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Delaware
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95-3679695
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification Number)
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1444 South Alameda Street
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Los Angeles,
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California
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90021
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Title of each class
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Trading symbol(s)
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Name of each exchange on which registered
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Common Stock, par value $0.01 per share
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GES
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New York Stock Exchange
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Large accelerated filer
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☒
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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Item
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Description
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Page
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Year Ended
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Year Ended
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Year Ended
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||||||||||||
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Feb 1, 2020
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Feb 2, 2019
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Feb 3, 2018
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Region
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Stores
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Concessions
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Stores
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Concessions
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Stores
|
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Concessions
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||||||
United States
|
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280
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—
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288
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—
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306
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—
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Canada
|
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80
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—
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89
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—
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89
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—
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Central and South America
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73
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27
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67
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27
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59
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27
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Total Americas
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433
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27
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444
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27
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454
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27
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Europe and the Middle East
|
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517
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39
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490
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37
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400
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33
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Asia and the Pacific
|
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219
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117
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227
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174
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157
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|
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177
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Total
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1,169
|
|
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183
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1,161
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238
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1,011
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237
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Year Ended
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Year Ended
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Year Ended
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||||||||||||
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Feb 1, 2020
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Feb 2, 2019
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Feb 3, 2018
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Region
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Stores
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Concessions
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Stores
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Concessions
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Stores
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Concessions
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United States
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2
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1
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2
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1
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2
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1
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Central and South America
|
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40
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—
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37
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—
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44
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—
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Total Americas
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42
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1
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39
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1
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46
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1
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Europe and the Middle East
|
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228
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—
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210
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—
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269
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—
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Asia and the Pacific
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290
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210
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309
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184
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337
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191
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Total
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560
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211
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558
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185
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652
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192
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•
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political instability or acts of terrorism, which disrupt trade with the countries where we operate or in which our contractors, suppliers or customers are located;
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•
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recessions in foreign economies;
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•
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inflationary pressures and volatility in foreign economies;
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•
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reduced global demand resulting in the closing of manufacturing facilities;
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•
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challenges in managing broadly dispersed foreign operations;
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•
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local business practices that do not conform to legal or ethical guidelines;
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•
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adoption of additional or revised quotas, restrictions or regulations relating to imports or exports;
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•
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additional or increased customs duties, tariffs, taxes and other charges on imports or exports;
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•
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anti-American sentiment in foreign countries where we operate resulting from actual or proposed changes to U.S. immigration and travel policies or other factors;
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•
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delays in receipts due to our distribution centers as a result of labor unrest, increasing security requirements or other factors at U.S. or other ports;
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•
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significant fluctuations in the value of the dollar against foreign currencies;
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•
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increased difficulty in protecting our intellectual property rights in foreign jurisdictions;
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•
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social, labor, legal or economic instability in the foreign markets in which we do business, which could influence our ability to sell our products in, or distribute our products from, these international markets;
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•
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restrictions on the transfer of funds between the U.S. and foreign jurisdictions;
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•
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our ability and the ability of our international retail store licensees, distributors and joint venture partners to locate and continue to open desirable new retail locations; and
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•
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natural disasters or public health crises in areas in which our contractors, suppliers, or customers are located.
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•
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identify desirable locations, the availability of which is out of our control;
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•
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negotiate acceptable lease terms, including desired tenant improvement allowances;
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•
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efficiently build and equip the new stores;
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•
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source sufficient levels of inventory to meet the needs of the new stores;
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•
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hire, train and retain competent store personnel;
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•
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successfully integrate the new stores into our existing systems and operations; and
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•
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satisfy the fashion preferences of customers in the new geographic areas.
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•
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elect our directors;
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•
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amend or prevent amendment of our Restated Certificate of Incorporation or Bylaws;
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•
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effect or prevent a merger, sale and/or purchase of assets or other corporate transactions; and
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•
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control the outcome of any other matter submitted to our stockholders for vote.
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•
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shifts in consumer tastes and fashion trends;
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•
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the timing of new store openings and the relative proportion of new stores to mature stores;
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•
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the timing and effectiveness of planned store closures;
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•
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calendar shifts of holiday or seasonal periods;
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•
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the timing of seasonal wholesale shipments;
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•
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the effectiveness of our inventory management;
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•
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the effectiveness and efficiency of our product distribution network;
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•
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changes in our merchandise mix;
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•
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changes in our mix of revenues by segment;
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•
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the timing of promotional events;
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•
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actions by competitors;
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•
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weather conditions;
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•
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public health crises;
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•
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changes in the business environment;
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•
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inflationary changes in prices and costs;
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•
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changes in the payment of future cash dividends;
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•
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changes in currency exchange rates;
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•
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population trends;
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•
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changes in patterns of commerce such as the expansion of e-commerce;
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•
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the level of pre-operating expenses associated with new stores; and
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•
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volatility in securities’ markets which could impact the value of our investments in non-operating assets.
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•
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increasing our vulnerability to adverse economic and industry conditions;
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•
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limiting our ability to obtain additional financing;
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•
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requiring the dedication of a substantial portion of our cash flow from operations to service our indebtedness, which will reduce the amount of cash available for other purposes;
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•
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limiting our flexibility to plan for, or react to, changes in our business;
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•
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diluting the interests of our existing stockholders as a result of issuing shares of our common stock upon conversion of the Notes; and
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•
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placing us at a possible competitive disadvantage with competitors that are less leveraged than us or have better access to capital.
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•
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our cash requirements or plans might change for a wide variety of reasons, including changes in our financial position, capital allocation plans (including a desire to retain or accumulate cash), capital spending plans, stock purchase plans, acquisition strategies, strategic initiatives, debt payment plans (including a desire to maintain or improve credit ratings on our debt securities), pension funding or other benefits payments;
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•
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our ability to service and refinance our current and future indebtedness and our ability to borrow or raise additional capital to satisfy our capital needs;
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•
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the amount of dividends that we may distribute to our shareholders is subject to restrictions under applicable law and restrictions imposed by our existing or future credit facilities, debt securities, then-outstanding preferred stock securities, if any, leases and other agreements, including restricted payment and leverage covenants; and
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•
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the amount of cash that our subsidiaries may make available to us, whether by dividends, loans or other payments, may be subject to the legal, regulatory and contractual restrictions in our outstanding indebtedness.
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Location
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Use
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Approximate
Area in
Square Feet
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Los Angeles, California
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Principal executive and administrative offices, design facilities, sales offices, warehouse facilities and sourcing used by our Americas Wholesale, Americas Retail, Corporate and Licensing support groups
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341,700
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Louisville, Kentucky
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Distribution and warehousing facility used by our Americas Wholesale and Americas Retail segments
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506,000
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Montreal/Toronto/Vancouver, Canada
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Administrative offices, showrooms and warehouse facilities used by our Americas Wholesale and Americas Retail segments
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203,100
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Lugano/Stabio, Switzerland
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Administrative, sales and marketing offices, design facilities and showrooms used by our Europe segment
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158,700
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Venlo, Netherlands
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Distribution and warehousing facilities used by all of our segments
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1,046,400
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Florence, Italy
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Administrative office used by our Europe segment
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113,000
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Shanghai, China
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Administrative offices used by our Asia segment
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17,800
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Seoul, South Korea
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Administrative and sales offices, design facilities and showrooms used by our Asia segment
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54,700
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Period
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Total Number of Shares Purchased
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Average Price Paid
per Share
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Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
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Maximum Number
(or Approximate Dollar Value) of Shares That May Yet Be Purchased Under the Plans or Programs
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||||||
November 3, 2019 to November 30, 2019
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||||||
Repurchase program1
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—
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—
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—
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$
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94,149,167
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Employee transactions2
|
137
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|
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$
|
18.17
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—
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December 1, 2019 to January 4, 2020
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|
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||||||
Repurchase program1
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—
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—
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|
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—
|
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$
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94,149,167
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|
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Employee transactions2
|
345
|
|
|
$
|
18.93
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|
|
—
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January 5, 2020 to February 1, 2020
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|
|
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||||||
Repurchase program1
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327,131
|
|
|
$
|
22.92
|
|
|
327,131
|
|
|
$
|
86,650,889
|
|
Employee transactions2
|
123,841
|
|
|
$
|
22.00
|
|
|
—
|
|
|
|
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Total
|
|
|
|
|
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|
||||||
Repurchase program1
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327,131
|
|
|
$
|
22.92
|
|
|
327,131
|
|
|
|
|
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Employee transactions2
|
124,323
|
|
|
$
|
21.99
|
|
|
—
|
|
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1
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On June 26, 2012, the Company’s Board of Directors authorized a program to repurchase, from time-to-time and as market and business conditions warrant, up to $500 million of the Company’s common stock. Repurchases under the program may be made on the open market or in privately negotiated transactions, pursuant to Rule 10b5-1 trading plans or other available means. There is no minimum or maximum number of shares to be repurchased under the program, which may be discontinued at any time, without prior notice.
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2
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Consists of shares surrendered to, or withheld by, the Company in satisfaction of employee tax withholding obligations that occur upon vesting of restricted stock awards/units granted under the Company’s 2004 Equity Incentive Plan, as amended.
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Company/Market/Peer Group
|
|
1/31/2015
|
|
1/30/2016
|
|
1/28/2017
|
|
2/3/2018
|
|
2/2/2019
|
|
2/1/2020
|
||||||||||||
Guess?, Inc.
|
|
$
|
100.00
|
|
|
$
|
103.37
|
|
|
$
|
72.71
|
|
|
$
|
92.49
|
|
|
$
|
125.43
|
|
|
$
|
144.78
|
|
S&P 1500 Apparel Retail Index
|
|
100.00
|
|
|
104.15
|
|
|
101.48
|
|
|
107.84
|
|
|
119.99
|
|
|
133.21
|
|
||||||
S&P 500 Index
|
|
100.00
|
|
|
99.33
|
|
|
120.06
|
|
|
147.48
|
|
|
147.40
|
|
|
179.17
|
|
|
Years Ended1
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||||||||||||||||||
|
Feb 1,
2020 |
|
Feb 2,
2019 |
|
Feb 3,
2018 |
|
Jan 28,
2017 |
|
Jan 30,
2016 |
||||||||||
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(in thousands, except per share data)
|
||||||||||||||||||
Statements of income (loss) data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net revenue
|
$
|
2,678,109
|
|
|
$
|
2,609,694
|
|
|
$
|
2,363,754
|
|
|
$
|
2,190,453
|
|
|
$
|
2,184,495
|
|
Earnings from operations2,3,4,5,6,7,8
|
140,671
|
|
|
52,212
|
|
|
67,355
|
|
|
24,763
|
|
|
122,439
|
|
|||||
Income tax expense9
|
22,513
|
|
|
29,542
|
|
|
74,172
|
|
|
28,212
|
|
|
42,464
|
|
|||||
Net earnings (loss) attributable to Guess?, Inc.2,3,4,5,6,7,8,9,10,11
|
95,975
|
|
|
14,099
|
|
|
(7,894
|
)
|
|
22,761
|
|
|
81,851
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings (loss) per common share attributable to common stockholders2,3,4,5,6,7,8,9,10,11,12:
|
|||||||||||||||||||
Basic
|
$
|
1.35
|
|
|
$
|
0.17
|
|
|
$
|
(0.11
|
)
|
|
$
|
0.27
|
|
|
$
|
0.97
|
|
Diluted
|
$
|
1.33
|
|
|
$
|
0.16
|
|
|
$
|
(0.11
|
)
|
|
$
|
0.27
|
|
|
$
|
0.96
|
|
Dividends declared per common share
|
$
|
0.5625
|
|
|
$
|
0.9000
|
|
|
$
|
0.9000
|
|
|
$
|
0.9000
|
|
|
$
|
0.9000
|
|
Weighted average common shares outstanding—basic
|
70,461
|
|
|
80,146
|
|
|
82,189
|
|
|
83,666
|
|
|
84,264
|
|
|||||
Weighted average common shares outstanding—diluted
|
71,669
|
|
|
81,589
|
|
|
82,189
|
|
|
83,829
|
|
|
84,525
|
|
|
Feb 1,
2020 |
|
Feb 2,
2019 |
|
Feb 3,
2018 |
|
Jan 28,
2017 |
|
Jan 30,
2016 |
||||||||||
Balance sheet data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Working capital13
|
$
|
425,822
|
|
|
$
|
545,331
|
|
|
$
|
640,860
|
|
|
$
|
698,559
|
|
|
$
|
709,193
|
|
Total assets13
|
2,428,962
|
|
|
1,649,205
|
|
|
1,655,634
|
|
|
1,534,485
|
|
|
1,538,748
|
|
|||||
Long-term debt, including convertible senior notes, net, borrowings and finance lease obligations10
|
280,133
|
|
|
35,012
|
|
|
39,196
|
|
|
23,482
|
|
|
2,318
|
|
|||||
Stockholders’ equity10
|
661,347
|
|
|
853,645
|
|
|
933,475
|
|
|
980,994
|
|
|
1,031,293
|
|
1
|
The Company operates on a 52/53-week fiscal year calendar, which ends on the Saturday nearest to January 31 of each year. The results for fiscal 2018 included the impact of an additional week which occurred during the fourth quarter ended February 3, 2018.
|
2
|
During each of the years presented, the Company recognized asset impairment charges related primarily to impairment of certain retail locations resulting from under-performance and expected store closures. During fiscal 2020, asset impairment charges also included impairment charges related to goodwill associated with the Company’s China retail reporting unit and impairment charges related to certain operating lease right-of-use assets. Asset impairment charges recognized were approximately $10.0 million in fiscal 2020, $6.9 million in fiscal 2019, $8.5 million in fiscal 2018, $34.4 million in fiscal 2017 and $2.3 million in fiscal 2016. Refer to “Part IV. Financial Statements – Note 5 – Property and Equipment,” “Part IV. Financial Statements – Note 6 – Goodwill” and “Part IV. Financial Statements – Note 9 – Lease Accounting” in this Form 10-K for further detail.
|
3
|
During fiscal 2019, the Company incurred net gains on lease terminations of $0.5 million related primarily to the early termination of certain lease agreements in North America. During fiscal 2018, the Company incurred net losses on lease terminations of $11.4 million related primarily to the modification of certain lease agreements held with a common landlord
|
4
|
During fiscal 2020, fiscal 2019 and fiscal 2018, the Company incurred certain professional service and legal fees and related (credits) costs of ($0.9) million, $6.1 million and $0.5 million, respectively.
|
5
|
During fiscal 2019, the Company announced the departure of its former Chief Executive Officer and the terms of his separation. As a result, the Company recorded $5.2 million in separation-related charges during fiscal 2019. The Company also recorded $0.4 million during fiscal 2020 mainly related to non-cash stock-based compensation expense resulting from changes in expected performance conditions of certain previously granted stock awards that were no longer subject to service vesting requirements after his departure.
|
6
|
During fiscal 2019, the Company incurred charges of €39.8 million ($45.6 million) for a fine imposed by the European Commission related to alleged violations of European Union competition rules by the Company. The Company paid the full amount of the fine during the first quarter of fiscal 2020.
|
7
|
During fiscal 2017, the Company incurred restructuring charges of $6.1 million.
|
8
|
During fiscal 2016, the Company recognized a $1.7 million curtailment gain, before taxes, related to an amendment that accelerated the amortization of the prior service credit.
|
9
|
During fiscal 2019, the Company incurred additional expense of $6.3 million related to revising the provisional amounts previously recorded related to deemed repatriation of foreign earnings related to the Tax Reform. During fiscal 2018, the Company recognized additional tax expense of $47.9 million related to the enactment of the Tax Reform. This was comprised of a $24.9 million charge for the provisional re-measurement of certain deferred taxes and related amounts and a provisional charge of $23.0 million to income tax expense for the estimated effects of the transitional tax on the deemed repatriation of foreign earnings. During fiscal 2017, the Company recorded valuation reserves of $6.8 million resulting from jurisdictions where there were cumulative net operating losses, limiting the Company’s ability to consider other subjective evidence to continue to recognize the existing deferred tax assets. During fiscal 2017, the Company also recorded an estimated exit tax charge of $1.9 million related to the Company’s reorganization in Europe as a result of its global cost reduction and restructuring plan. Refer to “Part IV. Financial Statements – Note 12 – Income Taxes” in this Form 10-K for further detail.
