What has been the revenue trend for GES over recent quarters?
The company reported revenue of $536.7 million in Q1 2020, marking y-o-y growth of 3% over Q1 2019.Higher revenue was driven by growth in retail and wholesale business across geographies - North America, Europe and Asia.Top line growth benefitted from healthy growth in e-commerce and comparable sales, along with new store additions.GES reported adjusted net loss of $0.25 per share in Q1 2020, slightly higher than a loss of $0.23/share in Q1 2019.Higher loss was mainly driven by higher markdowns in US retail, unfavorable business mix in Europe and higher advertising expense.Trefis estimates suggest that revenue and margin performance in the remaining three quarters would be better, leading to growth in top and bottom line for FY 2020
What has been the expense trend for GES over recent quarters?
Company's total expenses have largely trended upwards on year-on-year basis over the recent quarters, driven by higher distribution costs, increase in advertising and marketing cost, asset impairments and volatility in tax outgo
% Change in Total Expenses (Y-o-Y)
% Change in Total Expenses (Q-o-Q)
What is driving change in total expenses and profitability?
Net income margin remained almost flat on y-o-y basis in Q1 2020, driven by better product cost management, offset by higher spending on advertising and lower tax benefits received during the quarter
Net Income Margin
Cost of sales increased by 2.1% (y-o-y) in Q1 2020, driven by higher markdown in US, unfavorable business mix in Europe and higher distribution cost. However, COGS as % of revenue decreased to 66.1% from 66.6% from the year-ago period
Cost of Goods Sold
Increase in SG&A cost was primarily due to increase in professional service and legal fee, along with higher advertising expense. SG&A as a % of revenue increased to 38.2% from 38% in the year ago period
The effective tax rate was higher in Q1 2020 compared to the previous year period in the absence of any re-measurement of deferred tax assets unlike last year
Effective Tax Rate