringgit, Korean won and the euro, are not material to the Company’s consolidated financial statements.

The Company is exposed to interest rate risk in relation to its ~~investments, revolving credit facilities~~Amended and ~~long-term debt.~~

Restated Credit Agreement, including the Term Loan, the 4.250% Senior Notes and investments.

The Company’s investment portfolio is maintained in accordance with the Company’s investment policy, which ~~identifies allowable investments, specifies~~defines our investment principles including credit quality standards and limits the credit exposure of any single issuer. The primary objective

Based on the evaluation of the Company’s disclosure controls and procedures, as that term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended, ~~each of Lew Frankfort,~~ the Chief Executive Officer of the Company and ~~Jane Nielsen,~~ the Chief Financial Officer of the Company, ~~has~~have concluded that the Company’s disclosure controls and procedures are effective as of June ~~30, 2012.~~

The Company’s management is responsible for establishing and maintaining adequate internal controls over financial reporting. The Company’s internal control system was designed to provide reasonable assurance to the Company’s management and Board regarding the preparation and fair presentation of published financial statements. Management evaluated the effectiveness of the Company’s internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission in Internal Control — Integrated ~~Framework.~~Framework in 2013. Management, under the supervision and with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of the Company’s internal control over financial reporting as of June ~~30, 2012~~27, 2015 and concluded that it is effective.

There were no changes in internal control over financial reporting that occurred during the fourth fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

The information required to be included by Item 10 of Form 10-K will be included in the Proxy Statement for the ~~2012~~2015 Annual Meeting of Stockholders and such information is incorporated by reference herein. The Proxy Statement will be filed with the Commission within 120 days after the end of the fiscal year covered by this Form 10-K pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended.

The information regarding executive and director compensation set forth in the Proxy Statement for the ~~2012~~2015 Annual Meeting of Stockholders is incorporated herein by reference. The Proxy Statement will be filed with the Commission within 120 days after the end of the fiscal year covered by this Form 10-K pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended.

The information under the headings “Securities Authorized for Issuance Under Equity Compensation Plans” and “Coach Stock Ownership by Certain Beneficial Owners and Management” in the Company’s Proxy Statement for the ~~2012~~2015 Annual Meeting of Stockholders is incorporated herein by reference.

There are no arrangements known to the registrant that may at a subsequent date result in a change in control of the registrant.

The Proxy Statement will be filed with the Commission within 120 days after the end of the fiscal year covered by this Form 10-K pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended.

The information required to be included by Item 13 of Form 10-K will be included in the Proxy Statement for the ~~2012~~2015 Annual Meeting of Stockholders and such information is incorporated by reference herein. The Proxy Statement will be filed with the Commission within 120 days after the end of the fiscal year covered by this Form 10-K pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended.

The information required by this item is incorporated herein by reference to the sections entitled “Fees For Audit and Other Services” and “Audit Committee Pre-Approval Policy” in the Proxy Statement for the ~~2012~~2015 Annual Meeting of Stockholders. The Proxy Statement will be filed with the Commission within 120 days after the end of the fiscal year covered by this Form 10-K pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended.

The Company maintains several share-based compensation plans which are more fully described below. The following table shows the total compensation cost charged against income for these plans and the related tax benefits recognized in the income ~~statement:~~

statement (in millions):

The Company maintains the Amended and Restated 2010 Stock Incentive Plan to award stock options and shares to certain members of ~~Coach~~ management and the outside members of its Board of Directors (“Board”). ~~Coach~~The Company maintains the 2000 Stock Incentive ~~Plan, the 2000 Non-Employee Director Stock~~ Plan and the 2004 Stock Incentive Plan for awards granted prior to the establishment of the 2010 Stock Incentive Plan. These plans were approved by ~~Coach’s~~the Company's stockholders. The exercise price of each stock option equals 100% of the market price of ~~Coach’s~~the Company's stock on the date of grant and generally has a maximum term of 10 years. Stock options and service based share awards that are granted as part of the annual compensation process generally vest ratably over three years. Other stock option and share awards ~~granted primarily for retention purposes,~~ are subject to forfeiture until completion of the vesting period, which ranges from one to five years. The Company issues new shares upon the exercise of stock options or vesting of share ~~units and employee stock purchases.~~

~~For options granted under Coach’s~~units.

A summary of stock option ~~plans prior to July 1, 2003, an active employee can receive a replacement stock option equal to~~activity during the ~~number of shares surrendered upon a stock-for-stock exercise. The exercise price of the replacement option equals 100% of the market value at the date of exercise of the~~

The fair value of each ~~Coach~~ option grant is estimated on the date of grant using the Black-Scholes option pricing model and the following weighted-average assumptions:

The expected term of options represents the period of time that the options granted are expected to be outstanding and is based on historical experience. Expected volatility is based on historical volatility of the Company’s stock as well as the implied volatility from publicly traded options on ~~Coach’s~~the Company's stock. The risk free interest rate is based on the zero-coupon U.S. Treasury issue as of the date of the grant. ~~Grants subsequent to~~Dividend yield is based on the current expected annual dividend per share and the Company’s ~~April 2009 Board approval to initiate a quarterly dividend included a dividend yield assumption based on Coach’s annual expected dividend divided by the grant-date share~~stock price.

The weighted-average grant-date fair value of options granted during fiscal ~~2012,~~2015, fiscal ~~2011~~2014 and fiscal ~~2010~~2013 was ~~$15.59, $11.41,~~$6.41, $9.79, and ~~$9.68,~~$13.02, respectively. The total intrinsic value of options exercised during fiscal ~~2012,~~2015, fiscal ~~2011~~2014 and fiscal ~~2010~~2013 was ~~$197,793, $226,511,~~$12.1 million, $28.0 million, and ~~$127,879,~~$77.0 million, respectively. The total cash received from option exercises was ~~$178,292, $357,344,~~$32.4 million, $44.5 million, and ~~$208,919~~$74.3 million in fiscal ~~2012,~~2015, fiscal ~~2011~~2014 and fiscal ~~2010,~~2013, respectively, and the ~~actual~~cash tax benefit realized for the tax deductions from these option exercises was ~~$73,982, $84,993,~~$4.7 million, $10.4 million, and ~~$47,795,~~$29.2 million, respectively.

At June ~~30, 2012, $38,783~~27, 2015, $23.4 million of total unrecognized compensation cost related to non-vested stock option awards is expected to be recognized over a weighted-average period of 1.0 ~~years.~~

year.

At June ~~30, 2012, $98,571~~27, 2015, $66.8 million of total unrecognized compensation cost related to non-vested share awards is expected to be recognized over a weighted-average period of 1.0 year.

The weighted-average grant-date fair value of share awards granted during fiscal 2015, fiscal 2014 and fiscal 2013 was $36.38, $52.93 and $54.49, respectively. The total fair value of shares vested during fiscal 2015, fiscal 2014 and fiscal 2013 was $48.4 million, $78.7 million and $93.3 million, respectively.

