Canada Goose’s stock plummets on mixed Q4 results

Canada Goose Holdings Inc. (NYSE: GOOS) topped earnings estimates for the fourth quarter of 2019 while revenues came in shy of forecasts, sending the stock crashing over 13% during premarket hours on Wednesday.

Total revenue grew 25.2% year-over-year to CAD156.2 million, but missed the consensus estimate of CAD158 million. On a constant currency basis, revenues grew 23.2%.  

On a reported basis, net income was CAD9 million, or CAD0.08 per share, compared to CAD8.1 million, or CAD0.07 per share, in the prior-year quarter. Adjusted net income was CAD10 million or CAD0.09 per share, ahead of the forecast for EPS of CAD0.05.  

During the quarter, wholesale revenues grew 12.7% to CAD33.8 million from the prior-year period, helped by higher order values. DTC revenues increased 29.1% to CAD122.4 million, aided by strength in established ecommerce markets and retail stores. On a constant currency basis, wholesale revenues rose 9.7% and DTC revenues grew 27.5%.  

For fiscal 2020, Canada Goose expects annual revenue growth of at least 20% along with annual growth in adjusted EPS of at least 25%. Wholesale revenue growth is expected in the high single digits on a percentage basis. The company also expects to have eight new retail stores in operation by the end of the winter selling season.

Over the next three fiscal years, Canada Goose expects average annual revenue growth of at least 20% and average annual growth in adjusted EPS of at least 25%.

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