(Reuters) - Luxury coat maker Canada Goose Holdings Inc GOOS.TO on Thursday posted a 61 percent jump in quarterly profit that beat analysts' estimates, benefiting from its plan to invest more in ecommerce and company-owned stores.
Separately, the company said it named Jonathan Sinclair, who is chief financial officer at high-end shoe retailer Jimmy Choo, as its new finance head.
Sinclair will join Canada Goose sometime mid-year, replacing John Black, who will retire.
“With Canada Goose’s shares up 21 percent year to date, on top of a 135 percent gain last year, expectations were not low headed into third quarter,” RBC Capital Markets analyst Brian Tunick said of the company’s results.
Despite a strong showing in the quarter, the company’s shares fell along with broader global markets, trading down 18 percent at C$39.56. The U.S.-listed shares also fell.
Canada Goose said its net income rose to C$62.9 million or 56 Canadian cents per share in the three months ended Dec. 31, from C$39.1 million or 38 Canadian cents per share, a year earlier.
On an adjusted basis, it earned 58 Canadian cents, beating estimates of 48 Canadian cents, according to Thomson Reuters I/B/E/S.
The company, known for its pricey winter coats, made a successful market debut in 2017, when most other retailers were fighting off falling sales and shrinking margins.
“More and more people today see outerwear as a prominent part of their wardrobe. In introducing over 30 new styles in our fall/winter line, we’re successfully meeting that demand,” Chief Executive Officer Dani Reiss said on a call with analysts.
Margins from stores and online sales were at 76.4 percent during the quarter, compared with gross margins of 51 percent from its wholesale channel.
Revenue rose 21 percent to C$265.8 million. Revenue from selling directly to customers rose almost 83 percent to C$131.6 million, driven by new company-owned stores and ecommerce sites.
Founded in 1957, Canada Goose has historically sold its products through wholesalers, but it started opening its own stores in 2016, banking on its luxury tag and focusing on ecommerce and international markets.
The company, which sells parkas for $900, has said it expects to open up to 20 brick-and-mortar stores around the world by 2020. It has already opened stores in Toronto, New York, Chicago and London since 2016. Canada Goose also operates 11 online stores across North America and Europe.
Reporting by Nivedita Bhattacharjee,; Editing by Sai Sachin Ravikumar, Bernard Orr
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