The Company grants performance-based share awards to key executives, the vesting of which is subject to the executive’s continuing employment and the Company's achievement of certain performance goals. A summary of performance-based share award activity during the year ended June 27, 2015 is as follows (in millions, except per share data):

⁽¹⁾ During fiscal 2015, there was less than 0.1 million shares of PRSU activity due to changes in performance conditions.

At June 27, 2015, $16.2 million of total unrecognized compensation cost related to non-vested share awards is expected to be recognized over a weighted-average period of 1.1 years.

The weighted-average grant-date fair value of share awards granted during fiscal 2015, fiscal 2014 and fiscal 2013 was $36.43, $32.53 and $50.55, respectively. The total fair value of awards that vested during fiscal 2015 and fiscal 2014 was $2.5 million and $23.8 million, respectively. There were no vestings of performance-based shares during fiscal 2013.

During fiscal 2015, the Company granted 0.4 million shares of common stock with a fair value of $12.6 million to selected senior executives. The shares of common stock under these PRSU awards will be earned and distributed based on certain Company-specific productivity, strategic and sales metrics. Further, the shares are subject to a three-year cliff vesting, subject to the employee's continuing employment and the Company's achievement of the aforementioned performance goals established at the beginning of the performance period. The fair value of the PRSU's is based on the fair value of the Company's common stock on the date of grant.

During fiscal 2014, the Company granted 0.2 million shares of common stock with a fair value of $6.8 million to selected executives as retention PRSU awards with a maximum potential number of shares issued and fair value (excluding dividends) of 0.3 million shares and $9.1 million, respectively. The shares of common stock under these PRSU awards will be earned and distributed based on performance criteria which compares the Company’s total stockholder return over the performance period to the total stockholder return of the companies included in the Standard & Poor’s 500 Index on the date of grant (excluding the Company). The grant date fair value of the PRSU awards was determined utilizing a Monte Carlo simulation and the following assumptions: expected volatility of 32.61%, risk-free interest rate of 0.63%, and dividend yield of 0.00%. Included in the non-vested amount at June 27, 2015 are approximately 0.8 million of PRSU awards that are based on the aforementioned performance criteria.

In fiscal 2015, fiscal 2014 and fiscal 2013, the cash tax benefit realized for the tax deductions from all RSUs (service and performance-based) was $15.7 million, $33.5 million and $26.1 million, respectively.

Under the 2001 Employee Stock Purchase Plan, full-time ~~Coach~~ employees are permitted to purchase a limited number of ~~Coach~~Company common shares at 85% of market value. Under this plan, ~~Coach~~the Company sold ~~129, 120,~~0.1 million, 0.1 million, and ~~176 new~~0.1 million shares to employees in fiscal ~~2012,~~2015, fiscal ~~2011~~2014 and fiscal ~~2010,~~2013, respectively. Compensation expense is calculated for the fair value of employees’ purchase rights using the Black-Scholes model and the following weighted-average assumptions:

The weighted-average fair value of the purchase rights granted during fiscal ~~2012,~~2015, fiscal ~~2011~~2014 and fiscal ~~2010~~2013 was ~~$17.31, $11.51,~~$8.41, $13.30, and ~~$9.15,~~$15.08, respectively.

~~Under~~ The Company issues new shares for employee stock purchases.

The amortized cost, gross unrealized gains, gross unrealized losses and fair value of available-for-sale securities are presented below (in millions):

On May 4, 2015, the Company acquired all of the outstanding equity interests of Stuart Weitzman Topco LLC (“Topco”) and Stuart Weitzman Intermediate LLC (“Stuart Weitzman”), a wholly owned subsidiary of Topco, which ~~represent~~ the ~~right to receive shares~~Company believes will complement its current leadership position in premium handbags and accessories. Stuart Weitzman designs and manufactures women’s luxury footwear and accessories. The results of ~~Coach common stock on~~ the ~~distribution date elected by~~Stuart Weitzman’s operations (including approximately $43 million of net sales and an operating loss of $4 million, including the ~~participant, or placed in an interest-bearing account to be paid on such distribution date. The amounts accrued under these plans at June 30, 2012~~effects of purchase accounting and ~~July 2, 2011 were $2,664 and $2,688, respectively, and are~~contingent payments) have been included ~~within total liabilities~~ in the consolidated financial statements since the date of acquisition within the Other segment.

The aggregate cash paid in connection with the acquisition of Stuart Weitzman was $531.1 million (or $519.6 million net of cash acquired). Furthermore, the acquisition agreement contains a potential earnout payment of up to $14.7 million annually in cash over the next three calendar years, based on the achievement of certain revenue targets. The agreement also contains a catch-up provision that provides that if the revenue targets are missed in any one year but are surpassed in succeeding years then amounts for past years become due upon surpassing targets in succeeding years. The total amount payable under the earnout will not exceed $44.0 million.

The Company funded the acquisition through cash on-hand, including the utilization of a portion of debt related proceeds, as described in Note 11, “Debt.”

The purchase price allocations for these assets and liabilities are substantially complete, however it may be subject to change as additional information is obtained during the acquisition measurement period. The following table summarizes the fair value of the assets acquired and liabilities assumed as of the acquisition date (in millions):

On July 1, 2013, the Company became the 100% owner of its European joint venture by purchasing Hackett Limited’s remaining 50% interest in the joint venture, enabling the Company to assume direct control and consolidate its European retail business. The joint venture included 18 retail locations in Spain, Portugal, Great Britain, France, Ireland and Germany. The results of the acquired business have been included in the consolidated financial statements since the date of acquisition within the International segment. The purchase price consisted of cash payments of approximately $15.1 million and the forgiveness of a loan from the Company to Hackett Limited of approximately $18.0 million. The allocation of the purchase price acquisition has been completed resulting in goodwill of $14.8 million which is not tax deductible.

On July 1, 2012, the Company acquired 100% of its domestic retail business in Malaysia (consisting of 10 retail stores) from the former distributor, Valiram Group, and on August 5, 2012, acquired 100% of its domestic retail business in South Korea (consisting of 47 retail and department store locations) from the former distributor, Shinsegae International. The results of the acquired businesses have been included in the consolidated financial statements since the dates of acquisition within the International segment. The aggregate cash paid in connection with the acquisitions of the Malaysia and South Korea businesses was $8.6 million and $36.9 million, respectively. The Company made a contingent payment to Shinsegae International, of $6.0 million in fiscal 2014 and $3.8 million in fiscal 2015 (classified as financing activities within the Consolidated Statements of Cash Flows).

The following table summarizes the fair values of the assets acquired as part of the fiscal 2013 acquisitions (in millions):

Unaudited pro forma information related to the fiscal 2015, 2014 and 2013 acquisitions are not included, as the impacts of these transactions are not material to the consolidated results of the Company.

The Company leases ~~certain~~ office, distribution and retail facilities. The lease agreements, which expire at various dates through ~~2028,~~2036, are subject, in ~~some~~most cases, to renewal options and provide for the payment of taxes, insurance and maintenance. Certain leases contain escalation clauses resulting from the pass-through of

During fiscal 2015, fiscal 2014 and fiscal 2013 there were no material gains or losses recognized in income due to hedge ineffectiveness.

