Canada Goose Stock Drops After Gloomy FY23 Outlook

Canada Goose Holdings Inc GOOS reported second-quarter FY23 sales growth of 19% year-on-year to CA$277.2 million.
DTC revenue grew 15.6% Y/Y, and Wholesale revenue increased 21.2%.
Gross profit rose 22.8% Y/Y to CA$165.8 million, with the margin expanding 180 basis points to 59.8%.
The operating margin contracted 370 basis points to 1.7%. The operating income for the quarter declined 62.7% to CA$4.7 million.
The company held CA$97.1 million in cash and equivalents as of October 2, 2022.
EPS for the quarter was CA$0.03 compared to CA$0.09 the previous year. Non-IFRS adjusted EPS was CA$0.22 versus CA$0.13 last year.
Inventory was CA$511.5 million as of Q2 ended October 2, 2022, compared to CA$416.4 million as of September 26, 2021.
"Given the extent of Covid disruptions in Mainland China as well as an uncertain global macroeconomic backdrop, we have revised our fiscal 2023 outlook," said Dani Reiss, Chairman and CEO.
Outlook: Canada Goose sees Q3 sales of CA$580 million - CA$660 million. Non-IFRS adjusted EPS of CA$1.47 – CA$1.72.
It lowered FY23 sales guidance to CA$1.2 billion – CA$1.3 billion from CA$1.3 billion - CA$1.4 billion. Non-IFRS adjusted EPS of CA$1.31 – CA$1.62 versus the prior view of CA$1.60 - CA$1.90.
Price Action: GOOS shares traded lower by 3.84% at $15.77 on the last check Wednesday.

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