Strength in China as well as the Europe, Middle East, and Africa region helped performance luxury brand Canada Goose record a 31.4% increase in sales for the fiscal fourth quarter ended April 2.
“I am pleased with our fourth quarter results, particularly the strong revenue results generated in Greater China and EMEA,” said Dani Reiss, Chairman and CEO, in a statement. “This is a testament to the strength of the brand and this momentum has continued alongside early encouraging results in North America in fiscal 2024 year to date.”
The company said it is looking to grow in the future by increasing its appeal with younger customers, growing its DTC network, and expanding into new product categories.
Q4 Financial Details
Net sales in the fourth quarter totaled C$293.2 million (US$218 million), with both the direct to consumer and wholesale channels reporting double digit increases.
DTC sales increased 22.6% in the quarter largely due to continued retail store expansion and improved growth and performance within the company’s existing store network.
Meanwhile, wholesale sales rose 30.4% due to an increase in order value globally and a shift in order shipment dates that benefited sales in the quarter.
Canada Goose U.S. Sales Drop
Regionally, the U.S. was the only market to report a decline, with sales down 4.5% in the quarter. The company cited the challenging macro-economic outlook for the softness in the region.
Gross margin decreased 420 basis points to 64.9% in the prior-year period due to higher costs and other factors.
Canada Goose reported a net loss of C$10 million (US$7.4 million) versus a net loss of C$9.1 million (US$6.73 million) in the same period last year due to higher interest and finance costs and higher income tax expenses.
2023 Full Year Results
The company’s sales rose 10.8% to C$1.22 billion (US$0.9 billion) for the full year.
Net income declined 27% to C$68.9 million (US$51 million).
Canada Goose Growth Plan
Canada Goose is highlighting three key areas in the near future:
- Targeting women and Generation Z customers as a growth opportunity. It plans to invest more in marketing and to further its customer relationship management capabilities to attract consumers and build relationships with those groups.
- Building its direct-to-consumer network. The company plans to double its retail footprint from 51 stores by the end of fiscal 2028 at the same time growing its digital presence, both via omnichannel and online. In fiscal 2024, its planning to open to 16 new stores in China, the U.S. and Japan.
- Creating new and expanding existing categories. The company had some success diversifying its product mix in 2023. For example, it ended the year with non-heavyweight down sales representing 42.9% of total sales, up from 38.5% from the prior year. It also plans to grow rainwear, apparel, and footwear going forward, and move into new categories such as eyewear, luggage and home.
For fiscal 2024, the company expects total revenue to range from C$1.4 billion to C$1.5 billion (US$1 billion – US$1.1 billion).
The company continues to expect that DTC will be its largest distribution channel, comprising in the mid-to-high 70s as a percentage of total revenue for the year.
Canada Goose also owns Baffin, a Canadian designer and manufacturer of performance outdoor and industrial footwear.
Bart Schaneman can be reached at email@example.com.