|
10
|
In April 2019, the Company issued $300 million principal amount of 2.00% convertible senior notes due 2024 (the “Notes”) in a private offering. The Company has separated the Notes into liability (debt) and equity (conversion option) components. The debt discount, which represents an amount equal to the fair value of the equity component, will be amortized as non-cash interest expense over the term of the Notes. During fiscal 2020, the Company recognized $7.6 million related to the amortization of the debt discount on the Company’s convertible senior notes. The Company used substantially all of the net proceeds from the Notes (after the related hedge and warrant transactions) to repurchase shares of its common stock. Per common share amounts for fiscal 2020 reflect the net impact of share repurchases (including those made through our accelerated share repurchase program), cash interest expense and amortization of debt discount and debt issuance costs. Refer to “Part IV. Financial Statements – Note 10 – Convertible Senior Notes and Related Transactions” and “Part IV. Financial Statements – Note 23 – Share Repurchase Program” in this Form 10-K for further detail.
|
11
|
During fiscal 2017, the Company sold its minority interest equity holding in a privately-held boutique apparel company for net proceeds of approximately $34.8 million, which resulted in a gain of approximately $22.3 million which was recorded in other income.
|
12
|
Holders of the Company’s restricted stock awards are not required to participate in losses of the Company. Accordingly, in periods in which the Company reported a net loss, such losses were not allocated to these participating securities, and as a result, basic and diluted net loss per share were the same in those periods.
|
13
|
During fiscal 2020, the Company adopted a comprehensive new lease standard which superseded previous lease guidance using a modified retrospective method that does not restate prior periods to be comparable to current period presentation. The standard requires a lessee to recognize an asset related to the right to use the underlying asset and a liability that approximates the present value of the lease payments over the term of contracts that qualify as leases under the new guidance. The adoption of the standard resulted in the recording of operating lease right-of-use assets (which were classified as long-term assets) and operating lease liabilities (of which a portion was classified as current liabilities with the remaining classified as long-term liabilities depending on the timing of the respective lease payments). In addition, other assets no longer includes lease acquisition costs and other long-term liabilities no longer includes deferred rent and unamortized lease incentives since these items are now included in operating lease right-of-use assets due to the adoption of the new standard. Refer to “Part IV. Financial Statements – Note 2 – New Accounting Guidance” and “Part IV. Financial Statements – Note 9 – Lease Accounting” in this Form 10-K for further detail.
|
•
|
Total net revenue increased 2.6% to $2.68 billion for fiscal 2020, compared to $2.61 billion in the prior year. In constant currency, net revenue increased by 5.4%.
|
•
|
Gross margin (gross profit as a percentage of total net revenue) increased 190 basis points to 37.9% for fiscal 2020, compared to 36.0% in the prior year.
|
•
|
Selling, general and administrative (“SG&A”) expenses as a percentage of total net revenue (“SG&A rate”) increased 20 basis points to 32.2% for fiscal 2020, compared to 32.0% in the prior year. SG&A expenses increased 3.6% to $865.1 million for fiscal 2020, compared to $835.3 million in the prior year.
|
•
|
During fiscal 2019, the Company recognized charges of €39.8 million ($45.6 million) for a fine imposed by the European Commission related to alleged violations of European Union competition rules by the Company. The Company paid the full amount of the fine during the first quarter of fiscal 2020.
|
•
|
During fiscal 2020, the Company recognized asset impairment charges of $10.0 million, compared to $6.9 million in the prior year.
|
•
|
During fiscal 2019, the Company recognized net gains on lease terminations of $0.5 million.
|
•
|
Operating margin increased 330 basis points to 5.3% for fiscal 2020, compared to 2.0% in the prior year. The European Commission fine unfavorably impacted operating margin by 170 basis points during fiscal 2019. Lower expenses related to certain professional service and legal fees and related (credits) costs recorded during fiscal 2020 favorably impacted operating margin by 30 basis points compared to the prior year. Lower CEO separation charges recorded during fiscal 2020 favorably impacted operating margin by 20 basis points compared to the prior year. Higher asset impairment charges recorded during fiscal 2020 unfavorably impacted operating margin by 10 basis points compared to the prior year. Earnings from operations increased 169.4% to $140.7 million for fiscal 2020, compared to $52.2 million in the prior year.
|
•
|
Other expense, net (including interest income and expense) totaled $16.9 million for fiscal 2020, compared to $5.5 million in the prior year.
|
•
|
The effective income tax rate decreased to 18.2% for fiscal 2020, compared to 63.2% in the prior year. During fiscal 2019, the Company revised the provisional amounts previously recorded related to the impact of the Tax Reform and recorded income tax charges totaling $6.3 million.
|
•
|
The Company had $284.6 million in cash and cash equivalents and $0.2 million in restricted cash as of February 1, 2020, compared to $210.5 million in cash and cash equivalents and $0.5 million in restricted cash at February 2, 2019.
|
◦
|
During fiscal 2019, the Company recognized charges of €39.8 million ($45.6 million) for a fine imposed by the European Commission related to alleged violations of European Union competition rules by the Company. The Company paid the full amount of the fine during the first quarter of fiscal 2020.
|
◦
|
In April 2019, the Company issued $300 million aggregate principal amount of 2.00% convertible senior notes due 2024 in a private offering, for which it received total cash proceeds of $296.2 million, net of initial purchasers’ discounts and commissions and offering costs of $3.8 million. In connection with the issuance of these notes, the Company (i) entered into convertible note hedge transactions for which it paid an aggregate $61.0 million and (ii) sold warrants for which it received aggregate proceeds of $28.1 million. These transactions are intended to reduce the potential dilution with respect to the Company’s common stock upon conversion of the notes and/or offset any cash payments the Company may be required to make in excess of the principal amount of the converted notes.
|
◦
|
During fiscal 2020, the Company used $170 million of proceeds from its convertible senior notes to enter into an ASR Contract, pursuant to which it received a total of approximately 10.6 million shares. During fiscal 2020, the Company also repurchased approximately 6.1 million shares of its common stock in open market and privately negotiated transactions totaling $118.1 million (including commissions). When combined, these transactions resulted in the Company investing $288.1 million to repurchase approximately 16.7 million of its common shares in fiscal 2020. During fiscal 2019, the Company invested $17.6 million to repurchase approximately 1.1 million of its common shares. The Company also paid an additional $6.0 million for shares that were repurchased during the fourth quarter of fiscal 2018 but were settled during the first quarter of fiscal 2019.
|
◦
|
The Company, through its subsidiaries in Europe and China, maintains short-term committed and uncommitted borrowing agreements primarily for working capital purposes. The Company had $4.0 million in outstanding borrowings as of February 1, 2020 and no outstanding borrowings under these agreements at February 2, 2019.
|
•
|
Accounts receivable consists of trade receivables relating primarily to the Company’s wholesale business in Europe and, to a lesser extent, to its wholesale businesses in Asia and the Americas, royalty receivables relating to its licensing operations, credit card and retail concession receivables related to its retail businesses and certain other receivables. Accounts receivable increased by $5.3 million, or 1.6%, to $327.3 million as of February 1, 2020, compared to $322.0 million at February 2, 2019. On a constant currency basis, accounts receivable increased by $14.7 million, or 4.6%.
|
•
|
Inventory decreased by $75.8 million, or 16.2%, to $393.1 million as of February 1, 2020, from $468.9 million at February 2, 2019. On a constant currency basis, inventory decreased by $67.2 million, or 14.3%.
|
|
|
Stores
|
|
Concessions
|
||||||||||||||
Region
|
|
Total
|
|
Directly
Operated
|
|
Partner Operated
|
|
Total
|
|
Directly
Operated
|
|
Partner Operated
|
||||||
United States
|
|
282
|
|
|
280
|
|
|
2
|
|
|
1
|
|
|
—
|
|
|
1
|
|
Canada
|
|
80
|
|
|
80
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Central and South America
|
|
113
|
|
|
73
|
|
|
40
|
|
|
27
|
|
|
27
|
|
|
—
|
|
Total Americas
|
|
475
|
|
|
433
|
|
|
42
|
|
|
28
|
|
|
27
|
|
|
1
|
|
Europe and the Middle East
|
|
745
|
|
|
517
|
|
|
228
|
|
|
39
|
|
|
39
|
|
|
—
|
|
Asia and the Pacific
|
|
509
|
|
|
219
|
|
|
290
|
|
|
327
|
|
|
117
|
|
|
210
|
|
Total
|
|
1,729
|
|
|
1,169
|
|
|
560
|
|
|
394
|
|
|
183
|
|
|
211
|
|
|
|
|
|
||
|
Years Ended
|
||||
|
February 1,
|
|
February 2,
|
||
|
2020
|
|
2019
|
||
Product sales
|
96.8
|
%
|
|
96.8
|
%
|
Net royalties
|
3.2
|
|
|
3.2
|
|
Net revenue
|
100.0
|
|
|
100.0
|
|
Cost of product sales
|
62.1
|
|
|
64.0
|
|
Gross profit
|
37.9
|
|
|
36.0
|
|
Selling, general and administrative expenses
|
32.2
|
|
|
32.0
|
|
European Commission fine
|
—
|
|
|
1.7
|
|
Asset impairment charges
|
0.4
|
|
|
0.3
|
|
Net gains on lease terminations
|
—
|
|
|
(0.0
|
)
|
Earnings from operations
|
5.3
|
|
|
2.0
|
|
Interest expense
|
(0.6
|
)
|
|
(0.1
|
)
|
Interest income
|
0.1
|
|
|
0.2
|
|
Other income (expense), net
|
(0.2
|
)
|
|
(0.3
|
)
|
Earnings before income tax expense
|
4.6
|
|
|
1.8
|
|
Income tax expense
|
0.8
|
|
|
1.1
|
|
Net earnings
|
3.8
|
|
|
0.7
|
|
Net earnings attributable to noncontrolling interests
|
0.2
|
|
|
0.2
|
|
Net earnings attributable to Guess?, Inc.
|
3.6
|
%
|
|
0.5
|
%
|
|
|
|
|
|
|
|
|
|||||||
|
Fiscal 2020
|
|
Fiscal 2019
|
|
Change
|
|
% Change
|
|||||||
Net revenue:
|
|
|
|
|
|
|
|
|
||||||
Americas Retail
|
$
|
811,547
|
|
|
$
|
824,674
|
|
|
$
|
(13,127
|
)
|
|
(1.6
|
%)
|
Americas Wholesale
|
186,389
|
|
|
170,812
|
|
|
15,577
|
|
|
9.1
|
%
|
|||
Europe
|
1,248,114
|
|
|
1,142,768
|
|
|
105,346
|
|
|
9.2
|
%
|
|||
Asia
|
346,212
|
|
|
388,246
|
|
|
(42,034
|
)
|
|
(10.8
|
%)
|
|||
Licensing
|
85,847
|
|
|
83,194
|
|
|
2,653
|
|
|
3.2
|
%
|
|||
Total net revenue
|
$
|
2,678,109
|
|
|
$
|
2,609,694
|
|
|
$
|
68,415
|
|
|
2.6
|
%
|
Earnings (loss) from operations:
|
|
|
|
|
|
|
|
|||||||
Americas Retail
|
$
|
22,279
|
|
|
$
|
27,532
|
|
|
$
|
(5,253
|
)
|
|
(19.1
|
%)
|
Americas Wholesale
|
35,674
|
|
|
29,935
|
|
|
5,739
|
|
|
19.2
|
%
|
|||
Europe
|
134,078
|
|
|
58,298
|
|
|
75,780
|
|
|
130.0
|
%
|
|||
Asia
|
(8,894
|
)
|
|
12,365
|
|
|
(21,259
|
)
|
|
(171.9
|
%)
|
|||
Licensing
|
74,459
|
|
|
72,986
|
|
|
1,473
|
|
|
2.0
|
%
|
|||
Total segment earnings from operations
|
257,596
|
|
|
201,116
|
|
|
56,480
|
|
|
28.1
|
%
|
|||
Corporate overhead
|
(106,948
|
)
|
|
(96,805
|
)
|
|
(10,143
|
)
|
|
10.5
|
%
|
|||
European Commission fine
|
—
|
|
|
(45,637
|
)
|
|
45,637
|
|
|
|
||||
Asset impairment charges
|
(9,977
|
)
|
|
(6,939
|
)
|
|
(3,038
|
)
|
|
43.8
|
%
|
|||
Net gains on lease terminations
|
—
|
|
|
477
|
|
|
(477
|
)
|
|
|
||||
Total earnings from operations
|
$
|
140,671
|
|
|
$
|
52,212
|
|
|
$
|
88,459
|
|
|
169.4
|
%
|
Operating margins:
|
|
|
|
|
|
|
|
|||||||
Americas Retail
|
2.7
|
%
|
|
3.3
|
%
|
|
|
|
|
|||||
Americas Wholesale
|
19.1
|
%
|
|
17.5
|
%
|
|
|
|
|
|||||
Europe
|
10.7
|
%
|
|
5.1
|
%
|
|
|
|
|
|||||
Asia
|
(2.6
|
%)
|
|
3.2
|
%
|
|
|
|
|
|||||
Licensing
|
86.7
|
%
|
|
87.7
|
%
|
|
|
|
|
|||||
Total Company
|
5.3
|
%
|
|
2.0
|
%
|
|
|
|
|
|
Payments due by period
|
||||||||||||||||||
|
Total
|
|
Less than
1 year |
|
1-3 years
|
|
3-5 years
|
|
More than
5 years |
||||||||||
Contractual Obligations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Short-term borrowings
|
$
|
3,957
|
|
|
$
|
3,957
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Convertible senior notes, net1,2
|
327,000
|
|
|
6,000
|
|
|
12,000
|
|
|
309,000
|
|
|
—
|
|
|||||
Long-term debt, excluding convertible senior notes, net1
|
24,280
|
|
|
4,042
|
|
|
2,043
|
|
|
2,080
|
|
|
16,115
|
|
|||||
Finance lease obligations1
|
20,576
|
|
|
3,349
|
|
|
6,902
|
|
|
5,403
|
|
|
4,922
|
|
|||||
Operating lease obligations3
|
1,003,321
|
|
|
220,364
|
|
|
363,481
|
|
|
232,695
|
|
|
186,781
|
|
|||||
Purchase obligations4
|
208,613
|
|
|
208,613
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Benefit obligations5
|
84,202
|
|
|
3,414
|
|
|
5,751
|
|
|
4,703
|
|
|
70,334
|
|
|||||
Total
|
$
|
1,671,949
|
|
|
$
|
449,739
|
|
|
$
|
390,177
|
|
|
$
|
553,881
|
|
|
$
|
278,152
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other commercial commitments6
|
$
|
2,265
|
|
|
$
|
2,265
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
1
|
Includes interest payments.
|
2
|
In April 2019, the Company issued $300 million principal amount of 2.00% convertible senior notes due 2024 (the “Notes”) in a private offering. Refer to “Part IV. Financial Statements – Note 10 – Convertible Senior Notes and Related Transactions” for further detail.
|
3
|
The Company has elected the practical expedient to not separate non-lease components from lease components in the measurement of liabilities for its directly-operated real estate leases. As such, this amount reflects operating lease costs that are considered in the measurement of the related operating lease liabilities, which may include fixed payments related to rent, insurance, property taxes, sales promotion, common area maintenance and certain utility charges, where applicable. This does not include variable lease costs that are excluded from the measurement of the operating lease liabilities, such as those charges that are based on a percentage of annual sales volume or estimates. In fiscal 2020, these variable charges totaled $95.8 million. Refer to “Part IV. Financial Statements – Note 9 – Lease Accounting” for further detail.
|
4
|
Purchase obligations represent open purchase orders for raw materials and merchandise at the end of the fiscal year. These purchase orders can be impacted by various factors, including the scheduling of market weeks, the timing of issuing orders, the timing of the shipment of orders and currency fluctuations.
|
5
|
Includes expected payments associated with the deferred compensation plan and the Supplemental Executive Retirement Plan through fiscal 2055.
|
6
|
Consists of standby letters of credit for workers’ compensation and general liability insurance.
|
|
Year Ended Feb 1, 2020
|
|
Year Ended Feb 2, 2019
|
||||
Beginning balance gain (loss)
|
$
|
2,999
|
|
|
$
|
(14,369
|
)
|
Cumulative adjustment from adoption of new accounting guidance1
|
1,981
|
|
|
—
|
|
||
Net gains from changes in cash flow hedges
|
8,316
|
|
|
10,962
|
|
||
Net (gains) losses reclassified to earnings
|
(6,996
|
)
|
|
6,406
|
|
||
Ending balance gain
|
$
|
6,300
|
|
|
$
|
2,999
|
|
1
|
During the first quarter of fiscal 2020, the Company adopted new authoritative guidance which eliminated the requirement to separately measure and report ineffectiveness for instruments that qualify for hedge accounting and generally requires that the entire change in the fair value of such instruments ultimately be presented in the same line as the respective hedge item. As a result, there is no interest component recognized for the ineffective portion of instruments that qualify for hedge accounting, but rather all changes in the fair value of such instruments are included in other comprehensive income (loss) during fiscal 2020. Upon adoption of this guidance, the Company reclassified $2.0 million in gains from retained earnings to accumulated other comprehensive loss related to the previously recorded interest component on outstanding instruments that qualified for hedge accounting.
|
/s/ ERNST & YOUNG LLP
|
|
(1)
|
Consolidated Financial Statements
|
(2)
|
Consolidated Financial Statement Schedule
|
(3)
|
Exhibits
|
|
|
|||
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
Impairment of right-of-use assets and property and equipment
|
|
|
|
Description of the Matter
|
|
As described in Note 1 to the consolidated financial statements, to assess its regular retail store asset groups for impairment, the Company utilizes significant judgment in evaluating whether a regular retail store asset group may be impaired based upon its ability to generate earnings from operations and positive future cash flows in future periods or if there are significant changes in
|
|
|
the Company’s strategic business objectives and utilization of assets. Any impairment of a regular retail store asset group would be allocated between the operating lease right-of-use assets and property and equipment such that the asset group is recorded at fair value.
|
|
|
Our assessment of management’s analyses of the impairment measurement for the regular retail locations involved a high degree of subjectivity, as estimates underlying the determination of fair value of a regular retail store asset group were based on assumptions that may be affected by future operations of the Company, market or economic conditions. The Company uses various assumptions in determining current fair market value of its regular retail store asset group, including future expected cash flows. The significant assumptions used in calculating future expected cash flows are sales and gross margin growth rates. Future expected cash flows for a regular retail store asset group are based on management’s estimates of future cash flows over the remaining lease period or expected life, if shorter.
|
|
|
|
How We Addressed the Matter in Our Audit
|
|
We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over management’s processes to determine the fair value of regular retail store asset groups and measure any impairment. This included controls over management’s determination and assessment of the sales and gross margin growth rates underlying the fair value calculation.
