U.S. fashion label Guess Inc. announced on November 22 total revenues for the third quarter decreased 2 percent to USD 633.4 million, but rose 10 percent in constant currency, helped by a double-digit gain in its Asia market.
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For the three months ending October 29, Guess Asia revenues increased 10 percent in U.S. dollars and 2 percent in constant currency. Asia retail comparable sales, including e-commerce, decreased 2 percent in U.S. dollars and increased 13 percent in constant currency, said the Los Angeles-based company.
In Europe, revenues decreased 2 percent in U.S. dollars and increased 17 percent in constant currency, while Americas retail revenues decreased 2 percent in U.S. dollars and 1 percent in constant currency.
Licensing revenues increased 4 percent in U.S. dollars and constant currency.
Net earnings fell 27 percent to USD 21.8 million, from USD 29.9 million for the same prior-year quarter.
“We are pleased with our third quarter financial results, which exceeded our revenue and operating profit expectations in a challenging retail environment,” said Carlos Alberini, chief executive officer.
“Our revenues decreased by almost 2 percent in U.S. dollars but grew 10 percent in constant currency, driven primarily by the strength of our business in Europe. For the period, we managed the business well and delivered an 8.6 percent operating margin and USD 55 million in operating profit. Lower performance-based compensation helped us partially offset the gross margin pressure we experienced as a result of the adverse currency impact associated with the strong U.S. dollar and lower full price selling.”
Likewise, Guess Asia revenues increased 5 percent in U.S. dollars and 17 percent in constant currency for the first nine months of the year. Asian retail comp sales, including e-commerce, decreased 5 percent in U.S. dollars and increased 5 percent in constant currency.
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The company recorded net earnings of USD 53.8 million for the first nine months, a 47.8 percent decrease from USD 102.9 million for the same prior-year period.
For the full fiscal 2023, Guess said it expects revenues to be up around 2 percent in U.S. dollars or 10.5 percent in constant currency, versus fiscal 2022.