Canada Goose sees ‘very large opportunity’ to grow luxury parkas

TORONTO — Cold weather parka maker Canada Goose made huge gains in its online and retail store business and enjoyed a share price surge Friday after blowing past analyst estimates in its first set of results as a publicly traded retailer.

The Toronto apparel and accessories manufacturer’s shares rose as much as 16 per cent after it reported a 22 per cent rise in fourth quarter revenue in the three months ended March 31 to $51.10 million.

Canada Goose, which has one retail store each in Toronto and New York, reported a net loss of $23.4 million, or 23 cents per share, from $9.2 million, or 9 cents per share, a year earlier. Analysts were anticipating a loss of 19 cents per share and revenue of $31.25 million, according to Thomson Reuters.

Canada Goose is introducing new products to appeal to customers on a year-round basis and reported strong performance in its spring collection.

The company is also opening new retail stores in London and Chicago this year as it makes a bigger push into European markets with its online business.

Direct-to-consumer sales, which include the two stores and the online business surged more than 174 per cent to $36.5 million in the quarter.

“Both of our stores performed above our expectations, which is fantastic,” chief executive Dani Reiss said on a conference call Friday with shareholders and analysts.

Direct to consumer sales have soared in the last year to account for 28.6 per cent of total sales, up from less than 5 per cent two years ago and 11 per cent a year ago. As Canada Goose rolls out a handful of stores across the globe and expands its online presence, executives said Friday that its direct to consumer channel will likely account for half of the company’s sales over time.

“Not only has (direct to consumer) driven higher margin expansion due to higher profitability versus wholesale, it also enables us to engage directly with customers for a rich brand experience which is presented through our own filter,” Reiss said.

The company, which operates ecommerce sites in North America, the U.K. and France, is adding seven new European markets to its e-commerce business: Austria, Sweden, Germany, Ireland, Belgium, Luxembourg and the Netherlands.

For the year, Canada Goose’s revenue surged by 39 per cent to $403.8 million from $290.8 million in the prior fiscal year.

Reiss said the brand has seen international demand swell in the U.K., Russia, Japan and Korea. In China, where the brand sells at a handful of wholesale locations, Canada Goose sees “a very large opportunity,” Reiss said. “We are just scratching the surface (in China) and we are thrilled to see that many of our products sell out quickly.”