Canada Goose(US:GOOS)2022-05-19 15:54Financial Data and Key Metrics Changes - Canada Goose achieved record sales, surpassing $1 billion for the first time in fiscal 2022 [7] - The company expects fiscal 2023 revenue between $1.3 billion and $1.4 billion, with EBIT margins projected between 19% and 21% [9][30] - Adjusted EBIT margin for fiscal 2022 was 15.9%, with adjusted EPS at $1.09 [29] Business Line Data and Key Metrics Changes - Direct-to-Consumer (DTC) revenue represented over two-thirds of total business at $740 million, with DTC gross margins at 76% [16][28] - Non-parka revenue grew by over 70% in fiscal 2022, indicating strong demand for year-round offerings [19][34] - Wholesale revenue is expected to increase by approximately 6% in fiscal 2023 [32] Market Data and Key Metrics Changes - North America was the biggest driver of growth, with consumer confidence returning to pre-pandemic levels [10] - The APAC region saw a decline due to COVID restrictions, particularly in Mainland China [10] - The joint venture in Japan is expected to contribute $60 million to $65 million in revenue for fiscal 2023 [32] Company Strategy and Development Direction - The company aims to increase its DTC mix and expand its retail network by adding up to 13 stores globally [17][81] - Canada Goose is focusing on sustainability, with a commitment to using more recycled and responsibly sourced materials [21][22] - The company is pursuing category expansion, particularly in non-parka offerings and footwear [19][91] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the brand and business despite challenges, citing a unique supply chain advantage [11][26] - The outlook for fiscal 2023 is optimistic, with expectations of strong consumer demand and improved retail productivity [46] - Management does not expect a full recovery of international tourism to impact their guidance significantly [94] Other Important Information - The company has appointed new leadership roles to strengthen its commercial operations and board [12][13] - Canada Goose has committed to net zero carbon emissions by 2025 and has signed onto the United Nations Global Compact [22][23] Q&A Session Summary Question: What are Carrie Baker's priorities in her new role? - Carrie Baker emphasized executing with excellence and creating impact from both consumer and financial perspectives [50] Question: Can you elaborate on the outlook for Mainland China? - Jonathan Sinclair noted that Q1 is expected to be heavily impaired, with a gradual improvement anticipated in Q2 and normal business levels expected in Q3 [51] Question: How is the wholesale channel performing? - Dani Reiss stated that the wholesale channel is progressing well, with strong sell-throughs and increased order books [54] Question: What is the rationale behind the revenue growth guidance? - Jonathan Sinclair explained that the guidance is based on healthy comparable growth and pricing power, with expectations for continued unit growth [58] Question: What are the capital allocation priorities for fiscal '23? - Jonathan Sinclair indicated that the best use of cash is to invest in the business, with ongoing investments in store estate and manufacturing facilities [68] Question: What assumptions underpin the confidence in achieving DTC growth? - Jonathan Sinclair mentioned expectations of pricing impacts, product development, and a gradual resumption of traffic as key factors [72]