Financial Data and Key Metrics Changes - In Q4, revenues increased by 5% to $932 million, with an adjusted growth of 14% when accounting for currency and last year's extra week [12][53] - For the full year, revenues grew by 8% in U.S. dollars to $3 billion, and by 10% in constant currency [21] - Adjusted earnings per share (EPS) for Q4 was $1.48, down from $2.01 in the previous year [66] Business Line Data and Key Metrics Changes - The Rag & Bone acquisition contributed 9 points to the 14% growth, while the core guest business contributed 5 points [12] - The licensing business grew by 18% in Q4, driven by strong performance in footwear, fragrances, handbags, and eyewear [15][61] - The Americas retail business saw a 14% constant currency comp decline, while the European retail business had a 5% constant currency comp increase [15][56] Market Data and Key Metrics Changes - In Europe, revenues grew by 2% to $494 million, with a constant currency growth of 13% [53] - Asia revenues decreased by 15% to $70 million, with a constant currency decline of 4% [60] - The U.S. and Canadian stores experienced a 14% comp decline, while e-commerce in the region delivered an 8% increase in constant currency [55][56] Company Strategy and Development Direction - The company aims to strengthen brand awareness and customer engagement, improve retail store and e-commerce productivity, and optimize its business model for better profitability [22][51] - Plans include opening new stores for Rag & Bone and Guess Jeans, with a focus on expanding in Europe and Asia [92][128] - The company is exploring the integration of its infrastructures across different regions to improve cost structure and profitability [35][36] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges such as inflationary pressures, the Red Sea crisis, and traffic declines in retail stores [10][70] - Despite these challenges, the company expects revenue growth in fiscal 2026 between 3.9% and 6.2%, with adjusted operating margins between 4.5% and 5.4% [47][79] - The company plans to address consumer price sensitivity by expanding entry price point offerings [32][105] Other Important Information - The company ended the quarter with $563 million in inventory, a 21% increase, primarily due to the Rag & Bone acquisition [66] - A new Chief Financial Officer, Alberto Toni, will join the company in June, bringing extensive experience [24] - The board approved a quarterly cash dividend of 30 cents per share [70] Q&A Session Summary Question: What are the drivers for Rag & Bone's growth? - Management expressed excitement about the Rag & Bone acquisition, highlighting strong e-commerce performance and plans for new store openings in Europe and North America [90][92] Question: What is the strategy for the Americas business? - Management discussed plans to improve retail productivity through exclusive product collections and a speed-to-market model to capitalize on current trends [100][102] Question: What is the opportunity for Guess Jeans? - Management noted strong initial performance in Europe and plans for expansion in the U.S. and Japan, with a focus on sustainability and appealing to younger customers [120][128]

Market Overview - The U.S. stock market experienced one of its worst trading days recently, with major indexes closing at session lows due to newly imposed tariffs on trading partners, leading to increased market uncertainty [1][2] - The Dow Jones Industrial Average fell by 1,679 points, a decrease of 3.98%, while the S&P 500 dropped 274 points, or 4.84%. The Nasdaq saw a significant loss of 1,050 points, down 5.97%, and the Russell 2000 fell by 134 points, a decline of 6.59% [2] Economic Indicators - The final S&P U.S. Services PMI for March was reported at 54.4, slightly above estimates and 10 basis points higher than the previous month. The ISM Services index remained above the 50% threshold at 50.8%, although it was lower than the expected 52.9% and the prior month's 53.5% [3][4] - Analysts anticipate a potential drop in the ISM Services index in the upcoming month, given its proximity to the 50-level [4] Company Performance - Specialty retailer Guess? reported fiscal Q4 earnings of $1.48 per share, exceeding Zacks consensus estimates by 7 cents, with revenues of $932 million surpassing the anticipated $899 million [5] - The company has adjusted its full-fiscal year guidance to reflect growth of 3.9%-6.2%, with EPS guidance revised to a range of $1.32-$1.76 per share, down from a previous expectation of $2.02 per share [6] - Despite an 11% sell-off prior to the earnings report, Guess? shares showed only a slight decline in late trading [6] Labor Market Expectations - The upcoming nonfarm payroll report is expected to show the addition of 135,000 to 140,000 jobs, with the unemployment rate remaining steady at 4.1% [7] - Wage growth is anticipated to remain stable both month-over-month and year-over-year, indicating a healthy labor market despite mild job losses reflected in weekly jobless claims [8]

Guess?, Inc. (GES) Q4 2025 Earnings Conference Call April 03, 2025 04:45 PM ET Company Participants Operator - Conference Call ModeratorOperator - Conference Call ModeratorCarlos Alberini - Chief Executive OfficerFabrice Bernouche - Senior Vice President of Finance, Investor Relations & Chief Accounting OfficerDenis Sikor - Interim Chief Financial Officer Conference Call Participants Mauricio Serna - Analyst, UBSEric Better - Analyst, Small Cap Consumer Research Operator Good day, everyone, and welcome to t ...