For forward foreign currency exchange contracts that are designated as fair value hedges, the gain (loss) on the derivative as well as the offsetting (loss) gain on the hedged item attributable to the hedged risk, both of ~~five~~which are recorded within SG&A, resulted in an immaterial net impact to ~~ten years~~the Company's statement of operations.

The Company expects that $4.4 million of net derivative gains included in AOCI at ~~their fair rental value at~~June 27, 2015 will be reclassified into earnings within the ~~time of renewal. In the normal course of business, operating leases are generally renewed or replaced by new leases.~~

The Company ~~categorized~~categorizes its assets and liabilities based on the priority of the inputs to the valuation technique into a three-level fair value hierarchy as set forth below. The three levels of the hierarchy are defined as follows:

Level 1 — Unadjusted quoted prices in active markets for identical assets or liabilities. ~~Coach currently does not have any Level 1 financial assets or liabilities.~~

Level 2 — Observable inputs other than quoted prices included in Level 1. Level 2 inputs include quoted prices for identical assets or liabilities in non-active markets, quoted prices for similar assets or liabilities in active markets, and inputs other than quoted prices that are observable for substantially the full term of the asset or liability.

Level 3 — Unobservable inputs reflecting management’s own assumptions about the input used in pricing the asset or liability.

The following table shows the fair value measurements of the Company’s financial assets and liabilities at June ~~30, 2012~~27, 2015 and ~~July 2, 2011:~~

June 28, 2014 (in millions):

The Company’s non-financial instruments, which primarily consist of goodwill, intangible assets and property and equipment, are not required to be measured at fair value on a recurring basis and are reported at carrying value. However, on a periodic basis whenever events or changes in ~~thousands, except per share data)~~

Ascircumstances indicate that their carrying value may not be fully recoverable (and at least annually for goodwill and indefinite-lived intangible assets), non-financial instruments are assessed for impairment and, if applicable, written-down to and recorded at fair value, considering market participant assumptions. Refer to Note 7, "Acquisitions," for further discussion of ~~July 2, 2011,~~ the approaches used in valuing acquired assets and assumed liabilities.

The Company incurred impairment charges of $0.0 million in fiscal 2015, $35.5 million in fiscal 2014 and $16.6 million in fiscal 2013, to reduce the carrying amount of certain store assets (primarily leasehold improvements at selected retail store locations) to their fair values of $6.9 million as of June 28, 2014 and $4.3 million as of June 29, 2013. The fair values of these assets were determined based on Level 3 measurements. Inputs to these fair value measurements included estimates of the amount and the timing of the stores' net future discounted cash flows based on historical experience, current trends, and market conditions.

As of June ~~30, 2012~~27, 2015, the Company's equity method investment related to an equity interest in an entity formed during fiscal 2013 for the purpose of developing a new office tower in Manhattan, the Hudson Yards joint venture, with the Company owning less than 43% of the joint venture. This investment is included in the Company’s long-term investments.

The formation of the Hudson Yards joint venture serves as a financing vehicle for the project. Construction of the new building has commenced and ~~July 2, 2011,~~upon completion of the ~~remaining balance on~~office tower in fiscal 2016, the ~~loan was $1,440 and $1,860, respectively.~~Company will retain a condominium interest serving as its new corporate headquarters. During fiscal ~~2009, Coach assumed~~2015, the Company invested $139.1 million in the joint venture. Since the formation of the Hudson Yards joint venture, the Company has invested $320.2 million. The Company expects to invest approximately $210 million over the next two years, with approximately $195 million estimated in fiscal 2016, depending on construction progress. Outside of the joint venture, the Company is directly investing in a ~~mortgage~~portion of the design and build-out of the new corporate headquarters. In fiscal 2015, $5.9 million was included in ~~connection with~~capital expenditures and we expect approximately another $185 million over the ~~purchase~~period of construction.

The Hudson Yards joint venture is determined to be a VIE primarily due to the fact that it has insufficient equity to finance its ~~corporate headquarters building in New York City. This mortgage bears interest at 4.68%. Interest payments are made monthly and principal payments began in July 2009, with~~activities without additional subordinated financial support from its two joint venture partners. The Company is not considered the ~~final payment~~primary beneficiary of ~~$21,555 due in June 2013. As of June 30, 2012,~~ the ~~remaining balance on~~entity primarily because the ~~mortgage was $21,920. Future principal payments under these obligations are as follows:~~

Company does not have the power to direct the activities that most significantly impact the entity’s economic performance. The Company’s maximum loss exposure is limited to the committed capital.

Fiscal Year Amount
2013 $ 22,375
2014 500
2015 485
2016 —
2017 —
Subsequent to 2017 —
Total $ 23,360

In the ordinary course of business, ~~Coach~~the Company is a party to several pending legal proceedings and claims. Although the outcome of such items cannot be determined with certainty, ~~Coach's~~the Company's general counsel and management are of the opinion that the final outcome will not have a material effect on ~~Coach's~~the Company's cash flow, results of operations or financial position.

Based on the ~~Company entered into forward exchange and cross-currency swap contracts, the terms of which include the exchange of foreign currency fixed interest for U.S. dollar fixed interest and an exchange~~balance of the ~~foreign currency and U.S. dollar based notional values at the maturity dates, the latest of which is June 2013.~~

The Company’s derivative instruments are primarily designated as cash flow hedges. The effective portion of gains or losses on the derivative instruments are reported as a component of other comprehensive income and reclassified into earnings in the same periods during which the hedged transaction affects earnings. The ineffective portion of gains or losses on the derivative instruments are recognized in current earnings and are included within net cash provided by operating activities.

~~The following tables provide information related to the Company’s derivatives:~~

Derivatives Designated as Hedging Instruments Balance Sheet Classification Fair Value
At June 30,
2012 At July 2,
2011
Foreign exchange contracts
Other Current Assets $ 1,459 $ 2,020
Total derivative assets $ 1,459 $ 2,020
Foreign exchange contracts
Accrued Liabilities $ 4,098 $ 1,713
Total derivative liabilities $ 4,098 $ 1,713

Amount of Loss Recognized in OCI on Derivatives (Effective Portion)
Year Ended
Derivatives in Cash Flow Hedging Relationships June 30,
2012 July 2,
2011
Foreign exchange contracts $ (2,095 ) $ (9,394 )
Total $ (2,095 ) $ (9,394 )

~~For fiscal 2012 and fiscal 2011, the amounts above are net of tax of $1,858 and $5,960, respectively.~~

Amount of Loss Reclassified from Accumulated OCI into Income (Effective Portion)
Year Ended
Location of Loss Reclassified from Accumulated OCI
into Income (Effective Portion) June 30,
2012 July 2,
2011
Cost of Sales $ (5,281 ) $ (15,886 )
Total $ (5,281 ) $ (15,886 )

~~During fiscal 2012 and fiscal 2011, there were no material gains or losses recognized in income due to hedge ineffectiveness.~~

The Company expects that $994 of net derivative losses included in accumulated other comprehensive income at June 30, 2012 will be reclassified into earnings within the next 12 months. This amount will vary due to fluctuations in the Japanese yen and Canadian dollar exchange rates.

