TORONTO — Luxury outerwear maker Canada Goose Holdings Inc. beat expectations and turned a profit in its latest quarter as demand in China heated up and online sales grew.
The company, known for its pricey winter parkas with distinctive red, white and blue arm patches, said Thursday revenues in China were up 30 per cent while e-commerce sales increased 10 per cent.
Still, overall sales fell compared with a year ago as the pandemic continued to weigh on results, with fewer people in stores and a decrease in wholesale orders from partners and distributors.
"We continue to navigate the complexities in today's world and witness how the pandemic is reshaping the global economic landscape," Dani Reiss, president and CEO or Canada Goose, said during a call with investors.
But he said the results for the quarter ended Sept. 27 provide a "strong backdrop as we head into peak Canada Goose season.”
As winter arrives and people look to spend more time outdoors both socially and recreationally due to COVID-19, city dwellers and avid outdoorspeople alike will need warm outerwear – something Canada Goose is anticipating.
"Consumers are looking to spend more time outside, not just for normal day-to-day purposes but also for necessity," Reiss said. "We believe that this will create an elevated demand for functional, authentic and protective apparel."
He added: "We have never been more relevant and more universally needed."
The luxury parka maker said it earned net income of $10.4 million or nine cents per diluted share for the quarter ended Sept. 27 compared with a profit of $60.6 million or 55 cents per diluted share a year ago.
Revenue fell to $194.8 million from $294.0 million in the same quarter last year.
Canada Goose said e-commerce sales were up, but fewer people in its stores due to the pandemic and a decrease in wholesale orders from partners and distributors weighed on the results.
On an adjusted basis, Canada Goose said it earned $11.5 million or 10 cents per diluted share, compared with an adjusted profit of $63.6 million or 57 cents per diluted share a year ago.
Analysts on average had expected Canada Goose to post an adjusted loss of a penny per share for the quarter, according to financial data firm Refinitiv.
This report by The Canadian Press was first published Nov. 5, 2020.
Companies in this story: (TSX:GOOS)
The Canadian Press