Guess Inc. said its first-quarter profit tumbled 86% as sales slowed at its stores and wholesale purchases of designer clothing declined.
The Los Angeles-based company also reduced the number of stores it will open this year by eight to 17, cutting capital expenditures to $25 million from $40 million. Net income fell to $2.08 million, or 5 cents a share, from $14.4 million, or 33 cents, a year earlier.
The latest results include a charge of about $1 million related to severance and the write-down of inventory and a gain of $1.1 million for the sale of real estate. Revenue fell 10% to $170.1 million.
Retail sales edged up 2% to $79.4 million, while wholesale revenue fell 19% to $81.1 million. Royalty fees fell 7.6% to $9.6 million.
Guess shares closed up 8 cents at $7.26 on the New York Stock Exchange, before the results were announced. Guess also said its board authorized the repurchase of up to $15 million in stock.