Guess' “strong performance” sees Q2 revenues boosted to £528 million

Retail giant and denim expert, Guess? Inc., has once again reported "better-than-expected" results for the second quarter of the fiscal year, ending 3 February 2024.

The company recorded revenues reached £528 million ($665 million), up by 3% compared to the corresponding period the year prior. GAAP net earnings sat at £30 million ($39 million), a 63% increase from £19 million ($24 million year-on-year).

GAAP diluted net earnings per share (EPS) increased by 69% to £0.47 ($0.59), compared to £0.38 ($0.35) the year prior. Adjusted net earnings were £31.5 million ($39.7 million), a 74% increase from £18.1 million ($22.9 million).

In terms of geographical location, Europe revenues increased 9% in US dollars and 8% in constant currency. Operating margin for the European segment increased 2.6% to 12.9%, from 10.3% in the same prior-year quarter. This increase was driven by ‘initial markups, the favourable impact of higher revenues and lower markdowns'. However, this was partially offset by the unfavourable impact of currency and higher expenses.

Overall, for the six months ending 29 July 2023, Guess recorded GAAP net earnings of £21.6 million ($27.2 million), a 15% decrease from £25.3 million ($31.9 million) the year prior. The company recorded adjusted net earnings of £28.7 million ($36.2 million), a 5% decrease from $38.1 million year-on-year.

Total net revenues flatlined to £980 million ($1.23 billion) from £980 million ($1.24 billion). In constant currency, net revenue increased by 1%.

Looking ahead, the company expects revenues to increase by 2.5-4% and adjusted operation margin to sit between 9-9.4%

Carlos Alberini, Chief Executive Officer, commented: "We are very pleased with our second quarter performance, which exceeded our expectations for top line growth and delivered a significant beat in operating earnings and earnings per share for the period. Our international businesses continued to perform strongly with robust revenue growth and our Americas Retail business achieved a sequential improvement in performance compared to the first quarter, as we drove better customer conversion in stores.

"Most of our businesses delivered better-than-expected operating results, driven by solid revenue performance, strong gross margin results and effective cost management, which contributed to an operating profit of $65 million and a 9.7% operating margin for the period, well ahead of our expectations."