Net revenue of American fashion brand Guess at $569.8 mn in Q1 FY23

In the Americas, retail revenues experienced a significant dip, with a decrease of 14 per cent in US dollars and 13 per cent in constant currency. Comp sales, inclusive of e-commerce, were also down by 12 per cent. Moreover, Americas wholesale revenues reported a sharp decline of 25 per cent in US dollars and 26 per cent in constant currency, the company said in its financial results for its first quarter ended April 29, 2023.

European revenues increased modestly by 2 per cent in US dollars and 5 per cent in constant currency, with retail comp sales, inclusive of e-commerce, showing a robust growth of 10 per cent in US dollars and 13 per cent in constant currency. Meanwhile, Asia posted a commendable performance with a 26-per cent increase in revenues in US dollars and a 34 per cent rise in constant currency. This was underpinned by a modest increase in retail comp sales, which grew by 1 per cent in US dollars and 8 per cent in constant currency. Conversely, licensing revenues saw a decrease of 10 per cent in both US dollars and constant currency.

The company incurred a GAAP loss from operations of $0.9 million in Q1 FY24, compared to GAAP earnings from operations of $36.4 million in the same period of the previous year. This resulted in a decrease in GAAP operating margin from 6.1 per cent to negative 0.2 per cent. Adjusted earnings from operations also decreased substantially by 95 per cent to $1.9 million, from $41.7 million in Q1 FY23, causing the adjusted operating margin to shrink by 6.7 per cent to 0.3 per cent.

“We are pleased with our first quarter financial results which exceeded our expectations for revenues, operating margin and earnings per share. Our international businesses were particularly strong during the quarter. This performance, coupled with strong cost controls and solid product margin performance, helped to more than offset softness in our Americas retail business as a result of slower customer traffic into our stores. I believe that our results this quarter highlight the power of our highly diversified business model and the strength of our brands and global distribution,” said Carlos Alberini, chief executive officer.

For Q1 FY24, Guess recorded a GAAP net loss of $11.8 million, marking a stark contrast to the GAAP net earnings of $8 million in the same quarter of the previous year. This equated to a GAAP diluted net loss per share of $0.22, compared to the GAAP diluted net earnings per share (EPS) of $0.12 in Q1 FY23. The company's adjusted net loss was $3.5 million, in contrast to the adjusted net earnings of $15.2 million in the previous year's equivalent quarter. This resulted in an adjusted diluted net loss per share of $0.07, compared to an adjusted diluted EPS of $0.24 in Q1 FY23.

Fibre2Fashion News Desk (DP)