Canada Goose Holdings reports $9.1 million Q4 loss, revenue up from year ago

Canada Goose Holdings Inc. recorded lower sales in Asia in its latest quarter amid renewed COVID-19 restrictions and widespread store closures in China.

The luxury outdoor clothing company said sales in the Asia Pacific region were $70.6 million for the quarter ended April 3 compared with $77.7 million a year earlier. 

Sales in Canada, the United States and Europe all increased, bringing total revenue for what was the fourth quarter of its 2022 financial year to $223.1 million, up from $208.8 million in the same quarter last year.

“From a geographic perspective, our retail performance in North America was the biggest driver of growth,” Dani Reiss, chairman and CEO of Canada Goose, said Thursday during a conference call. 

“Consumer confidence remains strong, and shoppers have returned to pre-pandemic trends.” 

His comments came as the company reported a net loss of $9.1 million in its latest quarter compared with a profit of $2.5 million a year earlier. The loss amounted to nine cents per diluted share, compared with a profit of two cents per diluted share a year ago. 

Looking forward, Reiss said Canada Goose is ready with the inventory needed for when demand fully rebounds. 

“Many peers have pointed to continued production and supply chain challenges as well as logistical delays,” he said. “This was not a factor for us in the quarter, nor do we expect it to affect the year ahead.

“We continue to be uniquely insulated against supply chain issues due to our Canadian manufacturing, which accounted for 84 per cent of our total units in calendar 2021.” 

Still, Canada Goose has confronted higher freight costs.

“We continue to anticipate and monitor escalating costs based both on freight constraints and required speed to stage inventory or deliver to consumers,” the company said in its Management’s Discussion and Analysis.

On an adjusted basis, Canada Goose said it earned four cents per diluted share for its most recent quarter compared with an adjusted profit of a penny per diluted share a year ago.

Canada Goose was expected to report an adjusted loss of one cent per share on $222.7 million of revenue, according to financial data firm Refinitiv.

For the full year, its net profit increased 35 per cent to $94.6 million as revenues rose 21.5 per cent to nearly $1.1 billion.

In its outlook for the first quarter of its 2023 financial year, the company said it expects $60 million to $65 million in revenue and an adjusted loss between 60 and 64 cents per diluted share.

Canada Goose said its outlook for its full 2023 financial year sees total revenue between $1.3 billion and $1.4 billion, and an adjusted profit between $1.60 and $1.90 per diluted share.

Still, the company said COVID-19 restrictions may continue to weigh on ongoing demand improvement.

Canada Goose said the potential emergence of a new variant could negatively impact operations, including through temporary closures of retail stores and manufacturing facilities and supply chain disruptions.

On the Toronto Stock Exchange, its shares climbed $2.37 or 9.7 per cent at $26.91 in midday trading.

This report by The Canadian Press was first published May 19, 2022.

Companies in this story: (TSX:GOOS)

Brett Bundale, The Canadian Press