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For the second quarter of fiscal 2023, the company recorded GAAP net earnings of $24.0 million, a 60.8 per cent decrease from $61.1 million for the same prior-year quarter. GAAP diluted net earnings per share (“EPS”) decreased 61.5 per cent to $0.35 for the second quarter of fiscal 2023, compared to $0.91 for the same prior-year quarter. The company estimates a net positive impact from its adoption of the accounting guidance related to the company’s convertible notes and share buybacks of $0.06 and a negative impact from currency of $0.17 on GAAP diluted EPS in the second quarter of fiscal 2023 when compared to the same prior-year quarter.
Total net revenue of Guess for the second quarter of 2023 rose 2 per cent to $642.7 million from $628.6 million in the same prior-year quarter. In constant currency, net revenue increased by 12 per cent. Americas retail revenues decreased 2 per cent in US dollars and constant currency. Retail comp sales, including e-commerce, decreased 6 per cent.
“We are pleased with our second quarter results that exceeded our revenue and operating earnings expectations in a challenging retail environment. Our company’s revenues increased 2 per cent in US dollars and 12 per cent in constant currency. These results reflected a strong performance of our wholesale business in Europe, partially offset by softer sales in our America’s Retail business. Our adjusted operating earnings decreased from last year but exceeded our expectations, as a result of effective expense management partially offset by a margin decline across our businesses. Regarding our goal to return value to our shareholders, during the quarter we successfully completed our previously announced $175 million accelerated share repurchase programme, resulting in the repurchase of 8.5 million shares,” Carlos Alberini, chief executive officer, said.
“We continue to focus on executing our very important brand elevation strategy, which impacts most parts of our business, starting with the product. I am proud of how our teams have worked together to align the design of the product, marketing campaigns, visual presentations in our stores and websites and the product buys to service our customers effectively and optimise sales. Our customers are responding well to the assortments we offer across the Guess and Marciano collections and I believe our brands are well positioned to continue to gain market share,” Paul Marciano, co-founder and chief creative officer, said.
“For the second half of the year, we have adjusted our outlook to reflect our current trends and the impact of existing macro-economic headwinds, including currency. We have a strong team and we continue to manage our business with discipline, focusing on what we can control. We remain confident in our long term opportunities to grow and leverage the power of our highly diversified business model and our strong brand momentum,” Alberini concluded.
For the third quarter of fiscal 2023, the company expects revenues to be down around 4.5 per cent in US dollars (up 4.5 per cent in constant currency) versus the third quarter of fiscal 2022. For the full fiscal year 2023, the company expects revenues to be up around 1.5 per cent in US dollars (9.5 per cent in constant currency) versus fiscal 2022.
Fibre2Fashion News Desk (RR)
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