Our audit procedures included, among others, evaluating the significant assumptions for the determination of fair value of regular retail asset groups and testing the underlying data used in management’s estimation for relevancy, completeness and accuracy. Evaluating the significant assumptions used by management in the impairment assessment involved considering current and past performance of the regular retail store asset group, evaluating whether the assumptions were consistent with evidence obtained in other areas of the audit and with key performance indicators across the industry. We have also evaluated the Company’s long-lived asset impairment disclosures included in Note 5 and Note 9 in relation to this matter.
|
|
|
Convertible Senior Notes
|
|
|
|
Description of the Matter
|
|
As described in Note 1 to the consolidated financial statements, in April 2019, the Company issued $300 million of convertible senior notes due in 2024 in a private offering (Convertible Notes). Additionally, to offset the dilutive impact of the conversion of the Convertible Notes, the Company entered into convertible note bond hedge transactions and issued call option warrants which allow holders to have the option to purchase common stock shares of the Company. These transactions are collectively referred to as the Convertible Notes Transactions.
To account for the Convertible Notes, the Company was required to separate the Convertible Notes into liability and equity components. The standalone liability component was recorded at fair value, which was based on the use of a complex valuation technique to measure the fair value of a similar liability that does not have a conversion feature. To calculate the fair value of the liability component, the Company applied a discounted cash flow model, which required discounting the contractual cash flows of the convertible notes absent the conversion feature at a risk-adjusted yield that incorporates assumptions of time value of money corresponding to the remaining term of the convertible notes and the credit risk of the Company. The significant assumptions in the fair value calculation included the Convertible Notes’ effective yield and expected volatility. The equity component recorded represents the difference between the proceeds from the issuance of the Convertible Notes and the fair value of the liability component.
|
|
|
|
How We Addressed the Matter in Our Audit
|
|
We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the management’s processes of determining the accounting and the separate recognition of the liability and equity components of the Convertible Notes and management’s use of the significant assumptions in the fair value calculation of the standalone liability component.
Our audit procedures included utilizing a valuation specialist to assist in evaluating the fair value methodology and the significant valuation assumptions applied by the Company in calculating the fair value of the standalone liability component of the Convertible Notes. To test the Convertible Notes’ effective yield and expected volatility, we evaluated completeness and accuracy of the underlying data supporting the significant assumptions and estimates, assessed whether management’s assumptions were consistent with publicly available information and evaluated whether any entity-specific adjustments made were supportable. Additionally, to test the effective yield, we performed a comparative calculation using market data and our internally developed models.
|
/s/ ERNST & YOUNG LLP
|
|
|
February 1, 2020
|
|
February 2, 2019
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
284,613
|
|
|
$
|
210,460
|
|
Accounts receivable, net
|
327,281
|
|
|
321,995
|
|
||
Inventories
|
393,129
|
|
|
468,897
|
|
||
Other current assets
|
59,212
|
|
|
87,343
|
|
||
Total current assets
|
1,064,235
|
|
|
1,088,695
|
|
||
Property and equipment, net
|
288,112
|
|
|
315,558
|
|
||
Goodwill
|
34,777
|
|
|
37,072
|
|
||
Deferred tax assets
|
63,555
|
|
|
57,224
|
|
||
Restricted cash
|
215
|
|
|
535
|
|
||
Operating right-of-use assets
|
851,990
|
|
|
—
|
|
||
Other assets
|
126,078
|
|
|
150,121
|
|
||
|
$
|
2,428,962
|
|
|
$
|
1,649,205
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Current portion of borrowings and finance lease obligations
|
$
|
9,490
|
|
|
$
|
4,315
|
|
Accounts payable
|
232,761
|
|
|
286,657
|
|
||
Accrued expenses
|
204,096
|
|
|
252,392
|
|
||
Current portion of operating lease liabilities
|
192,066
|
|
|
—
|
|
||
Total current liabilities
|
638,413
|
|
|
543,364
|
|
||
Convertible senior notes, net
|
247,363
|
|
|
—
|
|
||
Long-term debt and finance lease obligations
|
32,770
|
|
|
35,012
|
|
||
Deferred rent and lease incentives
|
—
|
|
|
84,893
|
|
||
Long-term operating lease liabilities
|
714,079
|
|
|
—
|
|
||
Other long-term liabilities
|
130,259
|
|
|
127,438
|
|
||
|
1,762,884
|
|
|
790,707
|
|
||
Redeemable noncontrolling interests
|
4,731
|
|
|
4,853
|
|
||
|
|
|
|
||||
Commitments and contingencies (Note 15)
|
|
|
|
||||
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, $.01 par value. Authorized 10,000,000 shares; no shares issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value. Authorized 150,000,000 shares; issued 142,867,947 and 142,707,300 shares, outstanding 65,848,510 and 81,379,660 shares, as of February 1, 2020 and February 2, 2019, respectively
|
658
|
|
|
814
|
|
||
Paid-in capital
|
563,004
|
|
|
523,331
|
|
||
Retained earnings
|
1,130,409
|
|
|
1,077,747
|
|
||
Accumulated other comprehensive loss
|
(139,910
|
)
|
|
(126,179
|
)
|
||
Treasury stock, 77,019,437 and 61,327,640 shares as of February 1, 2020 and February 2, 2019, respectively
|
(914,447
|
)
|
|
(638,486
|
)
|
||
Guess?, Inc. stockholders’ equity
|
639,714
|
|
|
837,227
|
|
||
Nonredeemable noncontrolling interests
|
21,633
|
|
|
16,418
|
|
||
Total stockholders’ equity
|
661,347
|
|
|
853,645
|
|
||
|
$
|
2,428,962
|
|
|
$
|
1,649,205
|
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Product sales
|
$
|
2,592,262
|
|
|
$
|
2,526,500
|
|
|
$
|
2,290,999
|
|
Net royalties
|
85,847
|
|
|
83,194
|
|
|
72,755
|
|
|||
Net revenue
|
2,678,109
|
|
|
2,609,694
|
|
|
2,363,754
|
|
|||
Cost of product sales
|
1,662,401
|
|
|
1,670,090
|
|
|
1,534,906
|
|
|||
Gross profit
|
1,015,708
|
|
|
939,604
|
|
|
828,848
|
|
|||
Selling, general and administrative expenses
|
865,060
|
|
|
835,293
|
|
|
741,641
|
|
|||
European Commission fine
|
—
|
|
|
45,637
|
|
|
—
|
|
|||
Asset impairment charges
|
9,977
|
|
|
6,939
|
|
|
8,479
|
|
|||
Net (gains) losses on lease terminations
|
—
|
|
|
(477
|
)
|
|
11,373
|
|
|||
Earnings from operations
|
140,671
|
|
|
52,212
|
|
|
67,355
|
|
|||
Other income (expense):
|
|
|
|
|
|
||||||
Interest expense
|
(16,129
|
)
|
|
(3,407
|
)
|
|
(2,431
|
)
|
|||
Interest income
|
1,729
|
|
|
4,494
|
|
|
4,106
|
|
|||
Other income (expense), net
|
(2,529
|
)
|
|
(6,591
|
)
|
|
1,241
|
|
|||
|
(16,929
|
)
|
|
(5,504
|
)
|
|
2,916
|
|
|||
|
|
|
|
|
|
||||||
Earnings before income tax expense
|
123,742
|
|
|
46,708
|
|
|
70,271
|
|
|||
Income tax expense
|
22,513
|
|
|
29,542
|
|
|
74,172
|
|
|||
Net earnings (loss)
|
101,229
|
|
|
17,166
|
|
|
(3,901
|
)
|
|||
Net earnings attributable to noncontrolling interests
|
5,254
|
|
|
3,067
|
|
|
3,993
|
|
|||
Net earnings (loss) attributable to Guess?, Inc.
|
$
|
95,975
|
|
|
$
|
14,099
|
|
|
$
|
(7,894
|
)
|
|
|
|
|
|
|
||||||
Net earnings (loss) per common share attributable to common stockholders (Note 19):
|
|
|
|
|
|
||||||
Basic
|
$
|
1.35
|
|
|
$
|
0.17
|
|
|
$
|
(0.11
|
)
|
Diluted
|
$
|
1.33
|
|
|
$
|
0.16
|
|
|
$
|
(0.11
|
)
|
Weighted average common shares outstanding attributable to common stockholders (Note 19):
|
|
|
|
|
|
||||||
Basic
|
70,461
|
|
|
80,146
|
|
|
82,189
|
|
|||
Diluted
|
71,669
|
|
|
81,589
|
|
|
82,189
|
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Net earnings (loss)
|
$
|
101,229
|
|
|
$
|
17,166
|
|
|
$
|
(3,901
|
)
|
Other comprehensive income (loss) (“OCI”):
|
|
|
|
|
|
||||||
Foreign currency translation adjustment
|
|
|
|
|
|
||||||
Gains (losses) arising during the period
|
(17,114
|
)
|
|
(52,733
|
)
|
|
93,416
|
|
|||
Derivative financial instruments designated as cash flow hedges
|
|
|
|
|
|
||||||
Gains (losses) arising during the period
|
9,304
|
|
|
12,652
|
|
|
(23,388
|
)
|
|||
Less income tax effect
|
(988
|
)
|
|
(1,690
|
)
|
|
2,980
|
|
|||
Reclassification to net earnings (loss) for (gains) losses realized
|
(7,904
|
)
|
|
7,118
|
|
|
656
|
|
|||
Less income tax effect
|
908
|
|
|
(712
|
)
|
|
(242
|
)
|
|||
Defined benefit plans
|
|
|
|
|
|
||||||
Net actuarial gains (losses)
|
406
|
|
|
1,733
|
|
|
(2,248
|
)
|
|||
Foreign currency and other adjustments
|
(34
|
)
|
|
311
|
|
|
(269
|
)
|
|||
Less income tax effect
|
(30
|
)
|
|
(528
|
)
|
|
518
|
|
|||
Net actuarial loss amortization
|
446
|
|
|
600
|
|
|
462
|
|
|||
Prior service credit amortization
|
(39
|
)
|
|
(28
|
)
|
|
(27
|
)
|
|||
Less income tax effect
|
(38
|
)
|
|
(76
|
)
|
|
(83
|
)
|
|||
Total comprehensive income (loss)
|
86,146
|
|
|
(16,187
|
)
|
|
67,874
|
|
|||
Less comprehensive income attributable to noncontrolling interests:
|
|
|
|
|
|
||||||
Net earnings
|
5,254
|
|
|
3,067
|
|
|
3,993
|
|
|||
Foreign currency translation adjustment
|
629
|
|
|
(236
|
)
|
|
2,238
|
|
|||
Amounts attributable to noncontrolling interests
|
5,883
|
|
|
2,831
|
|
|
6,231
|
|
|||
Comprehensive income (loss) attributable to Guess?, Inc.
