Guess Narrows Q1 Loss
The Americas business remained soft in the quarter.
Shares of Guess Inc. on Wednesday spiked up 14.8 percent in early after-market trading following the company’s posting of first-quarter results that beat Wall Street’s estimates.
For the three months ended April 29, the net loss narrowed to $21.3 million, or 26 cents a diluted share, compared with a net loss of $25.2 million, or 30 cents, a year ago. On an adjusted basis, the loss was 24 cents, compared with 23 cents last year. Net revenues in the quarter rose 2.2 percent to $458.6 million from $448.8 million. The increase included a 2.8 percent gain in product sales to $438.3 million.
Wall Street was expecting a net loss of 32 cents on revenues of $449.2 million.
Victor Herrero, chief executive officer, said, “We continued to see strong performance in our international businesses. In Europe and Asia, our revenues were up 23 percent and 17 percent, driven by new store openings and positive comp sales….In the Americas, as the performance of our business and the environment remain soft, we are more than ever focused on shrinking our footprint and profitability improvements.”
The company said its Americas retail revenues fell 14.9 percent, while retail comp sales, including e-commerce, declined 15 percent. Wholesale revenues for the region rose 5.7 percent.
Herrero emphasized that the company is staying connected with its customers and their aspirations. “The Guess brand has always been associated with sexy, and sexy is being more broadly interpreted where anyone can be sexy. Authenticity is ‘in,’ and being real is more important than being perfect. The Millennial and Gen Z consumer is seeking purpose-driven brands whose values align with their own. As always, we are adapting to this changing environment,” the ceo said.
For the second quarter ending July 29, the company guided adjusted EPS at between 8 cents to 11 cents. For fiscal year 2018, the company forecasted adjusted EPS at between 34 cents and 44 cents.
Shares of Guess on Wednesday closed down 0.8 percent to $9.98.