Canada Goose says lower store traffic and a 7.5% drop in comparable sales contributed to a $26.3 million net loss in its most recent quarter.
The Story
Canada Goose Holdings Inc. reported a net loss of $26.3 million in its second quarter, compared with a loss of $17.4 million a year earlier.
The company attributed pressure in the quarter to a 7.5 per cent decline in comparable sales, linked to its direct-to-consumer business, alongside lower store traffic and sales in some markets.
For the quarter ended Sept. 27, the loss was 27 cents per diluted share, down from 16 cents per diluted share a year ago. On an adjusted basis, the company recorded a loss of 20 cents per diluted share, compared with an adjusted loss of 14 cents per diluted share the previous year.
Canada Goose said revenue totalled $274 million, up from $258.8 million in the same quarter last year. Direct-to-consumer revenue rose to $129.6 million from $126.2 million, while wholesale revenue increased to $128.2 million from $122.6 million. Other revenue climbed to $16.2 million from $10 million.
In remarks on a conference call, chief executive Dani Reiss said his “first priority moving forward is to deepen brand desire and turn it into more consistent demand.”
Chief financial officer Neil Bowden said the company’s gross margins were a highlight of the quarter, helped by production efficiencies, higher pricing, and favourable freight and duty costs. He also said a wave of new tariffs in the Canada-U.S. dispute had an “immaterial” effect on the company, according to his comments.
Canada Goose also noted that it excluded its Baffin business from its current year and prior-year results for easier comparisons. The company sold Baffin over the summer to L.P. Royer of Sherbrooke, Que., after buying the bootmaker in 2018 for $32.5 million. Bowden said the company decided to divest Baffin to focus resources on its “highest strategic priorities.”
← More stories