|
$
|
80,263
|
|
|
$
|
(19,018
|
)
|
|
$
|
61,643
|
|
|
Guess?, Inc. Stockholders’ Equity
|
|
|
|
|
||||||||||||||||||||||||||||
|
Common Stock
|
|
|
|
|
|
|
|
Treasury Stock
|
|
|
|
|
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Paid-in
Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
Shares
|
|
Amount
|
|
Nonredeemable
Noncontrolling
Interests
|
|
Total
|
||||||||||||||||
Balance at January 28, 2017
|
84,069,492
|
|
|
$
|
841
|
|
|
$
|
480,435
|
|
|
$
|
1,215,079
|
|
|
$
|
(161,389
|
)
|
|
56,440,482
|
|
|
$
|
(565,744
|
)
|
|
$
|
11,772
|
|
|
$
|
980,994
|
|
Cumulative adjustment from adoption of new accounting guidance
|
—
|
|
|
—
|
|
|
268
|
|
|
942
|
|
|
(1,210
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net earnings (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,894
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,993
|
|
|
(3,901
|
)
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
69,537
|
|
|
—
|
|
|
—
|
|
|
2,238
|
|
|
71,775
|
|
|||||||
Issuance of common stock under stock compensation plans including tax effect
|
1,113,713
|
|
|
10
|
|
|
(1,267
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,257
|
)
|
|||||||
Issuance of stock under Employee Stock Purchase Plan
|
54,300
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
—
|
|
|
(54,300
|
)
|
|
549
|
|
|
—
|
|
|
566
|
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
18,758
|
|
|
94
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18,852
|
|
|||||||
Dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(76,048
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(76,048
|
)
|
|||||||
Share repurchases
|
(3,866,387
|
)
|
|
(38
|
)
|
|
38
|
|
|
—
|
|
|
—
|
|
|
3,866,387
|
|
|
(56,159
|
)
|
|
—
|
|
|
(56,159
|
)
|
|||||||
Noncontrolling interest capital contribution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
11
|
|
|||||||
Noncontrolling interest capital distribution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,358
|
)
|
|
(1,358
|
)
|
|||||||
Balance at February 3, 2018
|
81,371,118
|
|
|
$
|
813
|
|
|
$
|
498,249
|
|
|
$
|
1,132,173
|
|
|
$
|
(93,062
|
)
|
|
60,252,569
|
|
|
$
|
(621,354
|
)
|
|
$
|
16,656
|
|
|
$
|
933,475
|
|
Cumulative adjustment from adoption of new accounting guidance
|
—
|
|
|
—
|
|
|
—
|
|
|
5,829
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,829
|
|
|||||||
Net earnings
|
—
|
|
|
—
|
|
|
—
|
|
|
14,099
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,067
|
|
|
17,166
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(33,117
|
)
|
|
—
|
|
|
—
|
|
|
(236
|
)
|
|
(33,353
|
)
|
|||||||
Issuance of common stock under stock compensation plans including tax effect
|
1,083,613
|
|
|
12
|
|
|
4,994
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,006
|
|
|||||||
Issuance of stock under Employee Stock Purchase Plan
|
43,737
|
|
|
—
|
|
|
283
|
|
|
—
|
|
|
—
|
|
|
(43,737
|
)
|
|
455
|
|
|
—
|
|
|
738
|
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
19,794
|
|
|
179
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,973
|
|
|||||||
Dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(74,533
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(74,533
|
)
|
|||||||
Share repurchases
|
(1,118,808
|
)
|
|
(11
|
)
|
|
11
|
|
|
—
|
|
|
—
|
|
|
1,118,808
|
|
|
(17,587
|
)
|
|
—
|
|
|
(17,587
|
)
|
|||||||
Noncontrolling interest capital distribution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,069
|
)
|
|
(3,069
|
)
|
|||||||
Balance at February 2, 2019
|
81,379,660
|
|
|
$
|
814
|
|
|
$
|
523,331
|
|
|
$
|
1,077,747
|
|
|
$
|
(126,179
|
)
|
|
61,327,640
|
|
|
$
|
(638,486
|
)
|
|
$
|
16,418
|
|
|
$
|
853,645
|
|
Cumulative adjustment from adoption of new accounting guidance
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,684
|
)
|
|
1,981
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
297
|
|
|||||||
Net earnings
|
—
|
|
|
—
|
|
|
—
|
|
|
95,975
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,254
|
|
|
101,229
|
|
|||||||
Other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,712
|
)
|
|
—
|
|
|
—
|
|
|
629
|
|
|
(15,083
|
)
|
|||||||
Issuance of common stock under stock compensation plans including tax effect
|
1,155,166
|
|
|
10
|
|
|
(8,699
|
)
|
|
—
|
|
|
—
|
|
|
(994,519
|
)
|
|
11,490
|
|
|
—
|
|
|
2,801
|
|
|||||||
Issuance of stock under Employee Stock Purchase Plan
|
53,424
|
|
|
1
|
|
|
166
|
|
|
—
|
|
|
—
|
|
|
(53,424
|
)
|
|
616
|
|
|
—
|
|
|
783
|
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
24,079
|
|
|
211
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24,290
|
|
|||||||
Dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
(41,840
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(41,840
|
)
|
|||||||
Share repurchases
|
(16,739,740
|
)
|
|
(167
|
)
|
|
167
|
|
|
—
|
|
|
—
|
|
|
16,739,740
|
|
|
(288,067
|
)
|
|
—
|
|
|
(288,067
|
)
|
|||||||
Noncontrolling interest capital distribution
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(668
|
)
|
|
(668
|
)
|
|||||||
Equity component value of convertible note issuance, net
|
—
|
|
|
—
|
|
|
42,320
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
42,320
|
|
|||||||
Sale of common stock warrant
|
—
|
|
|
—
|
|
|
28,080
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28,080
|
|
|||||||
Purchase of convertible note hedge
|
—
|
|
|
—
|
|
|
(46,440
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(46,440
|
)
|
|||||||
Balance at February 1, 2020
|
65,848,510
|
|
|
$
|
658
|
|
|
$
|
563,004
|
|
|
$
|
1,130,409
|
|
|
$
|
(139,910
|
)
|
|
77,019,437
|
|
|
$
|
(914,447
|
)
|
|
$
|
21,633
|
|
|
$
|
661,347
|
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net earnings (loss)
|
$
|
101,229
|
|
|
$
|
17,166
|
|
|
$
|
(3,901
|
)
|
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
72,188
|
|
|
68,357
|
|
|
63,588
|
|
|||
Amortization of debt discount
|
7,558
|
|
|
—
|
|
|
—
|
|
|||
Amortization of debt issuance costs
|
919
|
|
|
—
|
|
|
—
|
|
|||
Share-based compensation expense
|
24,290
|
|
|
19,973
|
|
|
18,852
|
|
|||
Forward contract (gains) losses
|
(542
|
)
|
|
(138
|
)
|
|
3,087
|
|
|||
Deferred income taxes
|
(5,655
|
)
|
|
5,422
|
|
|
23,802
|
|
|||
Net loss on disposition and impairment of property and equipment and long-term assets
|
11,051
|
|
|
7,267
|
|
|
6,891
|
|
|||
Other items, net
|
5,736
|
|
|
13,297
|
|
|
(7,832
|
)
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable
|
(12,458
|
)
|
|
(41,519
|
)
|
|
(11,656
|
)
|
|||
Inventories
|
65,428
|
|
|
(74,275
|
)
|
|
(28,120
|
)
|
|||
Prepaid expenses and other assets
|
14,739
|
|
|
(27,042
|
)
|
|
(429
|
)
|
|||
Operating lease assets and liabilities, net
|
1,802
|
|
|
—
|
|
|
—
|
|
|||
Accounts payable and accrued expenses
|
(87,423
|
)
|
|
84,531
|
|
|
69,299
|
|
|||
Other long-term liabilities
|
(949
|
)
|
|
8,640
|
|
|
14,789
|
|
|||
Net cash provided by operating activities
|
197,913
|
|
|
81,679
|
|
|
148,370
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Purchases of property and equipment
|
(61,868
|
)
|
|
(108,117
|
)
|
|
(84,655
|
)
|
|||
Proceeds from sale of business and long-term assets
|
4,473
|
|
|
—
|
|
|
1,052
|
|
|||
Acquisition of businesses, net of cash acquired
|
—
|
|
|
(6,404
|
)
|
|
(4,850
|
)
|
|||
Net cash settlement of forward contracts
|
162
|
|
|
1,444
|
|
|
(2,150
|
)
|
|||
Purchases of investments
|
—
|
|
|
(10,451
|
)
|
|
(497
|
)
|
|||
Other investing activities
|
762
|
|
|
—
|
|
|
753
|
|
|||
Net cash used in investing activities
|
(56,471
|
)
|
|
(123,528
|
)
|
|
(90,347
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Proceeds from short-term borrowings
|
137,282
|
|
|
22,728
|
|
|
166
|
|
|||
Repayments of short-term borrowings
|
(132,625
|
)
|
|
(23,024
|
)
|
|
(107
|
)
|
|||
Proceeds from issuance of convertible senior notes
|
300,000
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from issuance of warrants
|
28,080
|
|
|
—
|
|
|
—
|
|
|||
Purchase of convertible note hedges
|
(60,990
|
)
|
|
—
|
|
|
—
|
|
|||
Convertible debt issuance costs
|
(5,276
|
)
|
|
—
|
|
|
—
|
|
|||
Repayment of finance lease obligations and borrowings
|
(3,350
|
)
|
|
(1,983
|
)
|
|
(1,526
|
)
|
|||
Dividends paid
|
(42,135
|
)
|
|
(73,594
|
)
|
|
(76,057
|
)
|
|||
Noncontrolling interest capital contribution
|
—
|
|
|
—
|
|
|
962
|
|
|||
Noncontrolling interest capital distribution
|
(668
|
)
|
|
(3,069
|
)
|
|
(1,358
|
)
|
|||
Issuance of common stock, net of tax withholdings on vesting of stock awards
|
3,584
|
|
|
5,744
|
|
|
(690
|
)
|
|||
Purchase of treasury stock
|
(288,067
|
)
|
|
(23,620
|
)
|
|
(50,127
|
)
|
|||
Net cash used in financing activities
|
(64,165
|
)
|
|
(96,818
|
)
|
|
(128,737
|
)
|
|||
Effect of exchange rates on cash, cash equivalents and restricted cash
|
(3,444
|
)
|
|
(18,020
|
)
|
|
40,746
|
|
|||
Net change in cash, cash equivalents and restricted cash
|
73,833
|
|
|
(156,687
|
)
|
|
(29,968
|
)
|
|||
Cash, cash equivalents and restricted cash at the beginning of the year
|
210,995
|
|
|
367,682
|
|
|
397,650
|
|
|||
Cash, cash equivalents and restricted cash at the end of the year
|
$
|
284,828
|
|
|
$
|
210,995
|
|
|
$
|
367,682
|
|
|
|
|
|
|
|
||||||
Supplemental cash flow data:
|
|
|
|
|
|
||||||
Interest paid
|
$
|
5,248
|
|
|
$
|
2,731
|
|
|
$
|
2,078
|
|
Income taxes paid, net of refunds
|
15,112
|
|
|
40,772
|
|
|
26,907
|
|
|||
|
|
|
|
|
|
||||||
Non-cash investing and financing activity:
|
|
|
|
|
|
||||||
Assets acquired under finance lease obligations
|
$
|
3,070
|
|
|
$
|
1,172
|
|
|
$
|
18,502
|
|
Sale of retail locations
|
3,558
|
|
|
—
|
|
|
—
|
|
Building and building improvements
|
10 to 39 years
|
Furniture, fixtures and equipment
|
2 to 10 years
|
|
Feb 1, 2020
|
|
Feb 2, 2019
|
||||
Trade
|
$
|
309,508
|
|
|
$
|
314,651
|
|
Royalty
|
12,775
|
|
|
5,992
|
|
||
Other
|
13,429
|
|
|
9,892
|
|
||
|
335,712
|
|
|
330,535
|
|
||
Less allowances
|
8,431
|
|
|
8,540
|
|
||
|
$
|
327,281
|
|
|
$
|
321,995
|
|
|
Feb 1, 2020
|
|
Feb 2, 2019
|
||||
Raw materials
|
$
|
399
|
|
|
$
|
881
|
|
Work in progress
|
52
|
|
|
162
|
|
||
Finished goods
|
392,678
|
|
|
467,854
|
|
||
|
$
|
393,129
|
|
|
$
|
468,897
|
|
|
Feb 1, 2020
|
|
Feb 2, 2019
|
||||
Land, buildings and improvements
|
$
|
51,416
|
|
|
$
|
52,039
|
|
Leasehold improvements
|
388,733
|
|
|
387,802
|
|
||
Furniture, fixtures and equipment
|
428,121
|
|
|
410,518
|
|
||
Construction in progress
|
9,510
|
|
|
18,844
|
|
||
Assets under finance leases
|
21,599
|
|
|
19,069
|
|
||
|
899,379
|
|
|
888,272
|
|
||
Less accumulated depreciation and amortization
|
611,267
|
|
|
572,714
|
|
||
|
$
|
288,112
|
|
|
$
|
315,558
|
|
|
Feb 1, 2020
|
|
Feb 2, 2019
|
||||
Aggregate carrying value of property and equipment impaired
|
$
|
8,456
|
|
|
$
|
7,111
|
|
Less property and equipment impairment charges
|
7,546
|
|
|
6,939
|
|
||
Aggregate remaining fair value of property and equipment impaired
|
$
|
910
|
|
|
$
|
172
|
|
|
Americas Retail
|
|
Americas Wholesale
|
|
Europe
|
|
Asia
|
|
Total
|
||||||||||
Goodwill balance at February 3, 2018
|
$
|
1,765
|
|
|
$
|
9,972
|
|
|
$
|
25,125
|
|
|
$
|
1,619
|
|
|
$
|
38,481
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||||
Acquisition
|
—
|
|
|
—
|
|
|
857
|
|
|
—
|
|
|
857
|
|
|||||
Translation adjustments
|
(34
|
)
|
|
(6
|
)
|
|
(2,120
|
)
|
|
(106
|
)
|
|
(2,266
|
)
|
|||||
Goodwill balance at February 2, 2019
|
1,731
|
|
|
9,966
|
|
|
23,862
|
|
|
1,513
|
|
|
37,072
|
|
|||||
Adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||||
Impairment
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,474
|
)
|
|
(1,474
|
)
|
|||||
Translation adjustments
|
(6
|
)
|
|
(1
|
)
|
|
(775
|
)
|
|
(39
|
)
|
|
(821
|
)
|
|||||
Goodwill balance at February 1, 2020
|
$
|
1,725
|
|
|
$
|
9,965
|
|
|
$
|
23,087
|
|
|
$
|
—
|
|
|
$
|
34,777
|
|
|
Feb 1, 2020
|
|
Feb 2, 2019
|
||||
Accrued compensation and benefits
|
$
|
65,821
|
|
|
$
|
64,543
|
|
Allowance for sales returns
|
33,178
|
|
|
33,217
|
|
||
Sales and use taxes, property taxes and other indirect taxes
|
32,185
|
|
|
32,777
|
|
||
Professional and legal fees
|
12,920
|
|
|
57,401
|
|
||
Allowance for markdowns
|
12,562
|
|
|
12,121
|
|
||
Deferred royalties and other revenue
|
8,008
|
|
|
8,260
|
|
||
Income taxes
|
6,842
|
|
|
4,362
|
|
||
Loyalty programs
|
5,783
|
|
|
5,728
|
|
||
Accrued rent
|
4,648
|
|
|
9,000
|
|
||
Gift cards
|
4,469
|
|
|
5,376
|
|
||
Construction costs
|
3,862
|
|
|
5,408
|
|
||
Accrued interest
|
2,449
|
|
|
349
|
|
||
Advertising
|
1,497
|
|
|
1,503
|
|
||
Other
|
9,872
|
|
|
12,347
|
|
||
|
$
|
204,096
|
|
|
$
|
252,392
|
|
|
Feb 1, 2020
|
|
Feb 2, 2019
|
||||
Mortgage debt, maturing monthly through January 2026
|
$
|
19,132
|
|
|
$
|
19,738
|
|
Finance lease obligations
|
16,535
|
|
|
16,702
|
|
||
Borrowings under credit facilities
|
3,957
|
|
|
—
|
|
||
Other
|
2,636
|
|
|
2,887
|
|
||
|
42,260
|
|
|
39,327
|
|
||
Less current installments
|
9,490
|
|
|
4,315
|
|
||
Long-term debt and finance lease obligations
|
$
|
32,770
|
|
|
$
|
35,012
|
|
|
Debt
|
|
Finance Lease
|
|
Total
|
||||||
Fiscal 2021
|
$
|
7,228
|
|
|
$
|
2,273
|
|
|
$
|
9,501
|
|
Fiscal 2022
|
659
|
|
|
2,754
|
|
|
3,413
|
|
|||
Fiscal 2023
|
682
|
|
|
2,533
|
|
|
3,215
|
|
|||
Fiscal 2024
|
705
|
|
|
2,532
|
|
|
3,237
|
|
|||
Fiscal 2025
|
727
|
|
|
1,912
|
|
|
2,639
|
|
|||
Thereafter
|
15,790
|
|
|
4,531
|
|
|
20,321
|
|
|||
Total principal payments
|
25,791
|
|
|
16,535
|
|
|
42,326
|
|
|||
Less unamortized debt issuance costs
|
66
|
|
|
—
|
|
|
66
|
|
|||
Total debt and finance lease obligations
|
$
|
25,725
|
|
|
$
|
16,535
|
|
|
$
|
42,260
|
|
|
Feb 1, 2020
|
|||
Assets
|
Balance Sheet Location
|
|
||
Operating
|
Operating right-of-use assets
|
$
|
851,990
|
|
Finance
|
Property and equipment, net
|
15,972
|
|
|
Total lease assets
|
$
|
867,962
|
|
|
|
|
|
||
Liabilities
|
Balance Sheet Location
|
|
||
Current:
|
|
|
||
Operating
|
Current portion of operating lease liabilities
|
$
|
192,066
|
|
Finance
|
Current portion of borrowings and finance lease obligations
|
2,273
|
|
|
Noncurrent:
|
|
|
||
Operating
|
Long-term operating lease liabilities
|
714,079
|
|
|
Finance
|
Long-term debt and finance lease obligations
|
14,262
|
|
|
Total lease liabilities
|
$
|
922,680
|
|
|
|
Year Ended
Feb 1, 2020 |
||
|
Income Statement Location
|
|
||
Operating lease costs1
|
Cost of product sales
|
$
|
244,222
|
|
Operating lease costs1
|
Selling, general and administrative expenses
|
24,565
|
|
|
Finance lease costs
|
|
|
||
Amortization of leased assets2
|
Cost of product sales
|
2,793
|
|
|
Amortization of leased assets2
|
Selling, general and administrative expenses
|
4,197
|
|
|
Interest on lease liabilities
|
Interest expense
|
1,035
|
|
|
Variable lease costs1
|
Cost of product sales
|
93,534
|
|
|
Variable lease costs1
|
Selling, general and administrative expenses
|
2,227
|
|
|
Short-term lease costs1
|
Cost of product sales
|
344
|
|
|
Short-term lease costs1
|
Selling, general and administrative expenses
|
3,543
|
|
|
Total lease costs
|
$
|
376,460
|
|
1
|
Rental expense for all property and equipment operating leases during fiscal 2019 and fiscal 2018 aggregated to $292.1 million and $272.3 million, respectively, including percentage rent of $67.2 million and $61.2 million, respectively. During fiscal 2019 and fiscal 2018, the Company also recognized insurance, taxes, sales promotion, common area maintenance and certain utility charges that were paid to the landlord totaling $72.3 million and $75.6 million, respectively, related to its operating leases.
|
2
|
Amortization of leased assets related to finance leases are included in depreciation expense within cost of product sales or selling, general and administrative expenses depending on the nature of the asset in the Company’s consolidated statements of income (loss).
|
|
Operating Leases
|
|
|
|
|
||||||||||
|
Non-Related Parties
|
|
Related Parties
|
|
Finance Leases
|
|
Total
|
||||||||
Maturity of Lease Liabilities:
|
|
|
|
|
|
|
|
||||||||
2021
|
$
|
218,109
|
|
|
$
|
2,255
|
|
|
$
|
3,349
|
|
|
$
|
223,713
|
|
2022
|
197,857
|
|
|
257
|
|
|
3,653
|
|
|
201,767
|
|
||||
2023
|
165,367
|
|
|
—
|
|
|
3,249
|
|
|
168,616
|
|
||||
2024
|
137,637
|
|
|
—
|
|
|
3,092
|
|
|
140,729
|
|
||||
2025
|
95,058
|
|
|
—
|
|
|
2,311
|
|
|
97,369
|
|
||||
After 2025
|
186,781
|
|
|
—
|
|
|
4,922
|
|
|
191,703
|
|
||||
Total lease payments
|
1,000,809
|
|
|
2,512
|
|
|
20,576
|
|
|
1,023,897
|
|
||||
Less: Interest
|
97,132
|
|
|
44
|
|
|
4,041
|
|
|
101,217
|
|
||||
Present value of lease liabilities
|
$
|
903,677
|
|
|
$
|
2,468
|
|
|
$
|
16,535
|
|
|
$
|
922,680
|
|
|
Year Ended
Feb 1, 2020 |
||
Supplemental Cash Flow Information:
|
|
||
Cash paid for amounts included in the measurement of lease liabilities
|
|
||
Operating cash flows from operating leases
|
$
|
250,972
|
|
New operating ROU assets obtained in exchange for lease liabilities
|
127,232
|
|
Liability component:
|
|
||
Principal
|
$
|
300,000
|
|
Unamortized debt discount
|
(49,017
|
)
|
|
Unamortized issuance costs
|
(3,620
|
)
|
|
Net carrying amount
|
$
|
247,363
|
|
|
|
||
Equity component, net1
|
$
|
42,320
|
|
1
|
Included in paid-in capital within stockholders’ equity on the consolidated balance sheets and is net of debt issuance costs and deferred taxes.
