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Guess Q4 profit down, appoints Dennis Secor as interim CFO

By Prachi Singh

Mar 17, 2022

Management

Image: Guess, Facebook

For the fourth quarter of fiscal 2022, Guess recorded GAAP net earnings of 68.4 million dollars, a 14.1 percent decrease from the fourth quarter of fiscal 2020. GAAP diluted EPS decreased 11.9 percent to 1.04 dollars for the quarter.

The company’s adjusted net earnings were 75.2 million dollars, an 8.7 percent decrease compared to the fourth quarter of fiscal 2020, while adjusted diluted EPS decreased 6.6 percent to 1.14 dollars.

Total net revenue decreased 5 percent to 799.9 million dollars, while in constant currency, net revenue decreased by 5 percent.

Guess also announced that Dennis Secor has been appointed interim chief financial officer effective April 1, 2022. Secor previously served as Guess CFO from 2006 to 2012 and succeeds Katie Anderson, who is stepping down to pursue another opportunity at a privately-held company as CFO.

Commenting on the results and CFO transition, Carlos Alberini, the company’s chief executive officer, said: “We delivered revenues in line with our expectations and exceeded our profit targets through strong gross margin performance and effective expense management. We closed the year with over 300 million dollars in earnings from operations and reached an operating margin of 11.8 percent, more than double our pre-pandemic levels by both measures.”

“Katie has played an important role in our ongoing business transformation, including strengthening our balance sheet, implementing cost savings measures and delivering for our shareholders. We’re pleased to welcome Dennis back to Guess. Given his deep knowledge of Guess and its business, as well as his extensive industry experience, Dennis is uniquely positioned to build on our financial momentum and support the continued advancement of our strategy,” Alberini added.

Guess earnings drop 2.8 percent against Q42021

For the fourth quarter of fiscal 2022, the company recorded GAAP net earnings of 68.4 million dollars, a 2.8 percent decrease from the fourth quarter of fiscal 2021. GAAP diluted EPS decreased 2.8 percent to 1.04 dollars.

The company’s adjusted net earnings were 75.2 million dollars, a 3.2 percent decrease compared to the fourth quarter of fiscal 2021, while adjusted diluted EPS decreased 3.4 percent to 1.14 dollars.

Total net revenue increased 23.4 percent to 799.9 million dollars and in constant currency, net revenue increased by 28.1 percent.

Guess FY22 results compared to FY21 and FY20

For the fiscal year ended January 29, 2022, the company recorded GAAP net earnings of 171.4 million dollars, a 78.5 percent increase from the fiscal year ended February 1, 2020 and compared to a GAAP net loss of 81.2 million dollars for the fiscal year ended January 30, 2021. GAAP diluted EPS increased 93.2 percent to 2.57 dollars, and compared to GAAP diluted loss per share of 1.27 dollars for fiscal 2021.

The company recorded adjusted net earnings of 194.7 million dollars, an 85.4 percent increase compared to fiscal 2020 and compared to an adjusted net loss of 4.5 million dollars for fiscal 2021, while adjusted diluted EPS increased 101.4 percent to 2.92 dollars.

Total net revenue for the year decreased 3.2 percent to 2.59 billion dollars from fiscal 2020 and increased 38.1 percent compared to fiscal 2021. In constant currency, net revenue increased by 37 percent in 2021 and decreased by 4.9 percent compared to fiscal 2020.

Guess expects FY23 revenues to be up low-single digits

The company expects revenues in the first quarter of fiscal 2023 to be up in the low-teens versus the first quarter of fiscal 2022 mainly driven by last year’s temporary store closures, wholesale growth and positive store comps.

For the full fiscal year 2023, assuming no Covid-related shutdowns, Guess expects revenues to be up in the low-single digits versus fiscal 2022 and operating margin to reach approximately 10.5 percent. The company said, outlook for the first quarter and the year reflects significant disruptions in Russia.

The company’s board of directors approved a quarterly cash dividend of 225 cents per share payable on April 15, 2022 to shareholders of record as of the close of business on March 30, 2022.

Dennis Secor
GUESS