Revenue Performance - Revenues for Q4 FY 2025 increased to $932 million, up 5% in U.S. dollars and 9% in constant currency[2] - Full fiscal year 2025 revenues reached $3.0 billion, an 8% increase in U.S. dollars and a 10% increase in constant currency[20] - The Company's outlook for consolidated net revenue in fiscal 2026 is expected to increase between 3.9% and 6.2%[28] - Total net revenue for the three months ended February 1, 2025, was $932,252,000, representing a 5% increase from $891,050,000 in the prior year[57] - Total net revenue for the fiscal year ended February 1, 2025, reached $3,067,059 thousand, an 8% increase from $2,776,530 thousand in the previous fiscal year[60] Earnings and Profitability - GAAP EPS for Q4 FY 2025 was $1.16, a 32% decrease from $1.71 in the prior year[9] - Adjusted EPS for Q4 FY 2025 was $1.48, down 26% from $2.01 in the same prior-year quarter[10] - GAAP diluted EPS for fiscal 2026 is projected to be between $1.03 and $1.37, while adjusted diluted EPS is expected to range from $1.32 to $1.76[28] - Adjusted net earnings per diluted share for the three months ended February 1, 2025, were $1.48, compared to $2.01 for the same period last year[50] - Reported GAAP net earnings attributable to Guess?, Inc. for the three months ended February 1, 2025, were $81,399,000, a decrease of 29% compared to $115,270,000 for the same period last year[52] Operating Margins - GAAP operating margin for FY 2025 decreased to 5.8%, down from 9.5% in FY 2024[21] - The operating margin for the Company's Europe segment decreased by 2.1% to 9.5% in fiscal 2025, down from 11.6% in fiscal 2024, mainly due to higher expenses and unfavorable currency impacts[26] - The Americas Retail segment's operating margin fell by 7.0% to 1.0% in fiscal 2025, compared to 8.0% in fiscal 2024, driven by negative retail comparable sales and increased expenses[26] Expenses and Costs - Selling, general and administrative expenses increased to $1,134,643 thousand, representing 37.9% of net revenue for the fiscal year ended February 1, 2025, up from 34.4% in the previous year[49] - Adjusted selling, general and administrative expenses for the fiscal year ended February 1, 2025, were $1,121,044,000, up from $967,546,000 in the prior year, marking an increase of 15.8%[52] - Other expense, net for fiscal 2025 was $73.4 million, a significant increase from $5.1 million in fiscal 2024, primarily due to a net unrealized loss of $60.7 million related to derivatives[25] Cash Flow and Capital Management - The Company anticipates free cash flow of $55 million for fiscal 2026, with net cash provided by operating activities at $125 million[32] - Free cash flow for the fiscal year ended February 1, 2025, was $29,761 thousand, down from $248,422 thousand in the previous year[67] - The Company repurchased approximately 2.6 million shares for $60.3 million during fiscal 2025, leaving a capacity of $139.8 million under the share repurchase program[34] Store Operations and Acquisitions - The Company operates 1,070 retail stores directly and has partners operating an additional 527 stores worldwide as of February 1, 2025[41] - The company operated a total of 1,597 stores as of February 1, 2025, an increase from 1,553 stores as of February 3, 2024[69] - The acquisition of rag & bone contributed to revenue growth and was a significant milestone for the company[5] - The Company acquired all operating assets and a 50% interest in the intellectual property assets of rag & bone on April 2, 2024, enhancing its market presence[41] Tax and Other Financial Metrics - The effective income tax rate for the fiscal year ended February 1, 2025, was 12.0%, compared to 10.8% in the previous year[49] - The adjusted effective income tax rate for the fiscal year ended February 1, 2025, was 24.0%, compared to 22.2% in the previous year[52] - Total assets increased to $2,766,678 thousand as of February 1, 2025, from $2,590,021 thousand a year earlier[62] - Long-term debt and finance lease obligations rose to $150,668 thousand from $28,210 thousand year-over-year[62]

Core Viewpoint - Kaskela Law LLC has initiated an investigation into the fairness of the proposed buyout of Guess? Inc. by WHP Global, focusing on whether the buyout price adequately reflects the value of the company's shares [1][3]. Buyout Proposal Details - On March 17, 2025, Guess? announced a buyout proposal from WHP Global to acquire unaffiliated shareholders at a price of $13.00 per share [2]. - The proposed buyout price of $13.00 per share is significantly lower than Guess?'s 52-week high of over $33.00 per share and below analyst price targets exceeding $18.00 per share [3]. Investigation Purpose - The investigation aims to assess if the proposed buyout price is fair for unaffiliated Guess? shareholders and whether it represents sufficient monetary consideration for GES shares [3]. Shareholder Communication - Guess? shareholders are encouraged to contact Kaskela Law LLC for more information regarding the investigation and their legal rights [4].

