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Guess?, Inc. (NYSE:GES)Q4 2019 Earnings Conference CallMarch 20, 2019, 4:45 p.m. ET
Contents: Prepared Remarks Questions and Answers Call Participants Prepared Remarks:Operator
Good day, everyone, and welcome to the Guess Fourth Quarter Fiscal 2019 Earnings Conference Call. On the call are Carlos Alberini Chief Executive Officer; and Sandeep Reddy, Chief Financial Officer.
During today's call, the company will be making forward-looking statements, including comments regarding future plans, strategic initiatives, capital allocation and short- and long-term financial outlook. The Company's actual results may differ materially from current expectations based on risk factors included in today's press release and the Company's quarterly and annual reports filed with the SEC.
Now I would like to turn the call over to Carlos.
Carlos Alberini -- Chief Executive Officer and Director
Thank you, operator. Good afternoon and thank you all for joining us today. As most of you know, I spent 10 years with Guess between the years 2000 and 2010 as President and Chief Operating Officer. During those years, the Company had tremendous revenue and profit growth both domestically and internationally, and we created significant shareholder value. During the last nine years, I was Co-CEO of Restoration Hardware and then Investor and CEO of Lucky Brand.
I believe that those experiences and my time at Guess, prepared me well for the role of CEO of Guess. This was and is my dream job, and I am thrilled to have the opportunity to work with Paul and the Guess team again. While nine years may seem like a long time, it took me no time to feel I was back home. In my few weeks back here, I found the team to be highly committed and excited to take the Company to the next level of growth and profitability. More recent Paul, our entire Board and our people at the Company couldn't have been more welcoming to me in this new chapter. And I am very appreciated of the response that I received from the Guess team all over the world.
My decision to rejoin the Company was about being part again of this strong culture which reflects my own personal values and beliefs. My decision was also about the opportunity to make a big contribution and create significant value. Very early on, I learned that the Guess brand had a tremendous global opportunity and we drove exponential growth back then. The international growth accelerated during the last few years. And today Guess has distribution in more than 95 countries and has global sales of retail value of over $5 billion.
Considering the strong momentum and position that the brand has today in the global marketplace, its relevancy with consumers and the extensive white space that there is for the brand in all regions, it is easy to see that the opportunity for global growth is still significant. Last I'm also excited about this opportunity, because I believe that there are multiple operating areas in the business where performance could and should improve. And I think that we can develop a vision and lead the team to drive those improvements. We already started this work.
Let me now touch on Paul and our relationship. I believe that working together toward a common goal with complete transparency, integrity and trust is the best and only way to win. This is exactly the way Paul and I -- and at the time Maurice worked together. We were always united. We could disagree on certain issues, but we discussed them directly and with complete openness and eventually we agreed on a resolution that we all supported. We then articulated our vision to the team and execute it consistently. I think the world of Paul and have tremendous respect for him. He has incredible talents and a commitment to this Company and to this brand that is unmatched.
I believe we both have different skill sets that complement one another and we plan to take full advantage of our combined strengths. I am very proud and extremely excited to join in this new journey together. I would like to spend a few minutes sharing with you what I found coming back into the Company. First, brand relevancy. Guess will turn 38 this year and we all know how difficult it is to remain relevant with today's discerning consumers, through very innovative initiatives and highly meaningful collaborations with key celebrities, the Guess brand is engaging new customer profiles that are representative of millennials and Generation Zs, which now represent more than half of the online customers doing business with Guess in the US.
Great examples of brand partnerships driven by Nicolai Marciano and his team have been a ASAP Rocky, J Balvin, 88 Rising, Places Plus Faces and Shawn Borders Sean Wotherspoon. Through authentic positioning and product capsule, Guess has been able to attract a younger consumer that has developed into a community of brand ambassadors. Second, big white space for global growth. I've found that the store expansion of the past few years has been accretive and value enhancing for our store portfolio. The new stores are profitable with good lease conditions and on average are achieving plans. Still, in spite of the accelerated growth, I believe that we have significant white space for global expansion.
As I mentioned, Guess has sales at retail value of over $5 billion with a very diversified assortment of product categories, including an expensive offering of accessories, handbags and footwear. We know that other comparable brands which have similar country distribution but have less diversified assortments have reached between $7 billion and $9 billion in retail sales globally. So our opportunity should exceed 40% to 80% of growth from current levels, once we would reach development in all global markets. As part of this, many territories offer significant opportunities for further development and we are seeing accelerated growth in them. Good examples are China, Japan and Eastern and Northern Europe. This revenue momentum has contributed to double digit growth for us this past year.
Third, existing growing businesses. I
Read More First Published on Mar 20, 2019 04:00 pm
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