~~Hedging activity affected accumulated other comprehensive income, net of tax, as follows:~~

Year Ended
June 30,
2012 July 2,
2011
Balance at beginning of period $ (1,465 ) $ (2,092 )
Net losses transferred to earnings 3,100 10,021
Change in fair value, net of tax (2,095 ) (9,394 )
Balance at end of period $ (460 ) $ (1,465 )

The expected future amortization expense above reflects remaining useful lives of ~~trademarks.~~

The provisions for income taxes computed by applying the U.S. statutory rate to income before taxes as reconciled to the actual provisions ~~were:~~

were (in millions):

Current and deferred tax ~~provisions (benefits) were:~~

provision (benefit) was (in millions):

The components of deferred tax assets and liabilities ~~at the respective year-ends~~ were ~~as follows:~~

(in millions):

Significant judgment is required in determining the worldwide provision for income taxes, and there are many transactions for which the ultimate tax outcome is uncertain. It is the Company’s policy to establish provisions for taxes that may become payable in future years, ~~as a result of~~including those due to an examination by tax authorities. The Company establishes the provisions based upon management’s assessment of exposure associated with uncertain tax positions. The provisions are analyzed ~~periodically~~at least quarterly and ~~adjustments are made~~adjusted as ~~events occur that warrant adjustments to those provisions. All of these determinations are subject to~~appropriate based on new information or circumstances in accordance with the requirements of ASC 740.

Of the ~~$155,599~~$168.1 million ending gross unrecognized tax benefit balance ~~$77,366~~as of June 27, 2015, $121.5 million relates to items which, if recognized, would impact the effective tax rate. Of the $170.7 million ending gross unrecognized tax benefit balance as of June 28, 2014, $113.0 million relates to items which, if recognized, would impact the effective tax rate. As of June ~~30, 2012~~27, 2015 and ~~July 2, 2011,~~June 28, 2014, gross interest and penalties payable was ~~$24,338~~$17.6 million and ~~$35,258,~~$18.0 million, respectively, which are included in ~~other~~Other liabilities. During fiscal ~~2012,~~2015, fiscal ~~2011~~2014 and fiscal ~~2010,~~2013, the Company recognized gross interest and penalty ~~(income)~~income of $0.1 million, gross interest and penalty expense of ~~$(11,334), $(3,195),~~$0.8 million and ~~$6,204, respectively, in the Consolidated Statements~~gross interest and penalty income of ~~Income.~~

$7.0 million, respectively.

The Company files income tax returns in the U.S. federal jurisdiction, as well as various state and foreign jurisdictions. Tax examinations are currently in progress in select foreign and state jurisdictions that are extending the years open under the statutes of limitation. Fiscal years ~~2009~~2011 to present are open to examination in the U.S. federal jurisdiction, fiscal 2008 to present in select state jurisdictions and fiscal 2004 to present in ~~significant state jurisdictions and from fiscal 2004 to present in~~select foreign jurisdictions. ~~During fiscal 2012 and fiscal 2011, the Company recorded tax benefits related to multi-year agreements with tax authorities.~~

~~Based on the number of tax years currently under audit by the relevant tax authorities, the~~The Company anticipates that one or more of these audits may be finalized and certain statutes of limitation may expire in the foreseeable future. However, based on the status of these examinations, and the ~~protocol of~~average time typically incurred in finalizing audits bywith the relevant tax authorities, we cannot reasonably estimate the impact ~~of any amount of such changes~~these audits may have in the next 12 months, if any, to previously recorded uncertain tax positions.

At We accrue for certain known and reasonably anticipated income tax obligations after assessing the likely outcome based on the weight of available evidence. Although we believe that the estimates and assumptions we have used are reasonable and legally supportable, the final determination of tax audits could be different than that which is reflected in historical income tax provisions and recorded assets and liabilities. With respect to all jurisdictions, we believe we have made adequate provision for all income tax uncertainties.

For the years ended June ~~30, 2012,~~27, 2015 and June 28, 2014, the Company had net operating loss carryforwards in foreign tax jurisdictions of ~~$88,967,~~$618.3 million and $526.7 million, the majority of which ~~will expire beginning in fiscal years 2013 through fiscal year 2017.~~can be carried forward indefinitely. The deferred tax assets related to the carryforwards have been reflected net of ~~a $3,156~~$169.8 million and $131.8 million valuation ~~allowance.~~

allowances at June 27, 2015 and June 28, 2014, respectively. The Company’s valuation allowance increased by $38.0 million in fiscal 2015 and increased by $52.2 million in fiscal 2014, primarily as the result of actual or anticipated results in the foreign jurisdictions.

The total amount of undistributed earnings of foreign subsidiaries as of June ~~30, 2012~~27, 2015 and June 28, 2014, was ~~$1,203,949.~~$2.09 billion and $2.03 billion, respectively. It is the Company’s intention to permanently reinvest undistributed earnings of its foreign subsidiaries and thereby indefinitely postpone their remittance. Accordingly, no provision has been made for foreign withholding taxes or United States income taxes which may become payable if undistributed earnings of foreign subsidiaries are paid as dividends. Determination of the amount of unrecognized deferred income tax liabilities on these earnings is not practicable because such liability, if any, is subject to many variables and is dependent on circumstances existing if and when remittance occurs.

The Company maintains the Coach, Inc. Savings and Profit Sharing Plan, which is a defined contribution plan. Employees who meet certain eligibility requirements and are not part of a collective bargaining agreement may participate in this program. The annual expense incurred by ~~Coach~~the Company for this defined contribution plan was ~~$18,641, $16,029,~~$7.2 million, $7.5 million, and ~~$13,285~~$16.3 million in fiscal ~~2012,~~2015, fiscal ~~2011~~2014 and fiscal ~~2010,~~2013, respectively.

The Company operates its business in two reportable segments: Direct-to-Consumer and Indirect. The Company's reportable segments represent channels of distribution that offer similar merchandise, service and marketing strategies. Sales of Coach products through Company-operated stores in North America; Japan;

In fiscal 2015, the Company has three reportable segments based on its business activities and ~~shares~~organization:

In deciding how to allocate resources and assess performance, ~~Coach's~~the Company's chief operating decision maker regularly evaluates the sales and operating income of these segments. Operating income is the gross margin of the segment less direct expenses of the segment. Unallocated corporate expenses include inventory-related costs (such as production ~~variances, general~~variances), advertising, marketing, design, administration and information systems, as well as distribution and consumer service expenses.

