1-11893 | 95-3679695 |
(Commission File Number) | (IRS Employer Identification No.) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: | |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
99.1 | Press Release of Guess?, Inc. dated June 2, 2015 (financial results for the quarter ended May 2, 2015) |
Dated: June 2, 2015 | GUESS?, INC. | |
By: | /s/ Sandeep Reddy | |
Sandeep Reddy Chief Financial Officer |
Exhibit No. | Description | |
99.1 | Press Release of Guess?, Inc. dated June 2, 2015 (financial results for the quarter ended May 2, 2015) |
Exhibit 99.1 |
• | North American Retail revenues decreased 6%; retail comp sales including e-commerce decreased 6% in U.S. dollars and 4% in constant currency |
• | European revenues decreased 14% in U.S. dollars and increased 8% in constant currency |
• | Asian revenues decreased 9% in U.S. dollars and 6% in constant currency |
• | North American Wholesale revenues decreased 5% in U.S. dollars and increased 1% in constant currency |
• | Earnings from operations of $4 million in Q1 fiscal 2016; compared to loss from operations of $2 million in Q1 fiscal 2015 |
• | The Company’s retail stores and e-commerce sites in North America generated revenue of $214.2 million in the first quarter of fiscal 2016, a 6.2% decrease from $228.3 million in the same period a year ago. Comparable store sales including the results of our e-commerce sites for the first quarter of fiscal 2016 decreased 5.9% in U.S. dollars and 3.8% in constant currency compared to the same period a year ago. |
• | Net revenue from the Company’s Europe segment decreased 13.7% to $137.4 million in the first quarter of fiscal 2016, from $159.2 million in the prior-year period. In constant currency, net revenue increased 7.5%. |
• | Net revenue from the Company’s Asia segment decreased 8.7% to $64.0 million in the first quarter of fiscal 2016, from $70.1 million in the prior-year period. In constant currency, net revenue decreased 6.0%. |
• | Net revenue from the Company’s North American Wholesale segment decreased 5.2% to $37.3 million in the first quarter of fiscal 2016, from $39.3 million in the prior-year period. In constant currency, net revenue increased 1.4%. |
• | Licensing segment net revenue increased 1.0% to $25.9 million in the first quarter of fiscal 2016, from $25.6 million in the prior-year period. |
• | Consolidated net revenues are expected to decline between 3.5% and 1.5% in constant currency. Currency headwinds are expected to negatively impact consolidated revenue growth by approximately 9.5%, for a net decline between 13.0% and 11.0%. |
• | Operating margin is expected to be between 3.0% and 4.0% and includes 170 basis points of currency headwind. |
• | Diluted earnings per share are expected to be in the range of $0.12 to $0.16. The estimated impact on earnings per share of the currency headwinds is roughly $0.12. |
• | Consolidated net revenues are expected to range between a decline of 1.5% and an increase of 0.5% in constant currency. Currency headwinds are expected to negatively impact consolidated revenue growth by approximately 7%, for a net decline between 8.5% and 6.5%. |
• | Operating margin is expected to be between 5.0% and 6.0% and includes 130 basis points of currency headwind. |
• | Diluted earnings per share are expected to be in the range of $0.86 to $1.02. The estimated impact on earnings per share of the currency headwinds is roughly $0.45. |
Contact: | Guess?, Inc. | |
Fabrice Benarouche | ||
VP, Finance and Investor Relations | ||
(213) 765-5578 | ||
Source: | Guess?, Inc. | |
Guess?, Inc. and Subsidiaries | |||||||||||||||
Condensed Consolidated Statements of Income (Loss) | |||||||||||||||
(amounts in thousands, except per share data) | |||||||||||||||
Three Months Ended | |||||||||||||||
May 2, 2015 | May 3, 2014 | ||||||||||||||
$ | % | $ | % | ||||||||||||
Product sales | $ | 452,959 | 94.6 | % | $ | 496,928 | 95.1 | % | |||||||
Net royalties | 25,865 | 5.4 | % | 25,613 | 4.9 | % | |||||||||
Net revenue | 478,824 | 100.0 | % | 522,541 | 100.0 | % | |||||||||
Cost of product sales | 313,339 | 65.4 | % | 346,310 | 66.3 | % | |||||||||
