Canada Goose, citing slowing momentum in the North American market and worse than anticipated pandemic-related disruptions in China, has dropped its annual revenue guidance by 2 to 8 percent to a range of C$1.175 to C$1.195 billion (€807m to €820m) from a prior outlook of C$1.2 to C$1.3 billion. The revised position includes C$45 to $50 million in revenues from its joint venture in Japan versus prior guidance of C$60 to C$65 million, 6 percent wholesale revenue growth and direct-to-consumer sales equaling a “high 60s” percentage of total revenues against a prior outlook of 70 to 73 percent of all revenues.
Group operating income slipped by 5.3 percent to C$194.3 million (€140.4m) from C$205.0 million in the third quarter that ended Jan. 1, because of currency exchange impacts, investments in information technology, and higher costs for opening and operating stores. Net income was down by 10.9 percent to C$134.9 million (€97.5m) from C$151.3 million, but the gross margin improved to 72.2 percent from 70.6 percent. Total inventory at period-end was up by 31 percent year-over-year to C$482.0 million (€348.2m) from C$368.1 million because of lower-than-forecast sales in the Asia-Pacific region and inventory planning.
Total Q2 revenues fell by 2.2 percent on a constant-currency basis (-1.6% reported) to C$576.7 million (€416.7m) from C$586.1 million. DTC revenues increased by 1.5 percent to C$450.2 million (€325.3m) thanks to continued retail expansion, with 51 doors opened versus 41 in the year-ago period. Over the same comparable trading weeks, total revenue and DTC sales rose by 2.5 percent and 4.6 percent, respectively.
Reported DTC comparable sales fell by 6.0 percent, with all geographies positive except for mainland China. Because of earlier shipments in Q2, wholesale revenues declined by 17.3 percent to C$114.4 million (€82.7m) during the period.
Regionally, EMEA sales declined by 8.4 percent on a reported basis (-7.3% in constant currency) to C$117.1 million (€84.6m) and fell by 5.2 percent in the Asia-Pacific region to C$167.6 million (€121.1m) but rose by 11.3 percent in the U.S. to C$182.8 million (€132.1m) on higher revenues from existing stores and via continued retail expansion. Period sales in the group’s home market fell by 6.8 percent on a reported basis to C$109.2 million (€78.9m).
