The company posted third-quarter profit of $34 million, or 40 cents a share, which included a 2-cent tax charge due to restructuring, compared to $36.6 million, or 43 cents in the year-earlier period. Adjusted income of $35.4 million, or 42 cents a share, fell 3.4% compared to the last year's third quarter. The adjusted net earnings exclude restructuring charges of $1.9 million, Guess said.
Still the company managed to beat analysts' expectations of 37 cents a share.
That said, sales suffered in the quarter. Revenue, which includes net sales as well as royalties from licensed products, slipped 2.4% to $613.5 million, below analysts' expectations of $614 million.
Revenue from its retail stores in North America, Europe and Asia divisions all declined in the quarter, Guess said, as retail comparable sales dropped 5% in the quarter. On the other hand, revenue from its licensing segment net revenue increased 3.1% to $32.4 million in the quarter.
Guess shares closed down 1.6% to $33.34 on Wednesday. The stock was falling 1.4% to $32.87 in post-markets trading.
"We delivered revenues within the range of our expectations and through our continued focus on cost control have been able to deliver profitability at the high end of our expectations," CEO Paul Marciano said in a statement. "We are also encouraged by our efforts to efficiently manage our working capital, especially inventory where the trend keeps on improving quarter-over-quarter as we worked through more of our excess inventory and tightly managed our buys."