Nov 2 (Reuters) – Luxury parka maker Canada Goose Holdings Inc ( GOOS.TO ) cut its full-year revenue and profit forecast on Wednesday, as Covid-related lockdowns and store closures in China hurt its business.
The company’s Toronto-listed shares were down 2 percent in morning trading.
The Chinese government’s efforts to curb the spread of Covid-19 cases with its zero-covid policy have affected luxury fashion retailers, which have had a major impact on their revenues due to store closures, inflated prices and falling demand as consumers become more cautious. Range.
European peer Careing ( PRTP.PA ) and cosmetics companies L’Oreal ( OREP.PA ) and Estee Lauder ( EL.N ) all indicated that travel lockdowns and restrictions in China due to COVID-19 had dragged on their performance. quarter
The company did not specifically disclose how much of its revenue comes from China, but said 20.3 percent of revenue in the second quarter came from the Asia-Pacific region.
Canada Goose raised its fiscal 2023 sales forecast to C$1.2 billion (882.74 million)-C$1.3 billion, from C$1.3 billion-C$1.4 billion. The 2023 adjusted earnings per share forecast was lowered to C$1.31-C$1.62, from C$1.60-C$1.90.
Demand for luxury goods outside China, however, remained strong during the holiday season despite a surge in prices, CEO Danny Reiss told Reuters.
“We expect sales growth to accelerate again in FY23 and FY24 as sales in Asia continue to improve over the next 12 months and margins for luxury apparel brands are better than non-luxury brands,” CFRA analyst Zachary Waring said.
The company posted adjusted profit of C$277.2 million, 22 Canadian cents, to beat analysts’ estimates in Refinitive data.
($1 = 1.3594 Canadian dollars)
Reporting by Grant Vanaike in Bengaluru; Edited by Krishna Chandra Elluri
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