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Cash dividend declared per share
|
$
|
0.5625
|
|
|
$
|
0.9000
|
|
|
$
|
0.9000
|
|
|
Foreign Currency Translation Adjustment
|
|
Derivative Financial Instruments Designated as Cash Flow Hedges
|
|
Defined Benefit Plans
|
|
Total
|
||||||||
Balance at January 28, 2017
|
$
|
(158,227
|
)
|
|
$
|
5,400
|
|
|
$
|
(8,562
|
)
|
|
$
|
(161,389
|
)
|
Gains (losses) arising during the period
|
91,178
|
|
|
(20,408
|
)
|
|
(1,999
|
)
|
|
68,771
|
|
||||
Reclassification to net loss for losses realized
|
—
|
|
|
414
|
|
|
352
|
|
|
766
|
|
||||
Net other comprehensive income (loss)
|
91,178
|
|
|
(19,994
|
)
|
|
(1,647
|
)
|
|
69,537
|
|
||||
Cumulative adjustment reclassified to retained earnings from adoption of new accounting guidance 1
|
—
|
|
|
225
|
|
|
(1,435
|
)
|
|
(1,210
|
)
|
||||
Balance at February 3, 2018
|
$
|
(67,049
|
)
|
|
$
|
(14,369
|
)
|
|
$
|
(11,644
|
)
|
|
$
|
(93,062
|
)
|
Gains (losses) arising during the period
|
(52,497
|
)
|
|
10,962
|
|
|
1,516
|
|
|
(40,019
|
)
|
||||
Reclassification to net earnings for losses realized
|
—
|
|
|
6,406
|
|
|
496
|
|
|
6,902
|
|
||||
Net other comprehensive income (loss)
|
(52,497
|
)
|
|
17,368
|
|
|
2,012
|
|
|
(33,117
|
)
|
||||
Balance at February 2, 2019
|
$
|
(119,546
|
)
|
|
$
|
2,999
|
|
|
$
|
(9,632
|
)
|
|
$
|
(126,179
|
)
|
Gains (losses) arising during the period
|
(17,743
|
)
|
|
8,316
|
|
|
342
|
|
|
(9,085
|
)
|
||||
Reclassification to net earnings for (gains) losses realized
|
—
|
|
|
(6,996
|
)
|
|
369
|
|
|
(6,627
|
)
|
||||
Net other comprehensive income (loss)
|
(17,743
|
)
|
|
1,320
|
|
|
711
|
|
|
(15,712
|
)
|
||||
Cumulative adjustment reclassified from retained earnings due to adoption of new accounting guidance 2
|
—
|
|
|
1,981
|
|
|
—
|
|
|
1,981
|
|
||||
Balance at February 1, 2020
|
$
|
(137,289
|
)
|
|
$
|
6,300
|
|
|
$
|
(8,921
|
)
|
|
$
|
(139,910
|
)
|
1
|
During the fourth quarter of fiscal 2018, the Company early adopted authoritative guidance which addresses certain stranded income tax effects in accumulated other comprehensive loss resulting from the Tax Reform enacted in December 2017. As a result, the Company recorded a cumulative adjustment to increase retained earnings by $1.2 million with a corresponding reduction to accumulated other comprehensive loss related to the Company’s Supplemental Executive Retirement Plan and its interest rate swap designated as a cash flow hedge based in the U.S.
|
2
|
During the first quarter of fiscal 2020, the Company adopted new authoritative guidance which eliminated the requirement to separately measure and report ineffectiveness for instruments that qualify for hedge accounting and generally requires that the entire change in the fair value of such instruments ultimately be presented in the same line as the respective hedge item. As a result, there is no interest component recognized for the ineffective portion of instruments that qualify for hedge accounting, but rather all changes in the fair value of such instruments are included in other comprehensive income (loss) during the year ended February 1, 2020. Upon adoption of this guidance, the Company reclassified approximately $2.0 million in gains from retained earnings to accumulated other comprehensive loss related to the previously recorded interest component on outstanding instruments that qualified for hedge accounting.
|
|
|
|
|
|
|
|
Location of (Gain) Loss
Reclassified from
Accumulated OCI
into Earnings (Loss)
|
||||||
|
Year Ended
Feb 1, 2020 |
|
Year Ended
Feb 2, 2019 |
|
Year Ended
Feb 3, 2018 |
|
|||||||
Derivative financial instruments designated as cash flow hedges:
|
|
|
|
|
|
|
|
||||||
Foreign exchange currency contracts
|
$
|
(7,776
|
)
|
|
$
|
7,020
|
|
|
$
|
(14
|
)
|
|
Cost of product sales
|
Foreign exchange currency contracts
|
—
|
|
|
201
|
|
|
583
|
|
|
Other income (expense)
|
|||
Interest rate swap
|
(128
|
)
|
|
(103
|
)
|
|
87
|
|
|
Interest expense
|
|||
Less income tax effect
|
908
|
|
|
(712
|
)
|
|
(242
|
)
|
|
Income tax expense
|
|||
|
(6,996
|
)
|
|
6,406
|
|
|
414
|
|
|
|
|||
Defined benefit plans:
|
|
|
|
|
|
|
|
||||||
Net actuarial loss amortization
|
446
|
|
|
600
|
|
|
462
|
|
|
Other income (expense)1
|
|||
Prior service credit amortization
|
(39
|
)
|
|
(28
|
)
|
|
(27
|
)
|
|
Other income (expense)1
|
|||
Less income tax effect
|
(38
|
)
|
|
(76
|
)
|
|
(83
|
)
|
|
Income tax expense
|
|||
|
369
|
|
|
496
|
|
|
352
|
|
|
|
|||
Total reclassifications to net earnings (loss) for (gains) losses realized during the period
|
$
|
(6,627
|
)
|
|
$
|
6,902
|
|
|
$
|
766
|
|
|
|
1
|
During fiscal 2019, in accordance with the adoption of the guidance related to the presentation of net periodic pension costs, reclassification of these items are now included in other income (expense).
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Federal:
|
|
|
|
|
|
||||||
Current
|
$
|
9,270
|
|
|
$
|
16,495
|
|
|
$
|
34,181
|
|
Deferred
|
2,263
|
|
|
4,543
|
|
|
21,595
|
|
|||
State:
|
|
|
|
|
|
||||||
Current
|
1,622
|
|
|
1,408
|
|
|
1,903
|
|
|||
Deferred
|
1,699
|
|
|
1,532
|
|
|
217
|
|
|||
Foreign:
|
|
|
|
|
|
||||||
Current
|
17,166
|
|
|
3,385
|
|
|
7,333
|
|
|||
Deferred
|
(9,507
|
)
|
|
2,179
|
|
|
8,943
|
|
|||
Total
|
$
|
22,513
|
|
|
$
|
29,542
|
|
|
$
|
74,172
|
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
|||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
|||
Computed “expected” tax rate
|
21.0
|
%
|
|
21.0
|
%
|
|
33.7
|
%
|
State taxes, net of federal benefit
|
3.0
|
%
|
|
1.1
|
%
|
|
2.4
|
%
|
Non-U.S. tax expense higher (lower) than federal statutory tax rate1
|
0.0
|
%
|
|
24.2
|
%
|
|
(10.5
|
%)
|
Tax Reform - repatriation tax adjustment2,3
|
—
|
%
|
|
(41.8
|
%)
|
|
32.8
|
%
|
Tax Reform - deferred tax adjustment
|
—
|
%
|
|
—
|
%
|
|
35.4
|
%
|
Swiss tax reform4
|
(6.5
|
%)
|
|
—
|
%
|
|
—
|
%
|
Valuation reserve
|
(0.2
|
%)
|
|
0.5
|
%
|
|
12.9
|
%
|
Unrecognized tax liabilities (benefits)3
|
(6.2
|
%)
|
|
51.3
|
%
|
|
0.8
|
%
|
Share-based compensation
|
0.9
|
%
|
|
0.2
|
%
|
|
1.5
|
%
|
Net tax settlements
|
9.1
|
%
|
|
—
|
%
|
|
—
|
%
|
Prior year tax adjustments
|
(1.8
|
%)
|
|
0.3
|
%
|
|
0.7
|
%
|
Non-deductible permanent differences
|
0.6
|
%
|
|
16.5
|
%
|
|
(4.1
|
%)
|
Foreign derived intangible income
|
(3.4
|
%)
|
|
(10.2
|
%)
|
|
—
|
%
|
Other
|
1.7
|
%
|
|
0.1
|
%
|
|
—
|
%
|
Effective tax rate
|
18.2
|
%
|
|
63.2
|
%
|
|
105.6
|
%
|
1
|
The jurisdictional location of pre-tax income (loss) may represent a significant component of the Company’s effective tax rate as earnings (loss) in foreign jurisdictions are taxed at rates that are different from the U.S. statutory income tax rate. Furthermore, the impact of changes in the jurisdictional location of pre-tax income (loss) on the Company’s effective tax rate will be greater at lower levels of consolidated pre-tax income (loss). These amounts exclude the impact of net changes in valuation allowances, audit and other adjustments related to the Company’s non-U.S. operations, as they are reported separately in the appropriate corresponding line items in the table above.
|
2
|
During fiscal 2018, the Company recognized additional tax expense resulting from the enactment of the Tax Reform to account for the estimated effects of the transitional tax on the deemed repatriation of foreign earnings and reduced deferred tax assets due to lower future U.S. corporate tax rates. During the third quarter of fiscal 2019, the Company completed the preparation of its U.S. federal tax return for fiscal 2018 and concluded, based on the additional information that had become available, that no transition tax was due with respect to the Tax Reform. As a result, during the third quarter of fiscal 2019, the Company reversed a portion of provisional amounts initially recorded during the three months ended February 3, 2018 and recorded a benefit of $19.6 million.
|
3
|
During the fourth quarter of fiscal 2019, the Company concluded based on additional regulatory guidance issued during the quarter related to the Tax Reform, that the Company would owe transition taxes if proposed legislation that clarifies existing tax regulation with respect to the dividends received deduction calculation is passed into law. As a result, during the three months ended February 2, 2019, the Company recorded additional charges due to the Tax Reform of $25.8 million as an uncertain tax position. In fiscal 2020, the Company revised its tax liability estimation and related accrual to $19.9 million.
|
4
|
During fiscal 2020, the Company recognized additional tax benefits resulting from the enactment of the Swiss tax reform. The additional tax benefits related primarily to the recognition of a deferred tax asset associated with the estimated value of a tax basis step-up of the Company’s Switzerland subsidiary’s assets.
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Operations
|
$
|
22,513
|
|
|
29,542
|
|
|
$
|
74,172
|
|
|
Stockholders’ equity1
|
(1,142
|
)
|
|
3,006
|
|
|
(3,173
|
)
|
|||
Total income tax expense
|
$
|
21,371
|
|
|
$
|
32,548
|
|
|
$
|
70,999
|
|
1
|
In April 2019, the Company issued $300 million principal amount of 2.00% convertible senior notes due 2024 (the “Notes”) in a private offering. Paid-in capital includes $1.3 million in net deferred tax assets in connection with the related convertible note hedge transactions and debt discount associated with the Notes. Refer to Note 10 for more information on the convertible senior notes and related transactions.
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Derivative financial instruments designated as cash flow hedges
|
$
|
80
|
|
|
$
|
2,402
|
|
|
$
|
(2,738
|
)
|
Defined benefit plans
|
68
|
|
|
604
|
|
|
(435
|
)
|
|||
Total income tax expense (benefit)1
|
$
|
148
|
|
|
$
|
3,006
|
|
|
$
|
(3,173
|
)
|
1
|
During the fourth quarter of fiscal 2018, the Company early adopted authoritative guidance which addresses certain stranded income tax effects in accumulated other comprehensive loss resulting from the Tax Reform enacted in December 2017. As a result, the Company recorded a cumulative adjustment to increase retained earnings by $1.2 million with a corresponding reduction to accumulated other comprehensive loss related to the Company’s Supplemental Executive Retirement Plan and its interest rate swap designated as a cash flow hedge based in the U.S. The impact from this reclassification on accumulated other comprehensive income (loss) has been excluded from the amounts provided in this table.