Gross profit | 165,485 | 34.6 | % | 176,231 | 33.7 | % | |||||||||
Selling, general and administrative expenses | 161,132 | 33.7 | % | 178,208 | 34.1 | % | |||||||||
Earnings (loss) from operations | 4,353 | 0.9 | % | (1,977 | ) | (0.4 | %) | ||||||||
Other income (expense): | |||||||||||||||
Interest expense | (435 | ) | (0.1 | %) | (525 | ) | (0.1 | %) | |||||||
Interest income | 272 | 0.1 | % | 405 | 0.1 | % | |||||||||
Other, net | 2,626 | 0.5 | % | (1,119 | ) | (0.2 | %) | ||||||||
Earnings (loss) before income tax expense (benefit) | 6,816 | 1.4 | % | (3,216 | ) | (0.6 | %) | ||||||||
Income tax expense (benefit) | 2,829 | 0.6 | % | (1,029 | ) | (0.2 | %) | ||||||||
Net earnings (loss) | 3,987 | 0.8 | % | (2,187 | ) | (0.4 | %) | ||||||||
Net earnings (loss) attributable to noncontrolling interests | 646 | 0.1 | % | (86 | ) | (0.0 | %) | ||||||||
Net earnings (loss) attributable to Guess?, Inc. | $ | 3,341 | 0.7 | % | $ | (2,101 | ) | (0.4 | %) | ||||||
Net earnings (loss) per common share attributable to common stockholders: | |||||||||||||||
Basic | $ | 0.04 | $ | (0.03 | ) | ||||||||||
Diluted | $ | 0.04 | $ | (0.03 | ) | ||||||||||
Weighted average common shares outstanding attributable to common stockholders: | |||||||||||||||
Basic | 84,965 | 84,499 | |||||||||||||
Diluted | 85,099 | 84,499 | |||||||||||||
Guess?, Inc. and Subsidiaries | ||||||||||||||
Consolidated Segment Data | ||||||||||||||
(dollars in thousands) | ||||||||||||||
Three Months Ended | ||||||||||||||
May 2, | May 3, | % | ||||||||||||
2015 | 2014 | change | ||||||||||||
Net revenue: | ||||||||||||||
North American Retail | $ | 214,249 | $ | 228,344 | (6%) | |||||||||
Europe | 137,397 | 159,158 | (14%) | |||||||||||
Asia | 64,035 | 70,118 | (9%) | |||||||||||
North American Wholesale | 37,278 | 39,308 | (5%) | |||||||||||
Licensing | 25,865 | 25,613 | 1% | |||||||||||
$ | 478,824 | $ | 522,541 | (8%) | ||||||||||
Earnings (loss) from operations: | ||||||||||||||
North American Retail | $ | (7,209 | ) | $ | (8,399 | ) | 14% | |||||||
Europe | (3,668 | ) | (6,632 | ) | 45% | |||||||||
Asia | 4,613 | 3,353 | 38% | |||||||||||
North American Wholesale | 6,747 | 7,753 | (13%) | |||||||||||
Licensing | 23,025 | 22,721 | 1% | |||||||||||
Corporate Overhead | (19,155 | ) | (20,773 | ) | (8%) | |||||||||
$ | 4,353 | $ | (1,977 | ) | 320% | |||||||||
Operating margins: | ||||||||||||||
North American Retail | (3.4 | %) | (3.7 | %) | ||||||||||
Europe | (2.7 | %) | (4.2 | %) | ||||||||||
Asia | 7.2 | % | 4.8 | % | ||||||||||
North American Wholesale | 18.1 | % | 19.7 | % | ||||||||||
Licensing | 89.0 | % | 88.7 | % | ||||||||||
Total Company | 0.9 | % | (0.4 | %) | ||||||||||
Guess?, Inc. and Subsidiaries | ||||||||||||||||||||||||
Constant Currency Financial Measures | ||||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||
May 2, 2015 | May 3, 2014 | % change | ||||||||||||||||||||||
As Reported | Foreign Currency Impact | Constant Currency | As Reported | As Reported | Constant Currency | |||||||||||||||||||
Net revenue: | ||||||||||||||||||||||||
North American Retail | $ | 214,249 | $ | 5,361 | $ | 219,610 | $ | 228,344 | (6%) | (4%) | ||||||||||||||
Europe | 137,397 | 33,749 | 171,146 | 159,158 | (14%) | 8% | ||||||||||||||||||
Asia | 64,035 | 1,885 | 65,920 | 70,118 | (9%) | (6%) | ||||||||||||||||||
North American Wholesale | 37,278 | 2,573 | 39,851 | 39,308 | (5%) | 1% | ||||||||||||||||||
Licensing | 25,865 | — | 25,865 | 25,613 | 1% | 1% | ||||||||||||||||||
$ | 478,824 | $ | 43,568 | $ | 522,392 | $ | 522,541 | (8%) | (0%) | |||||||||||||||
Guess?, Inc. and Subsidiaries | ||||||||||||||||||
Selected Condensed Consolidated Balance Sheet Data | ||||||||||||||||||
(in thousands) | ||||||||||||||||||
May 2, | January 31, | May 3, | ||||||||||||||||
2015 | 2015 | 2014 | ||||||||||||||||
ASSETS | ||||||||||||||||||
Cash and cash equivalents | $ | 459,128 | $ | 483,483 | $ | 472,463 | ||||||||||||
Short-term investments | — | — | 5,075 | |||||||||||||||
Receivables, net | 195,741 | 216,205 | 217,541 | |||||||||||||||
Inventories | 327,101 | 319,078 | 373,423 | |||||||||||||||
