Guess revenues decline in Q4 and FY15

Guess in its unaudited financial results for its fourth quarter and fiscal year ended January 31, 2015 said that while global revenues decreased 6 percent at 2.4 billion dollars; decline was 5 percent in constant currency. For the fourth quarter, North American retail revenues decreased 4 percent and retail comparable sales including e-commerce decreased 5 percent in dollars and 3 percent in constant currency.

Adjusted operating earnings for FY15 decreased 46 percent and GAAP operating earnings decreased 43 percent. European revenues during the fourth quarter decreased 16 percent in dollars and 5 percent in constant currency, while Asian revenues decreased 9 percent in dollars and 7 percent in constant currency. North American wholesale revenues decreased 10 percent in dollars and 7 percent in constant currency. Adjusted operating earnings for the quarter, declined 30 percent; whereas GAAP operating earnings decreased 29 percent.

For the fourth quarter of fiscal 2015, the company recorded net earnings of 53.9 million dollars, a 24.1 percent decrease compared to adjusted net earnings of 71.1 million dollars for the fourth quarter of fiscal 2014. Diluted earnings per share decreased 24.1 percent.

“Overall fourth quarter results were in line with our expectations. In North America, we were pleased by the emerging trends, as comps and traffic improved in the back-end of the quarter. Our E-commerce business continues to show strength, with 37 percent growth in the quarter and almost 80 million dollars in revenues for the full year,” said Paul Marciano, Chief Executive Officer.

“Turning to the outlook for fiscal year 2016, currencies will definitely be a headwind if they stay at current levels. But, we will continue investing in our omni-channel strategy globally and expect it to be a growth vehicle for fiscal 2016," Marciano added.

Total net revenue for the fourth quarter of fiscal 2015 decreased 9.3 percent to 696.7 million dollars, from 768.4 million dollars in the prior-year quarter. In constant currency, total net revenue decreased 4.1 percent. Licensing segment net revenue decreased 5.8 percent to 26.8 million dollars. Operating earnings for the fourth quarter of fiscal 2015 decreased 30.1 percent and operating margin decreased 310 basis points to 10.5 percent.

Net earnings for the fiscal year were 94.6 million dollars, a decrease of 41.8 percent compared to adjusted net earnings of 162.5 million dollars for the fiscal year ended February 1, 2014. Diluted earnings per share decreased 41.9 percent. The company's retail stores and e-commerce sites in North America generated revenue of 1.03 billion dollars in fiscal 2015, a decrease of 4 percent from 1.08 billion dollars in the prior year. Comparable store sales including the results of our e-commerce sites for fiscal year 2015 decreased 4.9 percent in dollars and 3.6 percent in constant currency compared to the prior year.

Net revenue from the company's Europe segment decreased 8.7 percent and decreased 6.3 percent on constant currency basis. The company's Asia segment revenues decreased 4 percent. For North American wholesale segment, decline was of 6.6 percent. Licensing segment net revenue decreased 6 percent and operating earnings for fiscal year 2015 decreased 46.4 percent. Operating margin for fiscal decreased 390 basis points to 5.2 percent compared to adjusted operating margin of 9.1 percent in the prior year.

The company, for the first quarter of fiscal 2016 ending May 2, 2015, expects consolidated net revenues to grow between 1 and 2 percentage points in constant currency. Currency headwinds are expected to negatively impact consolidated revenue growth by approximately 9 percentage points, for a net decline between 8 and 7 percentage points. Operating margin is expected to be between minus 1.5 percent and minus 1 percent and includes 50 basis points of currency headwind. Diluted net loss per share is expected to be in the range of 0.06 dollars to 0.03 dollars.

For the fiscal year ending January 30, 2016, the company expects consolidated net revenues to range between a decline of minus 1 percentage point and an increase of 1 percentage point in constant currency. Currency headwinds are expected to negatively impact consolidated revenue growth by approximately 8 percentage points, for a net decline between 9 and 7 percentage points. Operating margin is expected to be between 4.5 percent and 5.5 percent and includes 150 basis points of currency headwind. Diluted earnings per share are expected to be in the range of 0.75 dollars to 0.95 dollars. The company also announced that its Board of Directors has approved a quarterly cash dividend of 0.225 dollars per share on the company's common stock.