Guess Q4 profits widen as Europe shines, but stock falls on earnings outlook
Guess has reported an increase in earnings and revenue in the fourth quarter as its Europe market performed strongly, but its shares fell due to a lower-than-expected profit outlook.
The US fashion retailer made GAAP net earnings of 95.8 million dollars in the quarter ended January 28, up from 68.4 million dollars a year earlier.
That came as net revenue increased 817.8 million dollars, up 2 percent from a year ago, or up 8 percent on a constant-currency basis.
In the Americas, retail revenues fell one percent, while wholesale revenue plummeted 27 percent.
Asia revenue was down 1 percent, or up 10 percent on a constant currency basis, but Europe was the best performer, increasing 10 percent, or up 20 percent in constant currencies.
Licensing revenue decreased 8 percent.
Chief executive Carlos Alberini said he was “pleased” by the fourth-quarter performance, which exceeded the company’s expectations, driven by “strong results in Europe”.
Full-year profit narrows
For the full year, GAAP net earnings fell to 149.6 million dollars from 171.4 million dollars a year earlier.
Alberini noted that currency fluctuations consumed 62 million dollars of operating profit and 140 basis points of operating margin during the year.
Net revenue for the year came in at 2.69 billion dollars, up 4 percent on the prior year, or up 12 percent on a constant currency basis.
“This performance caps a strong year for our Company despite the challenging market conditions we faced,” Alberini said.
Looking ahead, the company now expects consolidated net revenue for the 2024 fiscal year to increase by between 1 percent and 3 percent. However, it expects a year-on-year drop of as much as 7 percent in the first quarter.
The company expects full-year net earnings per share of between 2.45 dollars and 2.80 dollars. The company's shares slid on the lower-than-expected profit outlook.