Guess’s Q2 FY 2017 Results Show That The Company Has Started Recovering With The Implementation Of Its Revamped Strategies
Guess’s Q2 FY2017 results were released on August 24th. The company is progressing well with the strategic initiatives proposed by its CEO, Victor Herrero. It displayed marked recovery in its performance over its previous quarter. As was discussed by its management, the first half of 2016 was a transitioning phase for Guess, and it expects to reap the benefits of its investments starting from Q3 FY2017 which will further accelerate in the fourth quarter. We believe Guess is well on its way to further improvement in performance with the implementation of its growth plans.
- Guess’s recovery strategies proposed by its CEO, Victor Herrero, seem to be progressing well.
- The sales and merchandising operation had become tighter with knowledge passed seamlessly from the stores to its designers, merchants, and sourcing teams in a virtual cycle. The improved product assortment had already led to significant sales recovery in Europe.
- Guess’s focus on Asia had resulted in greater investments in infrastructure. The company is on track in opening of 65 new directly operated stores in Asia by the end of 2016, with the majority being in Greater China. It has already opened 16 new stores in the second quarter.
- The culture of accountability has resulted in daily, weekly, and monthly reviews of performances throughout the organization.
- Its cost saving initiatives are on track with an expected $25 million annualized savings to be accrued by the end of this year.
- The wholesale division is being transformed to follow the same principles that govern the retail business. This resulted in Europe, Guess’s largest wholesale market, to revive its growth, which is expected to continue over the rest of the year.
Guidance For Full Fiscal 2017:
- Net revenues are expected to grow between 3.0% to 5.0% year-on-year.
- The GAAP operating margin is expected to remain within 3.5% and 4.5%.
- The GAAP diluted earnings per share are expected to be around $0.79 to $0.92.
Have more questions about Guess? See the links below.
- What Is Guess’s Revenue And EBITDA Breakdown?
- How Has Guess’s Revenue And EBITDA Composition Changed Over 2012-2016E?
- Guess Q4 FY2016 Pre-Earnings Report
- What Led To Guess’ Revenue And EBITDA Decline Over The Last Five Years?
- Guess: Fiscal Year 2016 In Review
- How Did Guess’s Stock Perform Vis-A-Vis Its Peers Over The Last 5 Years ?
- What Is Guess’ Fundamental Value Based On 2016 Estimated Numbers?
- How Did Guess’ Different Segments Perform Over The Last 5 Years?
- Guess Q1 FY 2017 Earnings Preview
- Key Takeaways From Guess’s Q1 FY 2017 Earnings
- Guess’s Expected Revenue And EBITDA For 2016: Trefis Estimate
- Is The Guess Stock Price Driven By Current Earnings Or By Market Sentiments?
- How Do We Expect Guess’s North American Retail Business To Grow Over The Next 5 Years?
- How Is Guess’s Revenue Composition Expected To Trend?
- How Fast Is Guess’s Asia Operation Expected To Grow Over The Next Five Years?
- Guess’s Q2 FY2017 Earnings Preview
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