By  on March 18, 2010

Buoyed by strong sales in Europe, Guess Inc. Wednesday reported that fourth-quarter net income jumped 83 percent. The Los Angeles-based apparel retailer and wholesaler also issued 2010 guidance that was well above analysts’ estimates.

The firm said that for period ended Jan. 30, profits rose to $87.9 million, or 93 cents a diluted share, from year-ago levels of $48 million, or 51 cents a share. Excluding impairment charges, the company’s net earnings totaled $89.3 million, or 96 cents.

Quarterly revenues rose 14.4 percent to $642 million from $561.1 million a year earlier. Aided by fewer promotions, gross margin expanded to 46 percent of sales from 40.5 percent in the prior-year period.

Analysts surveyed by Yahoo expected EPS of 81 cents a share on sales of $601.7 million.

European revenues increased 23.7 percent to $222.6 million, “fueled by retail expansion” in the region, the company said, as North American retail revenues grew 7.2 percent to $309.4 million. Same-store sales in North America rose 5.3 percent. Wholesale volume expanded 21 percent to $84.7 million, and licensing operations improved 12 percent to $25.4 million.

On a conference call, chief executive officer Paul Marciano touted the company’s growth in Europe and said, in the next two to three years, he hopes to grow European sales to $1 billion by opening new stores and investing in marketing. European expansion is a “key priority,” he said and, as a result, the firm plans to open 85 stores in the region, bringing the total of stores in Europe to 380 by year’s end. The firm projects 52 new stores in North America as well.

Guess operates 432 stores in the U.S. and Canada, and 778 stores outside of North America.

For the year, Guess said net income increased 14.6 percent to $246.3 million, or $2.61 a diluted share, compared with profits of $215 million, or $2.25 a share, in 2008. Revenues edged up 1.7 percent to $2.13 billion from $2.09 billion.

The vendor anticipates first-quarter EPS to be between 46 cents and 48 cents, and consolidated net revenues to be between $495 million and $510 million. For the year, EPS is expected to be in the range of $2.87 to $2.95, on sales of between $2.3 billion and $2.35 billion. Prior to the release of guidance, analysts were looking for first-quarter EPS of 47 cents on sales of $484.2 million, and yearly profits of $2.51 a share on revenues of $2.09 billion.

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