The US clothing retailer Guess Inc. generated lower sales and profits in the third quarter of the 2022/23 financial year than in the same period of the previous year. CEO Carlos Alberini was nevertheless satisfied: In an interim report published on Tuesday evening, he emphasized that the revenues and operating result had exceeded his own expectations despite the difficult general conditions in retail.
For the three months ended October 29, consolidated sales were $633.4 million (€614.3 million). It was two percent below the level of the same quarter of the previous year. Adjusted for exchange rate changes, however, revenues increased by ten percent.
In America, sales are shrinking both in own retail (-2 percent, currency-adjusted -1 percent) and in the wholesale business (-10 percent, currency-adjusted -9 percent). In the other market regions, the strong development of the US dollar impacted the results. Sales in Europe fell by two percent, but increased by 17 percent after currency adjustments. In Asia, sales grew by ten percent (currency-adjusted +28 percent). Worldwide license income exceeded the corresponding prior-year level by four percent.
Operating income fell 17 percent to $54.8 million as a result of increased costs and discounts. Net income attributable to shareholders was $21.8 million, down 27 percent from the prior-year quarter.
In the first nine months of the current financial year, Guess was able to increase its sales by four percent (currency-adjusted +14 percent) to USD 1.87 billion. However, net income attributable to shareholders shrank 48 percent to $53.8 million.
In view of the latest development, management has raised its sales forecast for the full year: It now expects an increase of around 2.0 percent (currency-adjusted +10.5 percent), after previously only growth of 1.5 percent (currency-adjusted +9. 5 percent) was expected. However, the target for diluted earnings per share was lowered from $2.11 to $1.82.