Core Viewpoint - Guess?, Inc. is expected to report a decline in earnings for the fourth quarter of fiscal 2025, with a consensus estimate of $1.41 per share, reflecting a 29.9% decrease year-over-year [1]. Financial Performance - The consensus estimate for quarterly revenues is $899 million, indicating a 0.9% growth from the previous year [2]. - For fiscal 2025, the revenue consensus is projected at $2.96 billion, representing a 6.7% year-over-year increase [2]. - Adjusted earnings per share (EPS) for the fourth quarter is forecasted to be between $1.37 and $1.52, with an expected adjusted operating margin of 12.2% to 13% [5]. Market Conditions - The company is facing a challenging consumer environment influenced by changing purchasing behaviors, economic pressures, and regional disparities [3]. - Macroeconomic factors such as inflation and economic uncertainty are leading consumers to prioritize value-driven purchases, which is expected to negatively impact consumer sentiment and traffic, particularly in North America and Asia [3]. Operational Challenges - Rising freight costs are a significant challenge for Guess?, with an anticipated additional $5 million in freight-related expenses for the fourth quarter, which will further squeeze margins [4]. - Increased shipping charges and air freight usage are expected to particularly affect the European business, a key revenue contributor [4]. Strategic Positioning - Despite challenges, Guess? is strategically positioned with an expanding product portfolio, growing direct-to-consumer channels, and effective cost management [6]. - The company anticipates revenue growth in the range of 2.2% to 5.4% for the fourth quarter of fiscal 2025, supported by positive results from wholesale operations in Europe and the Americas [6]. Earnings Prediction - The current model does not predict an earnings beat for Guess?, as it holds a Zacks Rank of 4 (Sell) and an Earnings ESP of 0.00% [7].

Core Viewpoint - Guess (GES) is anticipated to report a year-over-year decline in earnings despite an increase in revenues for the quarter ending January 2025, with the actual results being crucial for its near-term stock price movement [1][2]. Earnings Expectations - The consensus estimate for Guess's quarterly earnings is $1.41 per share, reflecting a year-over-year decrease of 29.9%. Revenues are projected to be $926 million, which is a 3.9% increase from the previous year [3]. - The consensus EPS estimate has been revised down by 62.16% over the last 30 days, indicating a significant reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that the Most Accurate Estimate for Guess is the same as the Zacks Consensus Estimate, resulting in an Earnings ESP of 0%. This suggests no recent differing analyst views [10]. - The current Zacks Rank for Guess is 4 (Sell), complicating the prediction of an earnings beat [11]. Historical Performance - In the last reported quarter, Guess was expected to post earnings of $0.43 per share but only achieved $0.34, resulting in a surprise of -20.93%. Over the last four quarters, the company has beaten consensus EPS estimates twice [12][13]. Industry Comparison - PVH (PVH), another player in the Zacks Textile - Apparel industry, is expected to report earnings of $3.19 per share for the same quarter, indicating a year-over-year decline of 14.3%. Revenues are expected to be $2.34 billion, down 6.1% from the previous year [17]. - The consensus EPS estimate for PVH has been revised down by 4.5% over the last 30 days, with an Earnings ESP of -0.52% and a Zacks Rank of 4 (Sell), making it difficult to predict an earnings beat [18].

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Group 1 - Guess? Inc. (GES) is an American apparel retailer founded in 1981 and became publicly traded in 1996 [1] - The article discusses the share price performance of Guess? Inc. since its IPO [1] Group 2 - The analyst expresses a focus on investing at the intersection of value and growth, particularly in small-cap stocks [1] - The investment strategy includes looking for long-term compounders and special situations [1]

Group 1 - The article emphasizes the investment philosophy focused on small cap companies, highlighting the importance of identifying mispriced securities through understanding financial drivers and utilizing DCF model valuation [1] - The methodology allows for a flexible approach to investing, not confined to traditional categories such as value, dividend, or growth investing, but rather assessing all prospects of a stock to evaluate risk-to-reward [1] Group 2 - There is a potential interest in initiating a long position in GES within the next 72 hours, indicating a strategic move based on the analysis presented [2] - The article expresses personal opinions of the author without any compensation from companies mentioned, ensuring an unbiased perspective [2]