Guess(US:GES)2024-05-31 01:32Financial Data and Key Metrics Changes - For Q1 2025, total company revenues grew by 4% to $592 million, with a 7% increase in constant currency [12][26] - Adjusted operating loss was reported at $8 million, with an adjusted loss per diluted share of $0.27, compared to a loss of $0.70 per share in the previous year [14][45] - Total company gross margin reached 41.9%, up 120 basis points from the previous year, driven by higher revenues and improved initial markups [29][45] Business Line Data and Key Metrics Changes - The Americas Retail segment saw revenues increase by approximately 0.5% to $144 million, with comp sales declining by 12% in constant currency [15][57] - The Europe segment reported a 1% revenue increase to $284 million, with double-digit comp growth in retail [31][56] - The Americas Wholesale business grew by 21% to $62 million, primarily due to rag & bone shipments [32][44] Market Data and Key Metrics Changes - In Asia, revenues increased by 3% to $73 million, with retail comps declining by 5% in constant currency [44] - The Licensing segment performed well, with a 21% revenue increase to $29 million, benefiting from the amortization of the handbag license renewal [32][58] Company Strategy and Development Direction - The company aims to leverage its platform to support multiple brands, including the recent acquisition of rag & bone, which is expected to enhance growth opportunities [16][39] - The strategic focus includes expanding product categories and international presence, particularly in Europe and emerging markets [17][39] - The company is also refining its pricing structure and reducing SKU counts to improve operational efficiency [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growth opportunities despite challenges in the retail environment, particularly in the Americas [15][49] - The company expects revenue growth to exceed $3 billion for the first time this year, with adjusted earnings per share projected to be nearly $3 [21][62] - Management acknowledged external factors such as inflation and cautious consumer spending affecting the retail business [49][62] Other Important Information - The company completed its first-ever acquisition of rag & bone, which is expected to contribute significantly to revenue growth [30][39] - A special dividend of $2.25 per share was issued to shareholders, reflecting the company's strong capital structure [48] Q&A Session Summary Question: Revenue guidance for the year and FX impact - Management acknowledged a slight adjustment in revenue guidance due to currency headwinds and performance in the Americas retail business [70][88] Question: Operating margin expansion opportunities - Management highlighted potential for operating margin expansion in the fourth quarter due to improved full-price selling and timing of wholesale shipments [73][75] Question: Expansion of rag & bone internationally - Management discussed plans for expanding rag & bone's retail presence in Europe and the potential for additional product categories [94][96] Question: Multi-branded platform strategy - Management confirmed the strategy to leverage the platform for multiple brands, focusing on growing rag & bone and the newly launched Guess Jeans brand [99][107]