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Domestic operations
|
$
|
91,008
|
|
|
$
|
97,885
|
|
|
$
|
39,112
|
|
Foreign operations
|
32,734
|
|
|
(51,177
|
)
|
|
31,159
|
|
|||
Earnings before income tax expense and noncontrolling interests
|
$
|
123,742
|
|
|
$
|
46,708
|
|
|
$
|
70,271
|
|
|
Feb 1, 2020
|
|
Feb 2, 2019
|
||||
Deferred tax assets:
|
|
|
|
|
|||
Operating lease liabilities
|
$
|
187,981
|
|
|
$
|
—
|
|
Net operating losses
|
24,156
|
|
|
23,212
|
|
||
Defined benefit plans
|
12,539
|
|
|
12,883
|
|
||
Convertible senior notes hedge transactions
|
12,284
|
|
|
—
|
|
||
Deferred compensation
|
9,282
|
|
|
9,823
|
|
||
Goodwill amortization
|
7,301
|
|
|
—
|
|
||
Deferred income
|
5,568
|
|
|
4,373
|
|
||
Inventory valuation
|
3,378
|
|
|
1,339
|
|
||
Lease incentives
|
3,272
|
|
|
1,337
|
|
||
Account receivable reserve
|
2,043
|
|
|
2,009
|
|
||
Accrued bonus
|
1,993
|
|
|
2,208
|
|
||
Sales return and other reserves
|
1,981
|
|
|
1,933
|
|
||
Uniform capitalization
|
890
|
|
|
1,419
|
|
||
Rent expense
|
—
|
|
|
7,114
|
|
||
Excess of book over tax depreciation/amortization
|
—
|
|
|
6,638
|
|
||
Other
|
14,296
|
|
|
18,883
|
|
||
Total deferred tax assets
|
286,964
|
|
|
93,171
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Operating right-of-use assets
|
(175,370
|
)
|
|
—
|
|
||
Convertible senior notes debt discount
|
(11,167
|
)
|
|
—
|
|
||
Goodwill amortization
|
—
|
|
|
(2,267
|
)
|
||
Other
|
(6,112
|
)
|
|
(870
|
)
|
||
Valuation allowance
|
(30,760
|
)
|
|
(32,810
|
)
|
||
Net deferred tax assets
|
$
|
63,555
|
|
|
$
|
57,224
|
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Beginning balance
|
$
|
38,751
|
|
|
$
|
16,771
|
|
|
$
|
12,983
|
|
Additions:
|
|
|
|
|
|
||||||
Tax positions related to the prior year
|
3,074
|
|
|
25,822
|
|
|
3,129
|
|
|||
Tax positions related to the current year
|
264
|
|
|
267
|
|
|
222
|
|
|||
Reductions:
|
|
|
|
|
|
||||||
Tax positions related to the prior year
|
(12,658
|
)
|
|
(2,934
|
)
|
|
(355
|
)
|
|||
Tax positions related to the current year
|
—
|
|
|
(449
|
)
|
|
(303
|
)
|
|||
Expiration of statutes of limitations
|
—
|
|
|
—
|
|
|
(206
|
)
|
|||
Foreign currency translation
|
(248
|
)
|
|
(726
|
)
|
|
1,301
|
|
|||
Ending balance
|
$
|
29,183
|
|
|
$
|
38,751
|
|
|
$
|
16,771
|
|
|
Year Ended February 1, 2020
|
||||||||||
|
SERP
|
|
Foreign Pension
Plans
|
|
Total
|
||||||
Service cost
|
$
|
—
|
|
|
$
|
3,211
|
|
|
$
|
3,211
|
|
Interest cost
|
1,924
|
|
|
270
|
|
|
2,194
|
|
|||
Expected return on plan assets
|
—
|
|
|
(310
|
)
|
|
(310
|
)
|
|||
Net amortization of unrecognized prior service credit
|
—
|
|
|
(39
|
)
|
|
(39
|
)
|
|||
Net amortization of actuarial losses
|
62
|
|
|
384
|
|
|
446
|
|
|||
Net periodic defined benefit pension cost
|
$
|
1,986
|
|
|
$
|
3,516
|
|
|
$
|
5,502
|
|
|
|
|
|
|
|
||||||
Unrecognized prior service credit charged to comprehensive income (loss)
|
$
|
—
|
|
|
$
|
(39
|
)
|
|
$
|
(39
|
)
|
Unrecognized net actuarial loss charged to comprehensive income (loss)
|
62
|
|
|
384
|
|
|
446
|
|
|||
Net actuarial gains (losses)
|
449
|
|
|
(43
|
)
|
|
406
|
|
|||
Foreign currency and other adjustments
|
—
|
|
|
(34
|
)
|
|
(34
|
)
|
|||
Related tax impact
|
(118
|
)
|
|
50
|
|
|
(68
|
)
|
|||
Total periodic defined benefit pension cost and other charges to other comprehensive income (loss) and accumulated other comprehensive income (loss)
|
$
|
393
|
|
|
$
|
318
|
|
|
$
|
711
|
|
|
Year Ended February 2, 2019
|
||||||||||
|
SERP
|
|
Foreign Pension
Plans |
|
Total
|
||||||
Service cost
|
$
|
—
|
|
|
$
|
3,039
|
|
|
$
|
3,039
|
|
Interest cost
|
1,887
|
|
|
225
|
|
|
2,112
|
|
|||
Expected return on plan assets
|
—
|
|
|
(303
|
)
|
|
(303
|
)
|
|||
Net amortization of unrecognized prior service credit
|
—
|
|
|
(28
|
)
|
|
(28
|
)
|
|||
Net amortization of actuarial losses
|
187
|
|
|
413
|
|
|
600
|
|
|||
Net periodic defined benefit pension cost
|
$
|
2,074
|
|
|
$
|
3,346
|
|
|
$
|
5,420
|
|
|
|
|
|
|
|
||||||
Unrecognized prior service credit charged to comprehensive income (loss)
|
$
|
—
|
|
|
$
|
(28
|
)
|
|
$
|
(28
|
)
|
Unrecognized net actuarial loss charged to comprehensive income (loss)
|
187
|
|
|
413
|
|
|
600
|
|
|||
Net actuarial gains (losses)
|
2,787
|
|
|
(1,054
|
)
|
|
1,733
|
|
|||
Foreign currency and other adjustments
|
—
|
|
|
311
|
|
|
311
|
|
|||
Related tax impact
|
(686
|
)
|
|
82
|
|
|
(604
|
)
|
|||
Total periodic defined benefit pension cost and other charges to other comprehensive income (loss) and accumulated other comprehensive income (loss)
|
$
|
2,288
|
|
|
$
|
(276
|
)
|
|
$
|
2,012
|
|
|
Year Ended February 3, 2018
|
||||||||||
|
SERP
|
|
Foreign Pension
Plans |
|
Total
|
||||||
Service cost
|
$
|
—
|
|
|
$
|
2,500
|
|
|
$
|
2,500
|
|
Interest cost
|
1,844
|
|
|
147
|
|
|
1,991
|
|
|||
Expected return on plan assets
|
—
|
|
|
(244
|
)
|
|
(244
|
)
|
|||
Net amortization of unrecognized prior service credit
|
—
|
|
|
(27
|
)
|
|
(27
|
)
|
|||
Net amortization of actuarial losses
|
151
|
|
|
311
|
|
|
462
|
|
|||
Net periodic defined benefit pension cost
|
$
|
1,995
|
|
|
$
|
2,687
|
|
|
$
|
4,682
|
|
|
|
|
|
|
|
||||||
Unrecognized prior service credit charged to comprehensive income (loss)
|
$
|
—
|
|
|
$
|
(27
|
)
|
|
$
|
(27
|
)
|
Unrecognized net actuarial loss charged to comprehensive income (loss)
|
151
|
|
|
311
|
|
|
462
|
|
|||
Net actuarial losses
|
(1,092
|
)
|
|
(1,156
|
)
|
|
(2,248
|
)
|
|||
Foreign currency and other adjustments
|
—
|
|
|
(269
|
)
|
|
(269
|
)
|
|||
Related tax impact
|
360
|
|
|
75
|
|
|
435
|
|
|||
Total periodic defined benefit pension cost and other charges to other comprehensive income (loss) and accumulated other comprehensive income (loss)
|
(581
|
)
|
|
(1,066
|
)
|
|
(1,647
|
)
|
|||
Cumulative adjustment reclassified to retained earnings from adoption of new accounting guidance 1
|
(1,435
|
)
|
|
—
|
|
|
(1,435
|
)
|
|||
Total periodic defined benefit pension cost and other charges to accumulated other comprehensive income (loss)
|
$
|
(2,016
|
)
|
|
$
|
(1,066
|
)
|
|
$
|
(3,082
|
)
|
1
|
During the fourth quarter of fiscal 2018, the Company early adopted authoritative guidance which addresses certain stranded income tax effects in accumulated other comprehensive loss resulting from the Tax Reform enacted in December 2017. As a result, the Company recorded a cumulative adjustment to increase retained earnings by $1.4 million with a corresponding reduction to accumulated other comprehensive loss related to the Company’s SERP.
|
|
Feb 1, 2020
|
|
Feb 2, 2019
|
||||||||||||||||||||
|
SERP
|
|
Foreign Pension
Plans |
|
Total
|
|
SERP
|
|
Foreign Pension
Plans |
|
Total
|
||||||||||||
Unrecognized prior service credit
|
$
|
—
|
|
|
$
|
(227
|
)
|
|
$
|
(227
|
)
|
|
$
|
—
|
|
|
$
|
(159
|
)
|
|
$
|
(159
|
)
|
Unrecognized net actuarial loss
|
5,969
|
|
|
5,093
|
|
|
11,062
|
|
|
6,480
|
|
|
5,293
|
|
|
11,773
|
|
||||||
Total included in accumulated other comprehensive loss
|
$
|
5,969
|
|
|
$
|
4,866
|
|
|
$
|
10,835
|
|
|
$
|
6,480
|
|
|
$
|
5,134
|
|
|
$
|
11,614
|
|
|
Feb 1, 2020
|
|
Feb 2, 2019
|
||||||||||||||||||||
|
SERP
|
|
Foreign Pension
Plans |
|
Total
|
|
SERP
|
|
Foreign Pension
Plans |
|
Total
|
||||||||||||
Projected benefit obligation
|
$
|
(51,939
|
)
|
|
$
|
(34,779
|
)
|
|
$
|
(86,718
|
)
|
|
$
|
(52,162
|
)
|
|
$
|
(31,105
|
)
|
|
$
|
(83,267
|
)
|
Plan assets at fair value 1
|
—
|
|
|
28,893
|
|
|
28,893
|
|
|
—
|
|
|
25,358
|
|
|
25,358
|
|
||||||
Net liability 2
|
$
|
(51,939
|
)
|
|
$
|
(5,886
|
)
|
|
$
|
(57,825
|
)
|
|
$
|
(52,162
|
)
|
|
$
|
(5,747
|
)
|
|
$
|
(57,909
|
)
|
1
|
The SERP is a non-qualified pension plan and hence the insurance policies are not considered to be plan assets. Accordingly, the table above does not include the insurance policies with cash surrender values of $67.7 million and $61.7 million as of February 1, 2020 and February 2, 2019, respectively.
|
2
|
The net liability was included in accrued expenses and other long-term liabilities in the Company’s consolidated balance sheets depending on the expected timing of payments.
|
|
Projected Benefit Obligation
|
||||||||||
|
SERP
|
|
Foreign Pension
Plans |
|
Total
|
||||||
Balance at February 3, 2018
|
$
|
54,760
|
|
|
$
|
26,409
|
|
|
$
|
81,169
|
|
Service cost
|
—
|
|
|
3,039
|
|
|
3,039
|
|
|||
Interest cost
|
1,887
|
|
|
225
|
|
|
2,112
|
|
|||
Actuarial (gains) losses
|
(2,787
|
)
|
|
1,054
|
|
|
(1,733
|
)
|
|||
Contributions by plan participants
|
—
|
|
|
2,310
|
|
|
2,310
|
|
|||
Payments
|
(1,698
|
)
|
|
(1,824
|
)
|
|
(3,522
|
)
|
|||
Acquisition
|
—
|
|
|
1,539
|
|
|
1,539
|
|
|||
Foreign currency and other adjustments
|
—
|
|
|
(1,647
|
)
|
|
(1,647
|
)
|
|||
Balance at February 2, 2019
|
$
|
52,162
|
|
|
$
|
31,105
|
|
|
$
|
83,267
|
|
Service cost
|
—
|
|
|
3,211
|
|
|
3,211
|
|
|||
Interest cost
|
1,924
|
|
|
270
|
|
|
2,194
|
|
|||
Actuarial gains
|
(449
|
)
|
|
(82
|
)
|
|
(531
|
)
|
|||
Contributions by plan participants
|
—
|
|
|
2,920
|
|
|
2,920
|
|
|||
Payments
|
(1,698
|
)
|
|
(3,292
|
)
|
|
(4,990
|
)
|
|||
Foreign currency and other adjustments
|
—
|
|
|
647
|
|
|
647
|
|
|||
Balance at February 1, 2020
|
$
|
51,939
|
|
|
$
|
34,779
|
|
|
$
|
86,718
|
|
|
Plan Assets
|
||
Balance at February 3, 2018
|
$
|
21,437
|
|
Actual return on plan assets
|
252
|
|
|
Contributions by employer
|
3,308
|
|
|
Contributions by plan participants
|
2,310
|
|
|
Payments
|
(1,824
|
)
|
|
Acquisition
|
1,186
|
|
|
Foreign currency and other adjustments
|
(1,311
|
)
|
|
Balance at February 2, 2019
|
$
|
25,358
|
|
Actual return on plan assets
|
186
|
|
|
Contributions by employer
|
3,158
|
|
|
Contributions by plan participants
|
2,920
|
|
|
Payments
|
(3,292
|
)
|
|
Foreign currency and other adjustments
|
563
|
|
|
Balance at February 1, 2020
|
$
|
28,893
|
|
|
Year Ended
|
|
Year Ended
|
||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
||||
Beginning balance
|
$
|
4,853
|
|
|
$
|
5,590
|
|
Foreign currency translation adjustment
|
(122
|
)
|
|
(737
|
)
|
||
Ending balance
|
$
|
4,731
|
|
|
$
|
4,853
|
|
|
|
Quarterly Periods Ended1
|
||||||||||||||
Year Ended February 1, 2020
|
|
May 4,
2019 |
|
Aug 3,
2019 |
|
Nov 2,
2019 |
|
Feb 1,
2020 |
||||||||
Net revenue
|
|
$
|
536,691
|
|
|
$
|
683,220
|
|
|
$
|
615,944
|
|
|
$
|
842,254
|
|
Gross profit
|
|
181,949
|
|
|
265,666
|
|
|
229,499
|
|
|
338,594
|
|
||||
Net earnings (loss)
|
|
(20,581
|
)
|
|
26,176
|
|
|
13,585
|
|
|
82,049
|
|
||||
Net earnings (loss) attributable to Guess?, Inc.
|
|
(21,374
|
)
|
|
25,322
|
|
|
12,423
|
|
|
79,604
|
|
||||
Net earnings (loss) per common share attributable to common stockholders2,3,4,5,6:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(0.27
|
)
|
|
$
|
0.36
|
|
|
$
|
0.19
|
|
|
$
|
1.21
|
|
Diluted
|
|
$
|
(0.27
|
)
|
|
$
|
0.35
|
|
|
$
|
0.18
|
|
|
$
|
1.18
|
|
|
|
Quarterly Periods Ended1
|
||||||||||||||
Year Ended February 2, 2019
|
|
May 5,
2018 |
|
Aug 4,
2018 |
|
Nov 3,
2018 |
|
Feb 2,
2019 |
||||||||
Net revenue
|
|
$
|
521,289
|
|
|
$
|
645,871
|
|
|
$
|
605,407
|
|
|
$
|
837,127
|
|
Gross profit
|
|
173,938
|
|
|
239,431
|
|
|
220,143
|
|
|
306,092
|
|
||||
Net earnings (loss)
|
|
(20,987
|
)
|
|
25,734
|
|
|
(12,816
|
)
|
|
25,235
|
|
||||
Net earnings (loss) attributable to Guess?, Inc.
|
|
(21,221
|
)
|
|
25,530
|
|
|
(13,442
|
)
|
|
23,232
|
|
||||
Net earnings (loss) per common share attributable to common stockholders2,4,5,6,7,8,9:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(0.27
|
)
|
|
$
|
0.32
|
|
|
$
|
(0.17
|
)
|
|
$
|
0.29
|
|
Diluted
|
|
$
|
(0.27
|
)
|
|
$
|
0.31
|
|
|
$
|
(0.17
|
)
|
|
$
|
0.28
|
|
1
|
All fiscal quarters presented consisted of 13 weeks.
|
2
|
Per common share amounts for the quarters and full years have been calculated separately. Accordingly, quarterly amounts may not add to the annual amount because of differences in the average common shares outstanding during each period. In addition, holders of the Company’s restricted stock awards are not required to participate in losses of the Company. Therefore, in periods in which the Company reported a net loss, such losses were not allocated to these participating securities, and, as a result, basic and diluted net loss per share were the same in those periods.
|
3
|
Per common share amounts for fiscal 2020 reflect the net impact of share repurchases, cash interest expense and amortization of debt discount and debt issuance costs related to the $300 million convertible senior notes issued during the first quarter of fiscal 2020. Refer to Note 23 and Note 10 for further information regarding share repurchases and the Company’s convertible senior notes.
|
4
|
On January 28, 2019, the Company announced the departure of its former Chief Executive Officer and the terms of his separation. As a result, the Company recorded $5.2 million in separation-related charges during the fourth quarter of fiscal 2019. These charges were comprised of $2.4 million in cash related severance payments and $2.8 million in non-cash stock-based compensation expenses representing the accelerated vesting of previously granted stock awards. The Company also recorded $0.4 million during the fourth quarter of fiscal 2020 mainly related to non-cash stock-based compensation expense resulting from changes in expected performance conditions of certain previously granted stock awards that were no longer subject to service vesting requirements after his departure.
|
5
|
The Company recorded certain professional service and legal costs and related (credits) costs of $0.3 million, $0.4 million, $(1.4) million and $(0.1) million during the first, second, third and fourth quarters of fiscal 2020, respectively. The Company recorded $3.8 million, $2.0 million, $0.1 million and $0.2 million of certain professional service and legal costs and related costs during the first, second, third and fourth quarters of fiscal 2019.
|
6
|
During each of the periods presented, the Company recognized asset impairment charges related primarily to impairment of certain retail locations resulting from under-performance and expected store closures. During the third quarter of fiscal 2020, asset impairment charges also included impairment charges related to certain operating right-of-use assets. During the fourth quarter of fiscal 2020, asset impairment charges also included impairment charges related to goodwill associated with the Company’s China retail reporting unit and impairment charges related to certain operating lease right-of-use assets. The Company recorded asset impairment charges of $1.8 million, $1.5 million, $1.8 million and $4.9 million, respectively, during the first, second, third and fourth quarters of fiscal 2020, respectively. The Company also recorded asset impairment charges of $0.7 million, $3.0 million, $1.3 million and $1.9 million, respectively, during the first, second, third and fourth quarters of fiscal 2019. Refer to Note 5, Note 6 and Note 9 for further information.
|
7
|
The Company recorded net gains on lease terminations of $0.2 million and $0.3 million during the first and fourth quarters of fiscal 2019, respectively. There were no net gains (losses) on lease terminations recognized during the second or third quarters of fiscal 2019. Refer to Note 1 for further information regarding net gains (losses) on lease terminations.
|
8
|
During the third quarter of fiscal 2019, the Company recognized a charge of €37.0 million ($42.4 million) related to a fine expected to be imposed on the Company by the European Commission related to alleged violations of European Union competition rules by the Company. In December of fiscal 2019, the European Commission published its findings and levied a total fine of €39.8 million ($45.6 million), which the Company paid in the first quarter of fiscal 2020. As a result, during the fourth quarter of fiscal 2019, the Company recorded additional charges of €2.8 million ($3.2 million).
|
9
|
During the third quarter of fiscal 2019, the Company revised the provisional amounts previously recorded related to deemed repatriation of foreign earnings under the Tax Reform, and recorded an income tax benefit of $19.6 million. During the fourth quarter of fiscal 2019, the Company concluded based on additional regulatory guidance issued during the quarter, related to the Tax Reform, that the Company would owe transition taxes if proposed legislation that clarifies existing tax regulation with respect to the dividends received deduction calculation is passed into law. As a result, during the three months ended February 2, 2019, the Company recorded additional charges due to the Tax Reform of $25.8 million. Refer to Note 12 for further detail.
