The strength of the U.S. dollar ended an earnings streak by Guess in Q4 2016. According to the Nasdaq news service, before this last quarter, the company had reported consisted revenue growth over the past few quarters, supported by strength in the brand’s e-commerce business.
In Q4, Guess recorded total net revenue decreased 5.5 percent to $658.3 million, from $696.7 million in the prior-year quarter. Net earnings were down 11.4 percent to $47.8 million.
The earnings-per-share for Q4 were $0.57 per share, missing Reuters’ estimates of $0.58 per share. This number was a 9.5 percent decrease from $0.63 for the fourth quarter of 2015.
The company took its hardest hit with its Asia business, where revenues decreased 18 percent in U.S. dollars. The Americas wholesale business also significantly went down, decreasing 9 percent in U.S. dollars.
Results for the fiscal year ended Jan. 30, 2016 showed a decrease in net earnings of 13.4 percent to $81.9 million from $94.6 million for the prior year. Diluted earnings per share decreased 13.5 percent to $0.96 in fiscal year 2016.
CEO Victor Herrero took a positive outlook on these results, citing positive retail results in Europe and the Americas in constant currency.
Herrero said, “There is still more work to be done, but I am convinced that the initiatives we have started to implement in the last few months have contributed to these encouraging results.”
The company’s strategic initiatives say that in the next three years, it will reach annual revenues of $3.0 billion, an $800 million increase, driven by growth in e-commerce, retail expansion and positive comp store sales. Guess is expecting increases in equal increases from the Americas and Europe of $300 million, and $200 million from Asia.