NEW YORK — Positive operating results in all three of Guess Inc.’s segments helped the company record third-quarter earnings that exceeded analysts’ expectations and almost doubled year-ago results.
The Los Angeles-based jeansmaker reported net income of $6.7 million, or 15 cents a diluted share, in the quarter ended Sept. 27. That compared with earnings of $3.4 million, or 8 cents a share, a year earlier. According to Thomson Financial/First Call, Wall Street analysts had expected earnings of 11 cents a share. Net revenues were up 5.6 percent to $166.7 million.
“We are pleased that our bottom line has started to reflect the effort we have made to utilize our resources efficiently,” Carlos Alberini, president and chief operating officer, said in a conference call with analysts.
For more than a year, Guess has been focusing on cutting expenses in an effort to boost margins. The company’s retail segment reported operating income of $9.5 million, more than five times the $1.7 million reported a year earlier. Sales were up 20.5 percent to $114.2 million.
Alberini said women’s nondenim bottoms did particularly well in the quarter, though he also reported better sales of basic denim bottoms.
Wholesale volume and earnings continued to slide. Operating income was $2.4 million, down 30.6 percent from $3.5 million. Sales came in at $42.4 million, off 16.6 percent.
Nonetheless, Alberini said there were “early signs of a rebound in our wholesale business.” He said the company’s wholesale account base had stabilized at around 800 stores and said he expected fourth-quarter wholesale revenues to rise by a percentage range in the teens.
Income from licensing operations was off 10.9 percent to $8.5 million. Licensing revenues were off 17.5 percent to $10.1 million.
Alberini added that he expected comparable-store sales at the firm’s chain of signature stores to be up by mid-single digit percentages in the fourth quarter, with total retail volume from its 258 units to increase by midteen percentages. By the year’s end, the company will have opened 20 new stores in 2003.
Guess released its results after the close of trading Monday. Its shares remained unchanged, at $11.25 on the New York Stock Exchange.
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