Earning Plays

[3xBuBu]

Guess 1Q profit rises on European, Asian sales
Apparel designer and retailer Guess Inc. said Tuesday its fiscal 2009 first-quarter profit jumped 35 percent, beating Wall Street expectations, on strong growth and better margins in Europe and Asia.

For the quarter ended May 3, the company earned $47.8 million, or 51 cents per share, compared with $35.5 million, or 38 cents per share, during the same period a year earlier. Revenue rose 29 percent to $489.2 million from $377.9 million.

Analysts polled by Thomson Financial expected profit of 46 cents per share on revenue of $453.6 million.

North American sales rose 18 percent to $211.9 million during the quarter. Meanwhile, North American same-store sales during the first quarter rose 7 percent. Same-store sales, or sales at stores open at least a year, is a key indicator of retailer performance because it measures growth at existing stores rather than newly opened ones.

At the end of the first quarter, Guess had 391 stores in the U.S. and Canada, compared with 336 a year earlier.

In Europe, sales rose 50 percent to $178.7 million, while sales climbed 27 percent to $75.1 million in Asia. Revenue from licensing rose 16 percent to $23.5 million.

Overall operating margins, meanwhile, rose 31 percent on a mix of favorable currency exchange rates and overall improvements in European margins and a boost in European sales.

"The strength of our brand was evident across all of our businesses, with each of our segments delivering double-digit revenue growth and all contributing to our earnings increase," Chief Executive Paul Marciano said in a statement.

Guess shares rose $2.62, or 6.9 percent, to $40.49 in after-hours trading after falling $1, or 2.6 percent, to close at $37.66 during the regular trading session.