Rising sales and revenues across all business segments — with the biggest gains in Europe — spurred Guess Inc. to triple-digit earnings gains for the third quarter and first nine months of the year.
For the three months ended Sept. 30, the Los Angeles-based company reported Wednesday that earnings vaulted 133.8 percent to $48.4 million, or $1.05 a share, far outpacing Wall Street analysts'; consensus estimate of 72 cents a share. Guess reported earnings of $20.7 million, or 46 cents, in the same period a year ago.
"All our business formats across all regions of the world exceeded expectations," Paul Marciano, co-chairman and co-chief executive officer, said during a conference call with analysts.
Revenues for the period rose 31.3 percent to $348.7 million from $265.6 million. Royalties were ahead 18.3 percent, rising to $16.4 million from $13.9 million.
Sales increased 32 percent to $332.3 million, compared with $251.7 million, driven by a strong retail performance in the company';s stores across the U.S. and Canada. Guess stores generated $178.1 million during the quarter, an increase of 13.9 percent from the $156.3 million in the year-ago period. Marciano said Guess opened 10 stores in the U.S. and Canada during the quarter for a total of 330 units. Comparable-store sales gained 8.6 percent during the period, marking the 14th consecutive quarter of rising sales in stores open at least a year.
Maurice Marciano, co-chairman and co-ceo, said he sees ample opportunity for the company';s denim business to expand in the U.S. and Canada, as well.
"The trend right now in denim is, it';s going more into fashion denim...so that';s going to give us a really good opportunity," he said, adding that women';s denim would present the biggest opportunity because of the greater range of product offerings available. "The trend is cleaning up. The skinny has been a big part of the business, but as far as our business is concerned, we';ve not seen a slowdown in the boot-leg jean for women, even though the skinny has done very well."
Guess'; European business posted the largest gains during the quarter, with revenues rising 73.1 percent to $111.5 million from $64.4 million. Management has set a target of reaching $500 million in revenues in Europe in the next four years.For the nine months, earnings gained 134.7 percent to $77.5 million, or $1.69 a share, compared with $33 million, or 74 cents, in the same period a year ago. Revenues spiked 27.2 percent to $838.8 million from $659.4 million, with sales rising 27.2 percent to $794.8 million from $624.8 million and royalties increasing 26.8 percent to $43.9 million from $34.6 million.
Again, the company';s European business posted the largest gains, with revenues jumping 60 percent to $209.5 million from $131 million. Wholesale revenues rose 18.4 percent to $104.3 million from $88.1 million, while retail operations generated revenue increases of 18.6 percent to $481 million from $405.7 million.
The company also announced comp-store sales results for October, with the U.S. and Canada posting 11.8 percent gains. For the month, total retail sales rose 17.6 percent to $45.5 million.
The firm has a multibrand portfolio that includes Guess, Guess by Marciano, Marciano Guess Accessories and a new retail format that will roll out in North America next year called G by Guess, which is targeted to compete with retailers such as Hollister.
Exclusive: @britneyspears is continuing to expand her brand. The pop icon, who appears in @kenzo ’s latest campaign, is partnering with Epic Rights to launch a line of branded merchandise. Read @hernameislex ‘s story, link in bio. #wwdnews #britneyspears
The Duchess of Cambridge channeled Princess Diana’s look upon giving birth to Prince Harry, when she and the Duke of Cambridge departed the hospital with the new baby Prince this afternoon in London. #wwdeye #princeofcambridge
The new Prince of Cambridge has arrived! The Duke and Duchess of Cambridge posed with the 8-pound newborn. She wore a look from one of her go-to designers, @jennypackham. Tap link in bio for more. #wwdeye #princeofcambridge
Jewelry label @alisonlou has made a name for itself with fine jewelry that speaks to the Millennial market. Now @twallz21 reports that the label is bringing those playful ideas to a new affordable line of lucite hoops with the launch of Loucite by Alison Lou. Here’s a look from the line modeled by @emrata. #wwdaccessories
@sarahjessicaparker and @gilt are teaming up on a bridal ready-to-wear line. Tomorrow, Parker will launch SJP by Sarah Jessica Parker Bridal — and as part of the launch, Gilt will offer 15 exclusive styles from the SJP by Sarah Jessica Parker footwear collection that were designed to complement the new line. Made out of 10 styles, the line is designed for a variety of occasions, from bridal showers to receptions. Get more details on WWD.com #wwdfashion
A grooming moment between @tanfrance and @antoni last night at the The LGBT Community Center Trailblazer Awards honoring Anna Wintour, Ricky Martin and more. See more photos at WWD.com #wwdeye (📷: @lexieblacklock)
“It was a very surreal feeling. It wasn’t like we were in the studio together coming up with it — it’s more like he discovered it and loved it. I didn’t let myself get my hopes up, but then it happened it was very exciting,” said singer-songwriter @nombe on discovering that @pharrell would be using his song, “Cant Catch Me” on his HBO documentary series “Outpost.” The German-born singer — named Noah MacBeth — talked to WWD about feminism, using art as a platform for political expression and personal style. Read more on WWD.com #wwdeye (📷: @jilliansollazzo)
This season, denim is going west – in influence. Brands like @fathersdaughterla (pictured here), @tommyhilfiger Jeans, @levis and more are opting for raw, top-stitching styles. (Styled by @thealexbadia; 📷: @ryanplett)