Guess Sees Nearly Flat Second-Quarter Revenues
Guess, the Los Angeles company known for its sexy clothes and even sexier ads, reported a slight decline in its second-quarter revenues for fiscal 2017 as tourist traffic to stores dipped in the United States.
Second-quarter revenues for the period ending July 30 were down 0.2 percent to $545 million from $546 million for the year-earlier period.
However, net income saw a big bump due to Guess selling a minority interest investment for approximately $22.3 million. Second-quarter net earnings totaled $32 million compared to $18.5 million for the same period last year.
The company’s retail stores, which span the globe, saw revenues in the Americas decline 3 percent in U.S. dollars while they were up 7 percent in Europe and down 6 percent in Asia.
On the wholesale side of business, revenues in the Americas slid 8 percent in U.S. dollars while licensing revenues were off 13 percent.
Guess has been in the middle of a transition to turn sales around at the 35-year-old company, founded by the Marciano brothers. Last year, Victor Herrero came on board as the new chief executive, replacing Paul Marciano, to improve the fiscal health of the company.
Herrero noted that the first six months of the year were a transformative period. “This transition is behind us and the investments we have made so far are expected to start generating revenue growth for the company in the third quarter, accelerating into the four quarter,” he said in an earnings call.