Guess Inc. slightly narrowed its first-quarter loss from a year ago.
For the quarter ended May 5, the company said the net loss was $21.2 million, or 27 cents a diluted share, compared with the year ago loss of $21.3 million, or 26 cents. The adjusted net loss was $17.8 million, or 23 cents a diluted share. Net revenues rose 14.7 percent to $521.3 million from $454.3 million.
Victor Herrero, chief executive officer, said the results finished “above the high-end of our expectations for revenues, adjusted operating margin and adjusted earnings per share.”
He also said revenues in the quarter were driven by “continued momentum in Europe and Asia. We were also able to expand the company’s operating margin, despite cost pressures related to our transition to our new distribution center in Europe.”
For its Americas business, Herrero said the company’s retail component ended the quarter with “positive comps while being significantly less promotional.” Retail comps in the quarter, including e-commerce, rose 2 percent in U.S. dollars, and 1 percent in constant currency. The Americas wholesale business saw revenues rise 13.4 percent in U.S. dollars, and up 11.3 percent in constant currency.
The ceo also cited the brand’s “continued momentum, as the first quarter marks the seventh consecutive quarter of revenue growth for the company. For me, it speaks to the global strength and potential of the Guess brand.”
He added that the company remains focused on executing its strategic initiatives.
The company also noted that operating margin for the Americas retail segment gained 910 basis point to negative 3.3 percent in the quarter, an improvement from negative 12.4 percent in the year-ago quarter, driven mostly by the favorable impact from lower markdowns, negotiated rent reductions and higher initial markups. Operating margin for Americas wholesale segment fell 470 basis points to 14.8 percent in the quarter from 19.5 percent a year ago, due primarily to lower gross margins.
The company guided second-quarter GAAP EPS to between 27 cents and 30 cents, with adjusted EPS in the same range. It expects net revenues to rise 14 to 15.5 percent. For fiscal 2019, the company forecasted GAAP EPS at between 84 cents to 95 cents, with adjusted EPS at between 88 cents to 99 cents. Revenues are expected to rise 8.5 to 9.5 percent for the year.
Shares of Guess closed down 1.1 percent to $24.33. The company posted its quarterly results after the equity markets closed. In after-hours trading, shares of Guess fell 1.3 percent to $24.01.