Guess Profit Tops Estimates

(RTTNews) - International fashion house Guess?, Inc. (GES) said Wednesday after the markets closed that its fourth quarter profit fell 23% from last year, as revenue fell 9.3% partly due to a stronger U.S. dollar.

However, the company's quarterly earnings per share came in above analysts' expectations, but its quarterly revenue fell short of analysts' forecast. At the same time, the company gave weak outlook for the first quarter and the fiscal year 2016.

Paul Marciano, Chief Executive Officer of Guess?, said, "Overall fourth quarter results were in line with our expectations. In North America, we were pleased by the emerging trends, as comps and traffic improved in the back-end of the quarter. Our E-commerce business continues to show strength, with 37% growth in the quarter."

Guess shares are currently gaining 12.19% in after hours trading after closing the day's regular trading session at $16.74, down 42 cents or 2.45%. The shares trade in a 52-week range of $16.61 to $29.50.

Guess has been struggling for the past few quarters, with intense competition in key markets, weak traffic and soft consumer sentiment. The strengthening of the U.S. dollar is also hurting its results, as the company generates a large chunk of its sales overseas.

For the fourth quarter ended January 31, 2015, the Los Angeles-based company reported net income of $53.9 million or $0.63 per share, compared to $69.6 million or $0.82 per share for the year-ago quarter.

On average, 12 analysts polled by Thomson Reuters expected the company to earn $0.57 per share for the fourth quarter.

Total net revenue for the fourth quarter fell 9.3% to $696.73 million from $768.36 million in the same quarter last year. Fourth quarter net revenue decreased 4.1% in constant currency. Twelve analysts had a consensus revenue estimate of $704.59 million for the fourth quarter.

For the fourth quarter, North American Retail revenues decreased 3.7% to $317.0 million; retail same-store sales including e-commerce declined 5%. North American Wholesale revenues fell 10.2% to $36.6 million.

European revenues dropped 16.1% to $240.9 million in the fourth quarter. European revenues decreased 5% in constant currency.

Asian revenues decreased 9.1% to $75.4 million in the fourth quarter. In constant currency, Asian revenues fell 7%.

Looking forward to the first quarter, the company forecasts net revenue decline between 8 and 7 percentage points and a loss of $0.06 to $0.03 per share. Analysts currently expect the company to post a loss of $0.03 per share on revenue decline of 6% for the first quarter.

For the fiscal year ending January 30, 2016, the company forecasts net revenue decline between 9 and 7 percentage points and earnings of $0.75 to $0.95 per share. Analysts currently expect the company to earn $1.04 per share on revenue decline of 2.5% for the fiscal year 2016.