Guess, the renowned American retail stalwart, has had an extremely disappointing first quarter and does not expect it to be better in second quarter too.
The Q1 report highlighted that ever since the stores reopened, sales productivity has been around 75 per cent in US and Canada, and 70 per cent in Europe compared to what it was last year.
The net revenue for Q1 fell by 51.5 per cent to record US $ 260.3 million from US $ 536.7 million during the same period last year. That’s a big fall!
While retail revenue in US slumped by whopping 57.7 per cent in Q1, the same in Europe and Asia fell by 49.3 per cent and 52.6 per cent, respectively. The licensing revenue also dipped by 31.3 per cent during the quarter.
The retailer, reportedly, said shoppers are still reluctant to visit stores despite the lockdown being eased as there is so much uncertainty about the pandemic. Therefore, it believes Q2 is going to be no different either.
During the period, Guess also took measures to reduce the impact of the pandemic by furloughing several of its US and Canada store and corporate associates in addition to implementing temporary tiered salary reductions for management-level corporate employees.
Add to it, Guess has also been executing significant reductions in occupancy costs and capital expenditures, which has helped it to combat the crisis.
The brand’s e-commerce sites will, however, continue to operate.
Guess is hopeful that it will be on track despite poor Q1 and substantiating further Carlos Alberini, CEO, Guess, said “We are encouraged by our initial results, which have been better than anticipated. We continue to remain focused on enhancing our omnichannel platform centred around the consumer and are accelerating our efforts to gain efficiencies across our global operations and rationalise our store portfolios.”
Besides apparels for men and women, Guess also markets fashion accessories like shoes, watches and perfumes. The brand with 484 locations in more than 80 countries generates revenue of US $ 2.4 billion.