~~In connection with the acquisitions of the retail businesses in Hong Kong, Macau, mainland China, Singapore and Taiwan,~~ Additionally, costs incurred by the Company ~~evaluated the composition of its reportable segments~~as described in Note 3, "Transformation and ~~concluded that sales in these regions should be~~Other Actions," and certain acquisition-related costs are also included ~~in the Direct-to-Consumer segment. Accordingly, prior year net sales, operating income~~as unallocated corporate expenses. The following table summarizes segment performance for fiscal 2015, fiscal 2014 and ~~profit before tax figures have been reclassified to conform to the current year presentation.~~

fiscal 2013 (in millions):

Coach's product offerings include modern luxury accessories and lifestyle collections, including women's and men's bags, small leather goods, footwear, business cases, wearables including outerwear, watches, weekend and travel accessories, scarves, sunwear, fragrance, jewelry, travel bags and other lifestyle products. During fiscal 2015, the Company reevaluated its product categories and determined that small accessory handbags and travel bags, which were previously classified as "Women's Accessories" and "All Other Products," respectively, are viewed by management to be part of its "Women's Handbag" product category. Prior periods have been adjusted to reflect the current period classification. The following table shows net sales for each product category represented (in millions):

As of June ~~30, 2012, Coach~~27, 2015, the Company operated ~~329~~277 retail stores and ~~163 factory~~195 outlet stores in the United States, 2526 retail stores and ~~six factory~~ten outlet stores in ~~Canada, 180~~Canada. Outside of North America, the Company operated 196 concession shop-in-shops within department ~~store shop-in-shops,~~stores, retail stores and ~~factory~~outlet stores in Japan, 171 in Greater China, and ~~130 department store shop-in-shops, retail stores and factory stores~~144 in ~~Hong Kong, Macau, mainland China, Taiwan and Singapore. Coach~~other international locations. The Company also operates distribution, product development and quality control locations in the United States, Hong Kong, China, South Korea, Vietnam, Philippines, India and ~~India.~~Spain. Geographic revenue information is based on the location of our ~~customer.~~customer sale. Geographic long-lived asset information is based on the physical location of the assets at the end of each ~~period~~fiscal year and includes property and equipment, net and other assets.

Basic net income per share ~~data)~~

is calculated by dividing net income by the weighted-average number of shares outstanding during the period. Diluted net income per share is calculated similarly but includes potential dilution from the exercise of stock options and RSUs and any other potentially dilutive instruments, only in the periods in which such effects are dilutive under the treasury stock method.

The following is a reconciliation of the weighted-average shares outstanding and calculation of basic and diluted earnings per ~~share:~~

share (in millions, except per share data):

At June ~~30, 2012,~~27, 2015, options to purchase ~~116~~5.9 million shares of common stock were outstanding but not included in the computation of diluted earnings per share, as these options’ exercise prices, ranging from ~~$72.06~~$38.75 to $78.46, were greater than the average market price of the common shares.

At ~~July 2, 2011,~~June 28, 2014, options to purchase 556.4 million shares of common stock were outstanding but not included in the computation of diluted earnings per share, as these options’ exercise prices, ranging from ~~$59.97~~$43.39 to ~~$60.28,~~$78.46, were greater than the average market price of the common shares.

At ~~July 3, 2010,~~June 29, 2013, options to purchase ~~3,710~~2.1 million shares of common stock were outstanding but not included in the computation of diluted earnings per share, as these options’ exercise prices, ranging from ~~$41.93~~$56.95 to ~~$51.56,~~$78.46, were greater than the average market price of the common shares.

Earnings per share amounts have been calculated based on unrounded numbers. Options to purchase shares of the Company's common stock at an exercise price greater than the average market price of the common stock during the reporting period are anti-dilutive and therefore not included in the computation of diluted net income per common share. In addition, the Company has outstanding RSUs that are issuable only upon the achievement of certain performance goals. PRSUs are included in the computation of diluted shares only to the extent that the underlying performance conditions (and any applicable market condition modifiers) (i) are satisfied as of the end of the reporting period or (ii) would be considered satisfied if the end of the reporting period were the end of the related contingency period and the result would be dilutive under the treasury stock method. As of June 27, 2015, June 28, 2014 and June 29, 2013, there were approximately 6.8 million, 7.1 million, and 2.8 million, respectively, of additional shares issuable upon exercise of anti-dilutive options and contingent vesting of PRSUs, which were excluded from the diluted share calculations.

Purchases of ~~Coach’s~~the Company's common stock ~~are~~have been made from time to time, subject to market conditions and at prevailing market prices, through open market purchases. ~~Repurchased~~Under Maryland law, Coach’s state of incorporation, treasury shares ~~of common stock become authorized but unissued~~are not allowed. As a result, all repurchased shares ~~and may be issued in the future for general corporate and other purposes.~~are retired when acquired. The ~~Company may terminate or limit the~~Company's stock repurchase program expired at ~~any time.~~

the end of fiscal 2015, with zero remaining availability at June 27, 2015.

During fiscal ~~2012,~~2015, fiscal ~~2011~~2014, and fiscal ~~2010,~~2013, the Company repurchased and retired ~~10,688, 20,404~~zero, 10.2 million and ~~30,686~~7.1 million shares, respectively, or ~~$700,000, $1,098,000~~$0.0 million, $524.9 million, and ~~$1,150,000~~$400.0 million of common stock, respectively, at an average cost of ~~$65.49, $53.81~~$0.00, $51.27 and ~~$37.48~~$56.61 per share, respectively. ~~As of June 30, 2012, Coach had $261,627 remaining in the stock repurchase program.~~



Maryland		52-2242751
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)



Title of Each Class:		Name of Each Exchange on which Registered
Common Stock, par value $.01 per share		New York Stock Exchange



Documents		Form 10-K Reference
Proxy Statement for the ~~2012~~2015 Annual Meeting of Stockholders		Part III, Items 10 -– 14




		Page Number
	PART I
Item 1.	Business	2
Item 1A.	Risk Factors	11
Item 1B.	Unresolved Staff Comments	20
Item 2.	Properties	21
Item 3.	Legal Proceedings	21
Item 4.	Mine Safety Disclosures	22
		2PART II
~~Item 1A.~~ ~~Risk Factors~~			12
~~Item 1B.~~ ~~Unresolved Staff Comments~~			18
~~Item 2.~~ ~~Properties~~			19
~~Item 3.~~ ~~Legal Proceedings~~			19
~~Item 4.~~ ~~Mine Safety Disclosures~~			20
~~PART II~~
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities			2123
Item 6.	Selected Financial Data			2426
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations			2729
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk			4148
Item 8.	Financial Statements and Supplementary Data			4349
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	49
Item 9A.	Controls and Procedures	49
Item 9B.	Other Information	49
		43PART III
~~Item 9A.~~ ~~Controls and Procedures~~			43
~~Item 9B.~~ ~~Other Information~~			43
~~PART III~~
Item 10.	Directors, Executive Officers and Corporate Governance			4450
Item 11.	Executive Compensation			4450
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters			4450
Item 13.	Certain Relationships and Related Transactions, and Director Independence	50
Item 14.	Principal Accounting Fees and Services	50
		44PART IV
~~Item 14.~~ ~~Principal Accountant Fees and Services~~			44
~~PART IV~~
Item 15.	Exhibits, Financial Statement Schedules			4551
Signatures				4652



þ
x		ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


n	Fiscal 2009: Hong Kong, Macau and mainland China (“Greater China”).