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 20201
|
|
Feb 2, 20191
|
|
Feb 3, 20181
|
||||||
Net revenue:
|
|
|
|
|
|
||||||
Americas Retail
|
$
|
811,547
|
|
|
$
|
824,674
|
|
|
$
|
833,077
|
|
Americas Wholesale
|
186,389
|
|
|
170,812
|
|
|
150,366
|
|
|||
Europe
|
1,248,114
|
|
|
1,142,768
|
|
|
998,657
|
|
|||
Asia
|
346,212
|
|
|
388,246
|
|
|
308,899
|
|
|||
Licensing
|
85,847
|
|
|
83,194
|
|
|
72,755
|
|
|||
Total net revenue
|
$
|
2,678,109
|
|
|
$
|
2,609,694
|
|
|
$
|
2,363,754
|
|
Earnings (loss) from operations:
|
|
|
|
|
|
||||||
Americas Retail
|
$
|
22,279
|
|
|
$
|
27,532
|
|
|
$
|
(11,096
|
)
|
Americas Wholesale
|
35,674
|
|
|
29,935
|
|
|
25,845
|
|
|||
Europe
|
134,078
|
|
|
58,298
|
|
|
94,545
|
|
|||
Asia
|
(8,894
|
)
|
|
12,365
|
|
|
14,809
|
|
|||
Licensing
|
74,459
|
|
|
72,986
|
|
|
63,538
|
|
|||
Total segment earnings from operations
|
257,596
|
|
|
201,116
|
|
|
187,641
|
|
|||
Corporate overhead
|
(106,948
|
)
|
|
(96,805
|
)
|
|
(100,434
|
)
|
|||
European Commission fine2
|
—
|
|
|
(45,637
|
)
|
|
—
|
|
|||
Asset impairment charges3
|
(9,977
|
)
|
|
(6,939
|
)
|
|
(8,479
|
)
|
|||
Net gains (losses) on lease terminations4
|
—
|
|
|
477
|
|
|
(11,373
|
)
|
|||
Total earnings from operations
|
$
|
140,671
|
|
|
$
|
52,212
|
|
|
$
|
67,355
|
|
Capital expenditures:
|
|
|
|
|
|
||||||
Americas Retail
|
$
|
19,411
|
|
|
$
|
19,614
|
|
|
$
|
16,899
|
|
Americas Wholesale
|
980
|
|
|
376
|
|
|
1,303
|
|
|||
Europe
|
33,036
|
|
|
56,792
|
|
|
46,419
|
|
|||
Asia
|
6,782
|
|
|
23,458
|
|
|
12,111
|
|
|||
Corporate overhead
|
1,659
|
|
|
7,877
|
|
|
7,923
|
|
|||
Total capital expenditures
|
$
|
61,868
|
|
|
$
|
108,117
|
|
|
$
|
84,655
|
|
1
|
The Company operates on a 52/53-week fiscal year calendar, which ends on the Saturday nearest to January 31 of each year. The results for fiscal 2018 included the impact of an additional week which occurred during the fourth quarter ended February 3, 2018.
|
2
|
During fiscal 2019, the Company recognized a charge of €39.8 million ($45.6 million) for a fine imposed by the European Commission related to alleged violations of European Union competition rules by the Company. The Company paid the full amount of the fine during the first quarter of fiscal 2020.
|
3
|
During each of the years presented, the Company recognized asset impairment charges related primarily to impairment of certain retail locations resulting from under-performance and expected store closures. During fiscal 2020, asset impairment charges also included impairment charges related to goodwill associated with the Company’s China retail reporting unit and impairment charges related to certain operating lease right-of-use assets. Refer to Note 5, Note 6 and Note 9 for further information.
|
4
|
During fiscal 2019, the Company recorded net gain on lease terminations related primarily to the early termination of certain lease agreements in North America. During fiscal 2018, the Company incurred net losses on lease terminations related primarily to the modification of certain lease agreements held with a common landlord in North America. Refer to Note 1 for more information regarding the net gains (losses) on lease terminations.
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Net product sales:
|
|
|
|
|
|
||||||
U.S.
|
$
|
725,938
|
|
|
$
|
722,794
|
|
|
$
|
709,155
|
|
Italy
|
298,124
|
|
|
304,435
|
|
|
289,981
|
|
|||
Canada
|
180,947
|
|
|
187,367
|
|
|
200,364
|
|
|||
Spain
|
152,782
|
|
|
145,819
|
|
|
124,569
|
|
|||
South Korea
|
144,955
|
|
|
162,943
|
|
|
163,382
|
|
|||
France
|
129,505
|
|
|
135,060
|
|
|
125,508
|
|
|||
Other foreign countries
|
960,011
|
|
|
868,082
|
|
|
678,040
|
|
|||
Total product sales
|
2,592,262
|
|
|
2,526,500
|
|
|
2,290,999
|
|
|||
Net royalties
|
85,847
|
|
|
83,194
|
|
|
72,755
|
|
|||
Net revenue
|
$
|
2,678,109
|
|
|
$
|
2,609,694
|
|
|
$
|
2,363,754
|
|
|
Feb 1, 20201
|
|
Feb 2, 2019
|
||||
Long-lived assets:
|
|
|
|
||||
U.S.
|
$
|
352,203
|
|
|
$
|
111,022
|
|
Italy
|
103,594
|
|
|
30,038
|
|
||
Canada
|
43,258
|
|
|
13,225
|
|
||
Spain
|
124,810
|
|
|
31,109
|
|
||
South Korea
|
8,597
|
|
|
9,437
|
|
||
France
|
40,869
|
|
|
18,182
|
|
||
Other foreign countries
|
509,368
|
|
|
173,436
|
|
||
Total long-lived assets
|
$
|
1,182,699
|
|
|
$
|
386,449
|
|
1
|
During the first quarter of fiscal 2020, the Company adopted a comprehensive new lease standard which superseded previous lease guidance. The standard requires a lessee to recognize an asset related to the right to use the underlying asset and a liability that approximates the present value of the lease payments over the term of contracts that qualify as leases under the new guidance. As of February 1, 2020, the Company included operating right-of-use assets of $852.0 million in the disclosure of long-lived assets by geographic region. Refer to Note 2 and Note 9 for more information.
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Net earnings (loss) attributable to Guess?, Inc.
|
$
|
95,975
|
|
|
$
|
14,099
|
|
|
$
|
(7,894
|
)
|
Less net earnings attributable to nonvested restricted stockholders
|
850
|
|
|
756
|
|
|
764
|
|
|||
Net earnings (loss) attributable to common stockholders
|
$
|
95,125
|
|
|
$
|
13,343
|
|
|
$
|
(8,658
|
)
|
|
|
|
|
|
|
||||||
Weighted average common shares used in basic computations
|
70,461
|
|
|
80,146
|
|
|
82,189
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
||||||
Stock options and restricted stock units1
|
1,208
|
|
|
1,443
|
|
|
—
|
|
|||
Weighted average common shares used in diluted computations
|
71,669
|
|
|
81,589
|
|
|
82,189
|
|
|||
Net earnings (loss) per common share attributable to common stockholders:
|
|
|
|
|
|
||||||
Basic
|
$
|
1.35
|
|
|
$
|
0.17
|
|
|
$
|
(0.11
|
)
|
Diluted
|
$
|
1.33
|
|
|
$
|
0.16
|
|
|
$
|
(0.11
|
)
|
1
|
For fiscal 2018, there were 652,494 potentially dilutive shares that were not included in the computation of diluted weighted average common shares and common equivalent shares outstanding because their effect would have been antidilutive given the Company’s net loss.
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||||||
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||||||
Stock options
|
$
|
2,811
|
|
|
$
|
2,563
|
|
|
$
|
2,345
|
|
Stock awards/units
|
21,250
|
|
|
17,187
|
|
|
16,347
|
|
|||
ESPP
|
229
|
|
|
223
|
|
|
160
|
|
|||
Total share-based compensation expense
|
$
|
24,290
|
|
|
$
|
19,973
|
|
|
$
|
18,852
|
|
|
Number of Shares
|
|
Weighted Average
Exercise Price
|
|
Weighted Average
Remaining
Contractual
Term (Years)
|
|
Aggregate
Intrinsic Value ($000’s) |
|||||
Options outstanding at February 2, 2019
|
3,580,909
|
|
|
$
|
20.71
|
|
|
|
|
|
|
|
Granted
|
1,812,800
|
|
|
$
|
17.02
|
|
|
|
|
|
|
|
Exercised
|
(455,781
|
)
|
|
$
|
14.57
|
|
|
|
|
|
|
|
Forfeited
|
(1,145,066
|
)
|
|
$
|
18.82
|
|
|
|
|
|
|
|
Expired
|
(248,775
|
)
|
|
$
|
23.19
|
|
|
|
|
|
|
|
Options outstanding at February 1, 2020
|
3,544,087
|
|
|
$
|
20.10
|
|
|
7.02
|
|
$
|
13,102
|
|
|
|
|
|
|
|
|
|
|||||
Exercisable at February 1, 2020
|
1,537,712
|
|
|
$
|
24.34
|
|
|
4.53
|
|
$
|
4,152
|
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
|||
Valuation Assumptions
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
|||
Risk-free interest rate
|
2.3
|
%
|
|
2.3
|
%
|
|
1.5
|
%
|
Expected stock price volatility
|
48.9
|
%
|
|
46.1
|
%
|
|
37.1
|
%
|
Expected dividend yield
|
3.4
|
%
|
|
4.3
|
%
|
|
8.0
|
%
|
Expected life of stock options
|
4.4 years
|
|
|
4.4 years
|
|
|
4.4 years
|
|
|
Number of
Awards/Units
|
|
Weighted
Average
Grant Date
Fair Value
|
|||
Nonvested at February 2, 2019
|
2,632,169
|
|
|
$
|
16.04
|
|
Granted
|
1,073,555
|
|
|
$
|
19.14
|
|
Vested
|
(960,846
|
)
|
|
$
|
17.27
|
|
Forfeited
|
(647,625
|
)
|
|
$
|
17.27
|
|
Nonvested at February 1, 2020
|
2,097,253
|
|
|
$
|
16.68
|
|
|
Performance-Based Units
|
|
Market-Based Units
|
||||||||||
|
Number of
Units
|
|
Weighted
Average Grant Date Fair Value |
|
Number of
Units
|
|
Weighted
Average Grant Date Fair Value
|
||||||
Nonvested at February 2, 2019
|
1,371,230
|
|
|
$
|
16.44
|
|
|
518,409
|
|
|
$
|
14.28
|
|
Granted1
|
455,339
|
|
|
$
|
18.33
|
|
|
17,557
|
|
|
$
|
15.20
|
|
Vested1
|
(222,308
|
)
|
|
$
|
17.53
|
|
|
(158,014
|
)
|
|
$
|
15.20
|
|
Forfeited
|
(464,238
|
)
|
|
$
|
17.24
|
|
|
(89,750
|
)
|
|
$
|
15.58
|
|
Nonvested at February 1, 2020
|
1,140,023
|
|
|
$
|
16.66
|
|
|
288,202
|
|
|
$
|
13.43
|
|
1
|
As a result of the achievement of certain market-based vesting conditions, there were 17,557 shares that vested in addition to the original target number of shares granted in fiscal 2017.
|
|
Year Ended
|
|
Year Ended
|
||
Valuation Assumptions
|
Feb 2, 2019
|
|
Feb 3, 2018
|
||
Risk-free interest rate
|
2.6
|
%
|
|
1.4
|
%
|
Expected stock price volatility
|
42.1
|
%
|
|
39.7
|
%
|
Expected dividend yield
|
—
|
%
|
|
—
|
%
|
Expected life of market-based awards
|
2.6 years
|
|
|
2.8 years
|
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
|||
Valuation Assumptions
|
Feb 1, 2020
|
|
Feb 2, 2019
|
|
Feb 3, 2018
|
|||
Risk-free interest rate
|
2.0
|
%
|
|
2.0
|
%
|
|
1.0
|
%
|
Expected stock price volatility
|
51.7
|
%
|
|
59.1
|
%
|
|
45.8
|
%
|
Expected dividend yield
|
3.4
|
%
|
|
4.6
|
%
|
|
7.6
|
%
|
Expected life of ESPP options
|
3 months
|
|
|
3 months
|
|
|
3 months
|
|
•
|
Level 1—Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that can be accessed at the measurement date.
|
•
|
Level 2—Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e. interest rates, yield curves, etc.) and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).
|
•
|
Level 3—Unobservable inputs that reflect assumptions about what market participants would use in pricing the asset or liability. These inputs would be based on the best information available, including the Company’s own data.
