Lineups return to Canada Goose stores amid rebound in shoppers, especially in China

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Shoppers are once again queuing up outside Canada Goose stores amid a strong rebound in foot traffic and demand for the luxury parka maker’s expanding collection, the company said Thursday.

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“Our stores were busy and the familiar lineups have returned,” Canada Goose Holdings Inc. chairman and CEO Dani Reiss told analysts during a conference call.

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“Our stores in every market performed well, with traffic rebounding” especially in the Asia Pacific region and Europe, the Middle East, Africa and Latin America, Reiss said.

His comments came as Canada Goose recorded a more than 30 per cent increase in revenue in the fourth quarter ended April 2.

The company reported a loss of $3.1 million in the final quarter of its 2023 financial year, compared with a loss of $9.1 million a year earlier.

The outerwear maker said it lost three cents per diluted share in the quarter, down from a loss of nine cents per diluted share a year earlier.

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Revenue totalled $293.2 million, up from $223.1 million in the same quarter last year.

While Canada Goose recorded strong sales in Asia and other regions including Europe, demand in North America was more mixed, Reiss said.

“We saw softer sales in the U.S. in our fourth quarter, with the overall growth we saw across our stores offset by lower e-commerce results,” he said.

“We attribute this to the macro environment in the quarter, where economic uncertainty affected consumer behaviour.”

Yet an acceleration in sales in the United States towards the end of the fourth quarter and into the current quarter offers “confidence in the business recovery,” Reiss said.

In Canada — the company’s home market — sales were up 41 per cent, led by 170 per cent growth in apparel sales, he said.

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“I’m pleased to see one of our most mature markets driving such strong results,” Reiss said. “We’ve seen growth in our repeat customers cohort. We ended fiscal year 2023 with repeat customers making up almost a third of our base.”

Part of that growth comes from an expansion of the retailer’s product mix beyond down parkas.

Canada Goose said it diversified its product sales mix in the quarter, with non-heavyweight down products making up 47.1 per cent of sales, up from 45.4 per cent.

In its outlook for its 2024 financial year, Canada Goose said it expects total revenue between $1.4 billion and $1.5 billion and an adjusted profit between $1.20 and $1.48 per diluted share. Revenue in its first quarter is expected between $70 million and $80 million, while its adjusted loss per share is forecast between 82 and 89 cents for the quarter.

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Reiss underscored the company’s three “growth pillars” for the upcoming year, which include accelerating consumer-focused growth, building the company’s direct-to-consumer channel and creating new and expanded product categories.

The company plans to open 16 permanent stores in the coming year, including in the United States, China, Japan and Australia, he said.

Canada Goose said it earned 14 cents per diluted share on an adjusted basis, up from an adjusted profit of four cents per diluted share a year earlier.

Analysts on average had expected an adjusted profit of 11 cents per share and $259.1 million in revenue, according to estimates compiled by financial markets data firm Refinitiv.

This report by The Canadian Press was first published May 18, 2023.

Companies in this story: (TSX:GOOS)