	Fiscal Year Ended
	June 27, 2015		June 28, 2014		June 29, 2013
Retail stores	258		332		351
Net decrease vs. prior year	(74	)	(19	)	(3	)
% decrease vs. prior year	(22.3	)%	(5.4	)%	(0.8	)%
Retail square footage	728,833		910,003		952,422
Net decrease vs. prior year	(181,170	)	(42,419	)	(6,677	)
% decrease vs. prior year	(19.9	)%	(4.5	)%	(0.7	)%
Average square footage	2,825		2,741		2,713



		Date
Category	Partner	Introduction	Expiration
Footwear	Jimlar Corporation	1999	2017
Eyewear	Luxottica⁽¹⁾	2012	2016
Watches	Movado	1998	2020
Fragrance	Estee Lauder⁽²⁾	2010	2015
Fragrance	Interparfums⁽²⁾	2015	2026


⁽¹⁾	The Luxottica licensing relationship is expected to automatically renew in June 2016 with a new expiration date in calendar year 2020.


⁽²⁾	The Estee Lauder licensing relationship expired on June 30, 2015. Coach entered into a new licensing agreement with Interparfums in April 2015, expiring in June 2026.


	Fiscal Year Ended
	June 30, 2012			July 2, 2011			July 3, 2010
Men’s & Women’s Handbags		65	%		66	%		65	%
Accessories		28			27			26
All other products		7			7			9
Total		100	%		100	%		100	%


~~Category~~	~~Licensing~~ ~~Partner~~	~~Introduction~~ ~~Date~~	~~Territory~~	~~License~~ ~~Expiration~~ ~~Date~~
~~Footwear~~	~~Jimlar~~	~~Spring '99~~	~~U.S.~~	~~2014~~
~~Eyewear~~	~~Luxottica~~	~~Spring '12~~	~~Worldwide~~	~~2016~~
~~Watches~~	~~Movado~~	~~Spring '98~~	~~Worldwide~~	~~2015~~
~~Fragrance~~	~~Estee Lauder~~	~~Spring '10~~	~~Worldwide~~	~~2015~~



Location	Use		Approximate Square Footage
Jacksonville, Florida		~~Distribution~~North America distribution and consumer service				850,000
New York, New York		Corporate, design, sourcing and product development				~~433,000~~	429,000⁽¹⁾
Carlstadt, New Jersey	Corporate offices	~~Corporate~~	65,000
New York, New York	Stuart Weitzman corporate, design, sourcing and product development		37,500		~~65,000~~
Tokyo, Japan		Coach Japan regional management		32,300		~~32,000~~
~~Dongguan, China~~		~~Sourcing, quality control and product development~~				~~27,000~~
Shanghai, China		~~Coach~~Greater China regional management		23,000		~~22,000~~
Hong Kong		~~Sourcing and quality control~~				~~17,000~~
~~Hong Kong~~		Coach Hong Kong regional management		18,100
South Korea	~~14,000~~Coach South Korea regional management		18,000
Shanghai, China	Coach Asia shared service center		17,700
Hong Kong	Corporate sourcing and quality control		17,000⁽²⁾
Dongguan, China	Corporate sourcing, quality control and product development		16,700
Ho Chi Minh City, Vietnam		~~Sourcing~~Corporate sourcing and quality control		10,200
Fort Lauderdale, Florida	~~11,000~~Stuart Weitzman corporate management		9,400
London	Coach Europe regional management		8,000
Taipei City, Taiwan		Coach Taiwan regional management		6,400
Malaysia	~~6,000~~
~~Hong Kong~~Coach Malaysia regional management	3,800	~~Sourcing and quality control~~				~~6,000~~
Singapore		Coach Singapore regional management		2,900		~~3,000~~
~~Seoul, South Korea~~		~~Sourcing~~				~~3,000~~
Beijing, China		~~Coach~~Greater China regional management		2,800
Clark, Philippines	~~3,000~~
~~Long An, Vietnam~~		~~Sourcing~~Corporate sourcing and quality control		2,400

~~1,000~~
~~Chennai, India~~	~~Sourcing and quality control~~	~~600~~
~~Luxembourg~~	~~Coach regional management~~	~~300~~


⁽²⁾	Represents a Coach-owned location.


	High				Low		Dividends Declared per Common Share
Fiscal 2012 Quarter ended:
October 1, 2011	$	69.20			$	45.70		0.225
December 31, 2011		66.54				48.37		0.225
March 31, 2012		79.70				59.74		0.225
June 30, 2012		79.00				55.18		0.300
Closing price at June 30, 2012			$	58.48
Fiscal 2011 Quarter ended:
October 2, 2010	$	43.86			$	33.75		0.150
January 1, 2011		58.55				42.27		0.150
April 2, 2011		58.28				49.24		0.150
July 2, 2011		66.14				50.34		0.225
Closing price at July 1, 2011			$	65.99



	High		Low		Closing		Dividends Declared per Common Share
Fiscal 2015 Quarter ended:
September 27, 2014	$	37.70	$	33.39			$	0.3375
December 27, 2014	37.60		32.72				0.3375
March 28, 2015	43.87		35.65				0.3375
June 27, 2015	43.45		34.00		$	36.12	0.3375

Fiscal 2014 Quarter ended:
September 28, 2013	$	59.58	$	51.53			$	0.3375
December 28, 2013	57.95		47.89				0.3375
March 29, 2014	56.72		44.31				0.3375
June 28, 2014	50.86		33.60		$	34.47	0.3375


⁽¹⁾	Includes ~~250,000~~approximately 285,000 square feet ~~in Coach owned~~related to Coach-owned buildings. ~~During fiscal 2009, Coach purchased its corporate headquarters building at 516 West 34~~^th ~~Street in New York City for $126.3 million.~~


	Jun-07		Jun-08		Jun-09		Jun-10		Jun-11		Jun-12
COH	$	100.00	$	60.94	$	56.88	$	78.16	$	138.48	$	128.60
Former Peer Set	$	100.00	$	62.51	$	36.82	$	62.47	$	94.44	$	88.03
Revised Peer Set	$	100.00	$	72.17	$	56.14	$	83.70	$	132.21	$	142.00
S&P 500	$	100.00	$	86.88	$	64.11	$	73.36	$	95.87	$	101.09



	June-10	June-11	June-12	June-13	June-14	June-15
COH	$100.00	$181.04	$168.14	$167.80	$103.33	$113.16
Peer Set	$100.00	$179.00	$205.09	$303.39	$374.33	$343.00
Former Peer Set	$100.00	$159.61	$171.34	$244.34	$276.27	$290.54
S&P 500	$100.00	$139.57	$144.67	$186.60	$240.78	$258.50


Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs⁽¹⁾		Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs⁽¹⁾
	(in thousands, except per share data)
Period 10 (4/1/12 – 5/5/12)		335	$	73.52		335	$	405,998
Period 11 (5/6/12 – 6/2/12)		1,478		69.07		1,478		303,905
Period 12 (6/3/12 – 6/30/12)		680		62.17		680		261,627
Total		2,493				2,493



	Fiscal Year Ended⁽¹⁾															Fiscal Year Ended⁽¹⁾
	June 30, 2012⁽²⁾			July 2, 2011⁽²⁾			July 3, 2010			June 27, 2009⁽²⁾			June 28, 2008⁽²⁾			June 27, 2015⁽²⁾⁽⁴⁾			June 28, 2014⁽³⁾⁽⁴⁾			June 29, 2013⁽³⁾⁽⁴⁾			June 30, 2012⁽³⁾⁽⁴⁾			July 2, 2011⁽⁴⁾
Consolidated Statements of Income:
Net sales	$	4,763,180		$	4,158,507		$	3,607,636		$	3,230,468		$	3,180,757		$	4,191.6		$	4,806.2		$	5,075.4		$	4,763.2		$	4,158.5
Gross profit		3,466,078			3,023,541			2,633,691			2,322,610			2,407,103		2,908.6			3,297.0			3,698.1			3,466.1			3,023.5
Selling, general and administrative expenses		1,954,089			1,718,617			1,483,520			1,350,697			1,259,974
Selling, general and administrative ("SG&A") expenses																2,290.6			2,176.9			2,173.6			1,954.1			1,718.6
Operating income		1,511,989			1,304,924			1,150,171			971,913			1,147,129		618.0			1,120.1			1,524.5			1,512.0			1,304.9
Income from continuing operations⁽³⁾		1,038,910			880,800			734,940			623,369			783,039
Income from continuing operations:
Net income																402.4			781.3			1,034.4			1,038.9			880.8
Net income:
Per basic share	$	3.60		$	2.99		$	2.36		$	1.93		$	2.20		$	1.46		$	2.81		$	3.66		$	3.60		$	2.99
Per diluted share		3.53			2.92			2.33			1.91			2.17		1.45			2.79			3.61			3.53			2.92
Weighted-average basic shares outstanding		288,284			294,877			311,413			323,714			355,731		275.7			277.8			282.5			288.3			294.9
Weighted-average diluted shares outstanding		294,129			301,558			315,848			325,620			360,332		277.2			280.4			286.3			294.1			301.6
Dividends declared per common share⁽⁴⁾	$	0.975		$	0.675		$	0.375		$	0.075		$	—
Dividends declared per common share																$	1.350		$	1.350		$	1.238		$	0.975		$	0.675

Consolidated Percentage of Net Sales Data:
Gross margin		72.8	%		72.7	%		73.0	%		71.9	%		75.7	%	69.4		%	68.6		%	72.9		%	72.8		%	72.7		%
Selling, general and administrative expenses		41.0	%		41.3	%		41.1	%		41.8	%		39.6	%
SG&A expenses																54.6		%	45.3		%	42.8		%	41.0		%	41.3		%
Operating margin		31.7	%		31.4	%		31.9	%		30.1	%		36.1	%	14.7		%	23.3		%	30.0		%	31.7		%	31.4		%
Income from continuing operations		21.8	%		21.2	%		20.4	%		19.3	%		24.6	%
Net income																9.6		%	16.3		%	20.4		%	21.8		%	21.2		%

Consolidated Balance Sheet Data:
Working capital	$	1,086,368		$	859,371		$	773,605		$	936,757		$	908,277		$	1,671.8		$	1,042.1		$	1,348.4		$	1,086.4		$	859.4
Total assets		3,104,321			2,635,116			2,467,115			2,564,336			2,247,353		4,666.9			3,663.1			3,531.9			3,104.3			2,635.1
Cash, cash equivalents and investments		923,215			712,754			702,398			806,362			706,905		1,931.8			1,353.1			1,332.2			923.2			712.8
Inventory		504,490			421,831			363,285			326,148			318,490		485.1			526.2			524.7			504.5			421.8
Long-term debt		985			23,360			24,159			25,072			2,580
Total debt																890.4			140.5			1.0			23.4			24.2
Stockholders' equity		1,992,931			1,612,569			1,505,293			1,696,042			1,490,375		2,489.9			2,420.6			2,409.2			1,992.9			1,612.6



	Fiscal Year Ended⁽¹⁾
	June 27, 2015⁽²⁾	June 28, 2014⁽³⁾	June 29, 2013⁽³⁾	June 30, 2012⁽³⁾	July 2, 2011
Coach Operated Store Data:
Stores open at fiscal year-end:
North American retail stores	258	332	351	354	345
North American outlet stores	204	207	193	169	143
Coach International	503	475	409	368	311
Stuart Weitzman stores	54	—	—	—	—
Total stores open at fiscal year-end	1,019	1,014	953	891	799

Store square footage at fiscal year-end:
North American retail stores	728,833	910,003	952,422	959,099	936,277
North American outlet stores	1,189,018	1,132,714	982,202	789,699	649,094
Coach International	1,030,695	918,995	768,567	665,396	544,798
Stuart Weitzman stores	91,101	—	—	—	—
Total store square footage at fiscal year-end	3,039,647	2,961,712	2,703,191	2,414,194	2,130,169

Average store square footage at fiscal year-end:
North American retail stores	2,825	2,741	2,713	2,709	2,714
North American outlet stores	5,829	5,472	5,089	4,673	4,539
Coach International	2,049	1,935	1,879	1,808	1,752
Stuart Weitzman stores	1,687	—	—	—	—


⁽¹⁾	~~Coach’s~~The Company’s fiscal year ends on the Saturday closest to June 30. Fiscal years 2015, 2014, 2013, 2012 ~~2011, 2009,~~ and ~~2008~~2011 were each 52-week years. ~~Fiscal year 2010 was a 53-week year.~~


⁽²⁾	~~During~~The Company acquired Stuart Weitzman in the fourth quarter of fiscal 2015.


⁽³⁾	The Company acquired its international businesses from its former distributors as follows: fiscal 2014 — the remaining 50% interest in Europe; fiscal 2013 — Malaysia and South Korea; fiscal 2012 — Singapore and Taiwan.