Other current assets | 91,128 | 92,593 | 89,342 | |||||||||||||||
Property and equipment, net | 249,784 | 259,524 | 322,936 | |||||||||||||||
Other assets | 232,357 | 230,522 | 232,971 | |||||||||||||||
Total Assets | $ | 1,555,239 | $ | 1,601,405 | $ | 1,713,751 | ||||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||||||
Current portion of capital lease obligations and borrowings | $ | 5,313 | $ | 1,548 | $ | 1,829 | ||||||||||||
Other current liabilities | 279,231 | 300,418 | 318,021 | |||||||||||||||
Long-term debt and capital lease obligations | 2,335 | 6,165 | 6,912 | |||||||||||||||
Other long-term liabilities | 193,705 | 199,391 | 207,647 | |||||||||||||||
Redeemable and nonredeemable noncontrolling interests | 16,104 | 20,027 | 21,594 | |||||||||||||||
Guess?, Inc. stockholders’ equity | 1,058,551 | 1,073,856 | 1,157,748 | |||||||||||||||
Total Liabilities and Stockholders’ Equity | $ | 1,555,239 | $ | 1,601,405 | $ | 1,713,751 |
Guess?, Inc. and Subsidiaries | ||||||||||||||
Condensed Consolidated Cash Flow Data | ||||||||||||||
(in thousands) | ||||||||||||||
Three Months Ended | ||||||||||||||
May 2, | May 3, | |||||||||||||
2015 | 2014 | |||||||||||||
Net cash provided by (used in) operating activities | $ | 9,135 | $ | (233 | ) | |||||||||
Net cash used in investing activities | (10,535 | ) | (17,106 | ) | ||||||||||
Net cash used in financing activities | (22,924 | ) | (22,118 | ) | ||||||||||
Effect of exchange rates on cash and cash equivalents | (31 | ) | 8,975 | |||||||||||
Net change in cash and cash equivalents | (24,355 | ) | (30,482 | ) | ||||||||||
Cash and cash equivalents at the beginning of the year | 483,483 | 502,945 | ||||||||||||
Cash and cash equivalents at the end of the period | $ | 459,128 | $ | 472,463 | ||||||||||
Supplemental information: | ||||||||||||||
Depreciation and amortization | $ | 18,330 | $ | 21,396 | ||||||||||
Rent | $ | 64,715 | $ | 71,068 |
Guess?, Inc. and Subsidiaries | ||||||||||||||
Reconciliation of Net Cash Provided by (Used in) Operating Activities to Free Cash Flow | ||||||||||||||
(in thousands) | ||||||||||||||
Three Months Ended | ||||||||||||||
May 2, | May 3, | |||||||||||||
2015 | 2014 | |||||||||||||
Net cash provided by (used in) operating activities | $ | 9,135 | $ | (233 | ) | |||||||||
Less: Purchases of property and equipment | (11,604 | ) | (17,254 | ) | ||||||||||
Free cash flow | $ | (2,469 | ) | $ | (17,487 | ) | ||||||||
Guess?, Inc. and Subsidiaries | ||||||||||
Retail Store Data | ||||||||||
International Store Count | ||||||||||
As of May 2, 2015 | As of May 3, 2014 | |||||||||
Total | Directly Operated | Total | Directly Operated | |||||||
Region | Stores | Stores | Stores | Stores | ||||||
United States and Canada | 470 | 470 | 491 | 491 | ||||||
Europe and the Middle East | 605 | 267 | 623 | 264 | ||||||
Asia | 499 | 52 | 497 | 49 | ||||||
Central and South America | 93 | 42 | 86 | 37 | ||||||
1,667 | 831 | 1,697 | 841 | |||||||
Guess?, Inc. and Subsidiaries | ||||||||||
Retail Store Data | ||||||||||
U.S. and Canada | ||||||||||
Three Months Ended | ||||||||||
May 2, | May 3, | |||||||||
2015 | 2014 | |||||||||
Number of stores at the beginning of the year | 481 | 494 | ||||||||
Store openings | — | 1 | ||||||||
Store closures | (11) | (4) | ||||||||
Number of stores at the end of the period | 470 | 491 | ||||||||
Total store square footage at the end of the period | 2,251,000 | 2,320,000 |
Guess?, Inc. and Subsidiaries | ||||||||||
North American Retail Net Revenue | ||||||||||
(dollars in thousands) | ||||||||||
Three Months Ended | ||||||||||
May 2, | May 3, | % | ||||||||
2015 | 2014 | change | ||||||||
Net revenue: | ||||||||||
Retail stores | $ | 196,037 | $ | 212,347 | (7.7 | %) | ||||
E-commerce sites | 18,212 | 15,997 | 13.8 | % | ||||||
Total | $ | 214,249 | $ | 228,344 | (6.2 | %) | ||||
Guess?, Inc. and Subsidiaries | |||
Retail Store Change in Comparable Store Sales | |||
U.S. and Canada | |||
Three Months Ended | |||
May 2, 2015 | |||
U.S. Dollars | Constant Currency | ||
Excluding e-commerce sales | (7.5%) | (5.4%) | |
Impact of e-commerce sales | 1.6% | 1.6% | |
Including e-commerce sales | (5.9%) | (3.8%) |