In the Americas, retail revenue declined significantly, down 14% in US dollars and 13% in constant currency. Offset sales, including e-commerce, were also down 12%. Additionally, Americas wholesale revenue was down sharply by 25% in U.S. dollars and 26% in constant currency, the company said in its financial results for its first quarter ended April 29, 2023.
U.S.-based fashion brand Guess reported a 4% year-over-year decline in net revenue to $569.8 million in the first quarter of FY24 and a GAAP operating loss of $0.9 million. Revenues from the Americas declined, Europe recorded modest growth, while Asia performed strongly. The company’s net loss in the first quarter of FY24 was $11.8 million, with a diluted loss per share of $0.22.
European revenue edged up 2% in US dollars and 5% in constant currency, with comp retail sales, including e-commerce, showing robust growth of 10% in US dollars and 13% in constant currency. Meanwhile, Asia posted a commendable performance with a 26 percent increase in revenue in US dollars and a 34 percent rise in constant currency. This was supported by a modest increase in retail component sales, which rose 1% in US dollars and 8% in constant currency. Conversely, licensing revenue was down 10% in US dollars and constant currencies.
The company incurred a GAAP operating loss of $0.9 million in the first quarter of FY24, compared to a GAAP operating profit of $36.4 million in the same period of the year former. This caused the GAAP operating margin to decline from 6.1% to minus 0.2%. Adjusted operating profit also declined significantly by 95% to $1.9 million from $41.7 million in Q1 FY23, resulting in lower adjusted operating margin from 6.7% to 0.3%.
“We are pleased with our first quarter financial results which exceeded our expectations in terms of revenue, operating margin and earnings per share. Our international business was particularly strong during the quarter. This performance, coupled with tight cost control and strong product margin performance, more than offset weakness in our Americas retail business due to slower customer traffic in our stores. I believe our results this quarter highlight the power of our highly diversified business model and the strength of our brands and global distribution,” said Carlos Alberini, General Manager.
For the first quarter of FY24, Guess reported a GAAP net loss of $11.8 million, which contrasts sharply with GAAP net income of $8 million in the same quarter a year earlier. This equates to a GAAP diluted net loss per share of $0.22, compared to GAAP diluted net earnings per share (EPS) of $0.12 in Q1 FY23. The company’s adjusted net loss was $3.5 million, up from adjusted net income of $15.2 million in the year-ago quarter. This translated to an adjusted diluted net loss per share of $0.07, compared to an adjusted diluted EPS of $0.24 in Q1 FY23.
Fibre2Fashion (DP) Press Office