Guess Inc. (NYSE: GES) reported better-than-expected same-store sales on Wednesday, pushing the stock price up more than 20 perc ent in the early trading.
The apparel and accessories company said that sales slipped 0.2 percent to $545 million in the second quarter, slightly below analysts’ estimate of $550.5 million. Sales at stores open at least a year fell 2.5 percent, which is better than analysts’ projection of 4.2 percent decline.
Net income for the quarter ended July 30 was $32.3 million, or 38 cents per share, up from $18.3 million, or 21 cents a share, a year earlier. Adjusted earnings were $0.14 per share, beating analyst projection of $0.07 per share.
Shares jumped more than 20 percent in the early trading. The stock had dropped 21 percent this year.
The better-than-expected results shows that the company’s restructuring plan begin to pay off.Chief Executive Victor Herrero said that the first six months of this year would be a transition period and the company worked to cut costs.
“This transition is now behind us,” he said Wednesday, “and the investments we have made so far are expected to start generating revenue growth...in the third quarter, accelerating into the fourth quarter.”
Mr. Herrero continued, "I had highlighted on our prior earnings calls that the first six months of the year would be a transition period. This transition is now behind us and the investments we have made so far are expected to start generating revenue growth for the Company in the third quarter, accelerating into the fourth quarter."