	Fiscal 2012
						Income from Continuing Operations
	SG&A			Operating Income		Amount		Per Diluted Share
As Reported: (GAAP Basis)	$	1,954,089		$	1,511,989	$	1,038,910	$	3.53
Excluding items affecting comparability		(39,209	)		39,209		0		0.00
Adjusted: (Non-GAAP Basis)	$	1,914,880		$	1,551,198	$	1,038,910	$	3.53

Large accelerated filer þ

Accelerated filer o

Non-accelerated filer o

~~Large Accelerated Filer~~
xSmaller reporting company

~~Accelerated Filer~~o

~~Non-Accelerated Filer~~o

~~Smaller Reporting Company~~o


	Fiscal 2011
						Income from Continuing Operations
	SG&A			Operating Income		Amount		Per Diluted Share
As Reported: (GAAP Basis)	$	1,718,617		$	1,304,924	$	880,800	$	2.92
Excluding items affecting comparability		(25,678	)		25,678		0		0.00
Adjusted: (Non-GAAP Basis)	$	1,692,939		$	1,330,602	$	880,800	$	2.92


	Fiscal 2009
						Income from Continuing Operations
	SG&A			Operating Income		Amount			Per Diluted Share
As Reported: (GAAP Basis)	$	1,350,697		$	971,913	$	623,369		$	1.91
Excluding items affecting comparability		(28,365	)		28,365		(1,241	)		0.00
Adjusted: (Non-GAAP Basis)	$	1,322,332		$	1,000,278	$	622,128		$	1.91


	Fiscal 2008
						Income from Continuing Operations
	SG&A			Operating Income		Amount			Per Diluted Share
As Reported: (GAAP Basis)	$	1,259,974		$	1,147,129	$	783,039		$	2.17
Excluding items affecting comparability		(32,100	)		32,100		(41,037	)		(0.11	)
Adjusted: (Non-GAAP Basis)	$	1,227,874		$	1,179,229	$	742,002		$	2.06



								Net Income
Fiscal 2015	Gross Profit		SG&A			Operating Income		Amount		Per Diluted Share
As Reported: (GAAP Basis)	$	2,908.6	$	2,290.6		$	618.0	$	402.4	$	1.45
Excluding items affecting comparability	9.7		(160.8		)	170.5		128.8		0.47
Adjusted: (Non-GAAP Basis)	$	2,918.3	$	2,129.8		$	788.5	$	531.2	$	1.92

								Net Income
Fiscal 2014	Gross Profit		SG&A			Operating Income		Amount		Per Diluted Share
As Reported: (GAAP Basis)	$	3,297.0	$	2,176.9		$	1,120.1	$	781.3	$	2.79
Excluding items affecting comparability	82.2		(49.3		)	131.5		88.3		0.31
Adjusted: (Non-GAAP Basis)	$	3,379.2	$	2,127.6		$	1,251.6	$	869.6	$	3.10

								Net Income
Fiscal 2013	Gross Profit		SG&A			Operating Income		Amount		Per Diluted Share
As Reported: (GAAP Basis)	$	3,698.1	$	2,173.6		$	1,524.5	$	1,034.4	$	3.61
Excluding items affecting comparability	4.8		(48.4		)	53.2		32.6		0.11
Adjusted: (Non-GAAP Basis)	$	3,702.9	$	2,125.2		$	1,577.7	$	1,067.0	$	3.73

								Net Income
Fiscal 2012	Gross Profit		SG&A			Operating Income		Amount		Per Diluted Share
As Reported: (GAAP Basis)	$	3,466.1	$	1,954.1		$	1,512.0	$	1,038.9	$	3.53
Excluding items affecting comparability	—		(39.2		)	39.2		—		—
Adjusted: (Non-GAAP Basis)	$	3,466.1	$	1,914.9		$	1,551.2	$	1,038.9	$	3.53

								Net Income
Fiscal 2011	Gross Profit		SG&A			Operating Income		Amount		Per Diluted Share
As Reported: (GAAP Basis)	$	3,023.5	$	1,718.6		$	1,304.9	$	880.8	$	2.92
Excluding items affecting comparability	—		(25.7		)	25.7		—		—
Adjusted: (Non-GAAP Basis)	$	3,023.5	$	1,692.9		$	1,330.6	$	880.8	$	2.92



	June 27, 2015
	GAAP Basis (As Reported)		Transformation and Other Actions			Acquisition-Related Costs			Acquisition-Related Purchase Accounting			Non-GAAP Basis (Excluding Items)
	(dollars in millions, except per share data)
Gross profit	$	2,908.6	$	(5.0	)	$	—		$	(4.7	)	$	2,918.3
SG&A expenses	2,290.6		140.9			17.1			2.8			2,129.8
Operating income	618.0		(145.9		)	(17.1		)	(7.5		)	788.5
Income before provision for income taxes	611.6		(145.9		)	(17.1		)	(7.5		)	782.1
Provision for income taxes	209.2		(38.1		)	(3.6		)	—			250.9
Net income	402.4		(107.8		)	(13.5		)	(7.5		)	531.2
Diluted net income per share	1.45		(0.39		)	(0.05		)	(0.03		)	1.92


	Fiscal Year Ended
	Net Sales							Percentage of Total Net Sales
	June 30, 2012		July 2, 2011		Rate of Change			June 30, 2012			July 2, 2011
	(dollars in millions)				(FY12 vs. FY11)
Direct-to-Consumer	$	4,231.7	$	3,646.4		16.1	%		88.8	%		87.7	%
Indirect		531.5		512.1		3.8			11.2			12.3
Total net sales	$	4,763.2	$	4,158.5		14.5			100.0	%		100.0	%


⁽¹⁾	Net sales in the Other category consists of Coach brand ancillary channels in fiscal 2015, including licensing and disposition, and sales generated by the Stuart Weitzman brand during the final two months of fiscal 2015.


⁽¹⁾	Operating income in the Other category consists of sales and expenses in Coach brand ancillary channels in fiscal 2015, including licensing and disposition, and sales and expenses generated by the Stuart Weitzman brand during the final two months of fiscal 2015.



	Fiscal Year Ended
	June 28, 2014				June 29, 2013					Variance
	(dollars in millions, except per share data)
	Amount		% of net sales		Amount			% of net sales		Amount			%
Net sales	$	4,806.2	100.0	%	$	5,075.4		100.0	%	$	(269.2	)	(5.3	)%
Gross profit	3,297.0		68.6		3,698.1			72.9		(401.1		)	(10.8	)
Selling, general and administrative expenses	2,176.9		45.3		2,173.6			42.8		3.3			0.2
Operating income	1,120.1		23.3		1,524.5			30.0		(404.4		)	(26.5	)
Interest income, net	2.2		—		2.4			—		(0.2		)	(8.3	)
Other expense	—		—		(6.4		)	(0.1	)	6.4			(100.0	)
Provision for income taxes	341.0		7.1		486.1			9.6		(145.1		)	(29.9	)
Net income	781.3		16.3		1,034.4			20.4		(253.1		)	(24.5	)
Net Income per share:
Basic	$	2.81			$	3.66				$	(0.85	)	(23.2	)%
Diluted	$	2.79			$	3.61				$	(0.82	)	(22.7	)%



	June 28, 2014
	GAAP Basis (As Reported)		Transformation and Other Related Actions			Non-GAAP Basis (Excluding Items)
Gross profit	$	3,297.0	$	(82.2	)	$	3,379.2
SG&A expenses	2,176.9		49.3			2,127.6
Operating income	1,120.1		(131.5		)	1,251.6
Income before provision for income taxes	1,122.3		(131.5		)	1,253.8
Provision for income taxes	341.0		(43.2		)	384.2
Net income	781.3		(88.3		)	869.6
Diluted net income per share	2.79		(0.31		)	3.10