S&P turns Tory Burch view to positive

S&P said it changed its outlook for Tory Burch to positive from stable and affirmed the BB- ratings on the issuer and its first-lien credit facilities.

“Fiscal 2021 operating performance has been better than expected as the company benefitted from strong recovery in all its sales channels, particularly in North America and China. The company had positive comparable store sales in 2021 and reported 36% revenue growth in the year. We expect continued double-digit sales growth in 2022 driven by new store openings,” the agency said in a press release.

Tory Burch plans to open 25 new stores in 2022 with 16 in China.

“Despite recent stringent social restrictions and lockdowns related to the Covid-19 pandemic, we believe growth prospects in China remain strong as the company is still relatively underpenetrated in China, which represents approximately 10% of sales. Since China is a higher margin market compared with other regions, we believe the company's growth strategy will further lead to margin expansion,” S&P said.

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