|
|
|
Fair Value Measurements at Feb 1, 2020
|
|
Fair Value Measurements at Feb 2, 2019
|
||||||||||||||||||||||||||||
Recurring Fair Value Measures
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Foreign exchange currency contracts
|
|
$
|
—
|
|
|
$
|
4,854
|
|
|
$
|
—
|
|
|
$
|
4,854
|
|
|
$
|
—
|
|
|
$
|
4,690
|
|
|
$
|
—
|
|
|
$
|
4,690
|
|
Interest rate swap
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,033
|
|
|
—
|
|
|
$
|
1,033
|
|
|||||||
Total
|
|
$
|
—
|
|
|
$
|
4,854
|
|
|
$
|
—
|
|
|
$
|
4,854
|
|
|
$
|
—
|
|
|
$
|
5,723
|
|
|
$
|
—
|
|
|
$
|
5,723
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Foreign exchange currency contracts
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
77
|
|
|
$
|
—
|
|
|
$
|
77
|
|
Interest rate swap
|
|
—
|
|
|
348
|
|
|
—
|
|
|
348
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Deferred compensation obligations
|
|
—
|
|
|
14,091
|
|
|
—
|
|
|
14,091
|
|
|
—
|
|
|
14,405
|
|
|
—
|
|
|
14,405
|
|
||||||||
Total
|
|
$
|
—
|
|
|
$
|
14,439
|
|
|
$
|
—
|
|
|
$
|
14,439
|
|
|
$
|
—
|
|
|
$
|
14,482
|
|
|
$
|
—
|
|
|
$
|
14,482
|
|
|
|
Derivative
Balance Sheet
Location
|
|
Fair Value at Feb 1, 2020
|
|
Fair Value at Feb 2, 2019
|
||||
ASSETS:
|
|
|
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
||||
Cash flow hedges:
|
|
|
|
|
|
|
||||
Foreign exchange currency contracts
|
|
Other current assets/
Other assets
|
|
$
|
3,987
|
|
|
$
|
4,058
|
|
Interest rate swap
|
|
Other assets
|
|
—
|
|
|
1,033
|
|
||
Total derivatives designated as hedging instruments
|
|
|
|
3,987
|
|
|
5,091
|
|
||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
||||
Foreign exchange currency contracts
|
|
Other current assets/
Other assets |
|
867
|
|
|
632
|
|
||
Total
|
|
|
|
$
|
4,854
|
|
|
$
|
5,723
|
|
LIABILITIES:
|
|
|
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
||||
Cash flow hedges:
|
|
|
|
|
|
|
||||
Foreign exchange currency contracts
|
|
Accrued expenses
|
|
$
|
—
|
|
|
$
|
77
|
|
Interest rate swaps
|
|
Other long-term liabilities
|
|
348
|
|
|
—
|
|
||
Total
|
|
|
|
$
|
348
|
|
|
$
|
77
|
|
|
Year Ended February 1, 2020
|
||||||||
|
Gain (Loss) Recognized in OCI1
|
|
Location of Gain Reclassified from Accumulated OCI into Earnings1
|
|
Gain Reclassified from Accumulated OCI into Earnings
|
||||
Derivatives designated as cash flow hedges:
|
|
|
|
|
|
||||
Foreign exchange currency contracts
|
$
|
10,557
|
|
|
Cost of product sales
|
|
$
|
7,776
|
|
Interest rate swap
|
(1,253
|
)
|
|
Interest expense
|
|
128
|
|
|
Year Ended February 2, 2019
|
||||||||
|
Gain (Loss) Recognized in OCI1
|
|
Location of Gain (Loss) Reclassified from Accumulated OCI into Earnings1
|
|
Gain (Loss) Reclassified from Accumulated OCI into Earnings
|
||||
Derivatives designated as cash flow hedges:
|
|
|
|
|
|
||||
Foreign exchange currency contracts
|
$
|
12,973
|
|
|
Cost of product sales
|
|
$
|
(7,020
|
)
|
Foreign exchange currency contracts
|
2
|
|
|
Other income (expense)
|
|
(201
|
)
|
||
Interest rate swap
|
(324
|
)
|
|
Interest expense
|
|
103
|
|
|
Year Ended February 3, 2018
|
||||||||
|
Gain (Loss) Recognized in OCI1
|
|
Location of Gain (Loss) Reclassified from Accumulated OCI into Loss1
|
|
Gain (Loss) Reclassified from Accumulated OCI into Loss
|
||||
Derivatives designated as cash flow hedges:
|
|
|
|
|
|
||||
Foreign exchange currency contracts
|
$
|
(22,497
|
)
|
|
Cost of product sales
|
|
$
|
14
|
|
Foreign exchange currency contracts
|
(1,163
|
)
|
|
Other income (expense)
|
|
(583
|
)
|
||
Interest rate swap
|
272
|
|
|
Interest expense
|
|
(87
|
)
|
1
|
During the first quarter of fiscal 2020, the Company adopted new authoritative guidance which eliminated the requirement to separately measure and report ineffectiveness for instruments that qualify for hedge accounting and generally requires that the entire change in the fair value of such instruments ultimately be presented in the same line as the respective hedge item. As a result, there is no interest component recognized for the ineffective portion of instruments that qualify for hedge accounting, but rather all changes in the fair value of such instruments are included in other comprehensive income (loss) during fiscal 2020. Upon adoption of this guidance, the Company reclassified $2.0 million in gains from retained earnings to accumulated other comprehensive loss related to the previously recorded interest component on outstanding instruments that qualified for hedge accounting. The Company recognized gains of $3.5 million and $2.7 million resulting from the ineffective portion related to foreign exchange currency contracts in interest income during fiscal 2019 and fiscal 2018, respectively. There was no ineffectiveness recognized related to the interest rate swap during fiscal 2020, fiscal 2019 or fiscal 2018.
|
|
Year Ended Feb 1, 2020
|
|
Year Ended Feb 2, 2019
|
||||
Beginning balance gain (loss)
|
$
|
2,999
|
|
|
$
|
(14,369
|
)
|
Cumulative adjustment from adoption of new accounting guidance1
|
1,981
|
|
|
—
|
|
||
Net gains from changes in cash flow hedges
|
8,316
|
|
|
10,962
|
|
||
Net (gains) losses reclassified to earnings
|
(6,996
|
)
|
|
6,406
|
|
||
Ending balance gain
|
$
|
6,300
|
|
|
$
|
2,999
|
|
1
|
During the first quarter of fiscal 2020, the Company adopted new authoritative guidance which eliminated the requirement to separately measure and report ineffectiveness for instruments that qualify for hedge accounting and generally requires that the entire change in the fair value of such instruments ultimately be presented in the same line as the respective hedge item. As a result, there is no interest component recognized for the ineffective portion of instruments that qualify for hedge accounting, but rather all changes in the fair value of such instruments are included in other comprehensive income (loss) during fiscal 2020. Upon adoption of this guidance, the Company reclassified $2.0 million in gains from retained earnings to accumulated other comprehensive loss related to the previously recorded interest component on outstanding instruments that qualified for hedge accounting.
|
|
|
Location of Gain (Loss)
Recognized in
Earnings (Loss)
|
|
Gain (Loss) Recognized in Earnings (Loss)
|
||||||||||
|
|
|
Year Ended Feb 1, 2020
|
|
Year Ended Feb 2, 2019
|
|
Year Ended Feb 3, 2018
|
|||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
||||||
Foreign exchange currency contracts
|
|
Other income (expense)
|
|
$
|
1,254
|
|
|
$
|
6,785
|
|
|
$
|
(10,511
|
)
|
|
Balance at
Beginning of Period |
|
Costs
Charged to Expenses |
|
Deductions and
Write-offs |
|
Balance
at End of Period |
||||||||
Description
|
|
|
|
|
|
|
|
||||||||
As of February 1, 2020
|
|
|
|
|
|
|
|
||||||||
Allowance for doubtful accounts
|
$
|
8,540
|
|
|
$
|
3,712
|
|
|
$
|
(3,821
|
)
|
|
$
|
8,431
|
|
Allowance for markdowns1
|
12,121
|
|
|
36,979
|
|
|
(36,538
|
)
|
|
12,562
|
|
||||
Allowance for sales returns1
|
33,217
|
|
|
104,801
|
|
|
(104,840
|
)
|
|
33,178
|
|
||||
Total
|
$
|
53,878
|
|
|
$
|
145,492
|
|
|
$
|
(145,199
|
)
|
|
$
|
54,171
|
|
As of February 2, 2019
|
|
|
|
|
|
|
|
||||||||
Allowance for doubtful accounts
|
$
|
13,478
|
|
|
$
|
2,661
|
|
|
$
|
(7,599
|
)
|
|
$
|
8,540
|
|
Allowance for markdowns1
|
10,777
|
|
|
56,697
|
|
|
(55,353
|
)
|
|
12,121
|
|
||||
Allowance for sales returns1
|
27,881
|
|
|
62,293
|
|
|
(56,957
|
)
|
|
33,217
|
|
||||
Total
|
$
|
52,136
|
|
|
$
|
121,651
|
|
|
$
|
(119,909
|
)
|
|
$
|
53,878
|
|
As of February 3, 2018
|
|
|
|
|
|
|
|
||||||||
Allowance for doubtful accounts
|
$
|
13,810
|
|
|
$
|
9,447
|
|
|
$
|
(9,779
|
)
|
|
$
|
13,478
|
|
Allowance for markdowns1
|
2,944
|
|
|
42,485
|
|
|
(34,652
|
)
|
|
10,777
|
|
||||
Allowance for sales returns1
|
20,891
|
|
|
83,593
|
|
|
(76,603
|
)
|
|
27,881
|
|
||||
Total
|
$
|
37,645
|
|
|
$
|
135,525
|
|
|
$
|
(121,034
|
)
|
|
$
|
52,136
|
|
1
|
During the first quarter of fiscal 2019, the Company adopted a new revenue recognition standard on a modified retrospective basis which changed the presentation of allowances for wholesale sales returns and wholesale markdowns to be classified within accrued expenses rather than as a reduction to accounts receivable. During fiscal 2018, these amounts were reported as reductions to accounts receivable. Retail sales returns are reported as accrued expenses.
|
|
Guess?, Inc.
|
|
|
By:
|
/s/ CARLOS ALBERINI
|
|
|
Carlos Alberini
Chief Executive Officer |
|
Date:
|
April 1, 2020
|
/s/ CARLOS ALBERINI
|
|
Chief Executive Officer and Director
(Principal Executive Officer)
|
April 1, 2020
|
Carlos Alberini
|
|
||
|
|
|
|
/s/ KATHRYN ANDERSON
|
|
Chief Financial Officer
(Principal Financial Officer and
Chief Accounting Officer)
|
April 1, 2020
|
Kathryn Anderson
|
|
||
|
|
|
|
/s/ PAUL MARCIANO
|
|
Chief Creative Officer and Director
|
April 1, 2020
|
Paul Marciano
|
|
||
|
|
|
|
/s/ MAURICE MARCIANO
|
|
Chairman and Director
|
April 1, 2020
|
Maurice Marciano
|
|
||
|
|
|
|
/s/ GIANLUCA BOLLA
|
|
Director
|
April 1, 2020
|
Gianluca Bolla
|
|
||
|
|
|
|
/s/ ANTHONY CHIDONI
|
|
Director
|
April 1, 2020
|
Anthony Chidoni
|
|
||
|
|
|
|
/s/ LAURIE ANN GOLDMAN
|
|
Director
|
April 1, 2020
|
Laurie Ann Goldman
|
|
||
|
|
|
|
/s/ CYNTHIA LIVINGSTON
|
|
Director
|
April 1, 2020
|
Cynthia Livingston
|
|
||
|
|
|
|
/s/ DEBORAH WEINSWIG
|
|
Director
|
April 1, 2020
|
Deborah Weinswig
|
|
||
|
|
|
|
/s/ ALEX YEMENIDJIAN
|
|
Director
|
April 1, 2020
|
Alex Yemenidjian
|
|
Exhibit
Number
|
|
Description
|
3.1.
|
|
|
|
||
|
||
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
|
||
|
||
|
||
*†10.28.
|
|
|
*†10.29.
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
†101.INS
|
|
XBRL Instance Document
|
†101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
†101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
†101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
†101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
†101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
†104
|
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
|
*
|
Management Contract or Compensatory Plan
|
†
|
Filed herewith
|
††
|
Furnished herewith
|
1.
|
Definitions. Capitalized terms used herein without definition shall have the meanings assigned to them in the Plan, except where a capitalized term is defined in the Offer Letter between the Company and the Grantee, dated October 23, 2019 (the “Offer Letter”), and this Agreement indicates the definition used in the Offer Letter shall apply for purposes of this Agreement as well.
|
2.
|
Grant of Restricted Stock. The Grantee shall be entitled to purchase 70,000 restricted shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”), pursuant to the terms and conditions of this Agreement (the “Restricted Stock”). This Award is in complete satisfaction of the Grantee’s right to receive a restricted stock award pursuant to Section 4 of the Offer Letter.
|
3.
|
Purchase Price. The Grantee shall pay to the Company, in cash, $0.01 for each share of Restricted Stock (which amount is equal to the par value of each share Restricted Stock) for an aggregate purchase price of $700 (the “Purchase Price”). Such payment of the Purchase Price shall be made to the Company within 30 days after the date hereof.
|
4.
|
Restricted Period. Subject to Sections 7 and 8 below, the Award shall vest and restrictions shall lapse as to 25% of the total number of shares of the Restricted Stock on each of the first, second, third and fourth anniversaries of the Date of Grant; provided that Grantee has been continuously employed with the Company or a Subsidiary from the date hereof through each applicable vesting date (the “Restricted Period”). Notwithstanding the foregoing or anything in Section 17 of the Plan to the contrary, if a Change in Control of the Company (as such term is defined in the Offer Letter) occurs prior to the date the restrictions have lapsed with respect to the Restricted Stock, subject to the Grantee’s continued employment with the Company or a Subsidiary through the closing of the Change
|
5.
|
Continuance of Employment. The vesting schedule requires continued employment with the Company or a Subsidiary through each applicable vesting date as a condition to the vesting of the applicable installment of the Award and the rights and benefits under this Agreement. Employment for only a portion of the vesting period, even if a substantial portion, will not entitle the Grantee to any proportionate vesting or avoid or mitigate a termination of rights and benefits upon or following a termination of employment as provided in Section 8 below or under the Plan.
|
6.
|
Rights of a Shareholder. From and after the Date of Grant and for so long as the Restricted Stock is held by or for the benefit of the Grantee, the Grantee shall have all the rights of a shareholder of the Company with respect to the Restricted Stock, including but not limited to the right to receive dividends, if applicable, and the right to vote such shares.
|
7.
|
Adjustments Upon Specified Events. Upon the occurrence of certain events relating to the Company’s Common Stock contemplated by Section 16(b) of the Plan, the Committee will make adjustments, if appropriate, in the number and kind of securities subject to the Award. If any adjustment is made under Section 16(b) of the Plan, the restrictions applicable to the shares of Restricted Stock shall continue in effect with respect to any consideration, property or other securities (the “Restricted Property” and, for the purposes of this Award Agreement, “Restricted Stock” shall include “Restricted Property,” unless the context otherwise requires) received in respect of such Restricted Stock. Such Restricted Property shall vest at such times and in such proportion as the shares of Restricted Stock to which the Restricted Property is attributable. To the extent that the Restricted Property includes any cash (other than regular cash dividends provided for in Section 6 hereof), such cash shall be invested, pursuant to policies established by the Committee, in interest bearing, FDIC‑insured (subject to applicable insurance limits) deposits of a depository institution selected by the Committee, the earnings on which shall be added to and become a part of the Restricted Property.
|
8.
|
Effect of Cessation of Employment.
|
A.
|
Forfeiture After Certain Events. Unless the Committee determines otherwise in its sole discretion, if the employment of the Grantee by the Company, a Parent or a Subsidiary shall terminate for any reason, whether with or without cause, voluntarily or involuntarily, any of the shares of the Restricted Stock that remain subject to the Restricted Period on the date of the Grantee’s termination of employment shall be forfeited to the Company.
|
B.
|
Return of Shares; Refund of Purchase Price. Upon the occurrence of any forfeiture of shares of Restricted Stock hereunder, such unvested, forfeited shares and related Restricted Property shall be automatically transferred to the Company, without any other action by the Grantee (or the Grantee’s beneficiary or personal representative in the event of the Grantee’s death or Disability, as applicable), and the Company shall refund the portion of the Purchase Price attributable to the forfeited Restricted Stock to the Grantee (or the Grantee’s beneficiary or
|
9.
|
Restrictions on Transfer. Prior to the time that they have become vested pursuant to Section 4 hereof, neither the Restricted Stock, nor any interest therein, amount payable in respect thereof or Restricted Property shall be sold, transferred, pledged, hypothecated or otherwise disposed of by the Grantee; provided, however, that such transfer restrictions shall not apply to (i) transfers to the Company or (ii) transfers by will or the laws of descent and distribution. Grantee agrees that the Restricted Stock will not be sold or otherwise disposed of in any manner that would constitute a violation of any applicable federal or state securities laws.
|
10.
|
Stock Certificates.
|
A.
|
Book Entry Form. The Company shall, in its discretion, issue the shares of Restricted Stock subject to the Award either: (i) in certificate form as provided in Section 10(B) below; or (ii) in book entry form, registered in the name of the Grantee with notations regarding the applicable restrictions on transfer imposed under this Agreement.
|
B.
|
Certificates to be Held by Company; Legend. Any certificates representing shares of Restricted Stock that may be delivered to the Grantee by the Company prior to the lapse of restrictions shall be immediately redelivered by the Grantee to the Company to be held by the Company until the restrictions on such shares shall have lapsed and the shares shall thereby have become vested or the shares represented thereby have been forfeited hereunder. Such certificates shall bear the following legend and any other legends the Company may determine to be necessary or advisable to comply with all applicable laws, rules, and regulations:
|
C.
|
Delivery of Shares Upon Vesting. Promptly after the vesting of any shares of Restricted Stock pursuant to Section 4 hereof and the satisfaction of any and all related tax withholding obligations pursuant to Section 11, the Company shall, as applicable, either remove the notations on any shares of Restricted Stock issued in book entry form which have vested or deliver to the Grantee a certificate or certificates evidencing the number of shares of Restricted Stock which have vested (or, in either case, such lesser number of shares as may result after giving effect to Section 11). The Grantee (or the beneficiary or personal representative of the Grantee in the event of the Grantee’s death or Disability, as the case may be) shall deliver to the Company any representations or other documents or assurances as the Company or its counsel may deem necessary or advisable in order to ensure compliance with all applicable laws, rules and regulations with respect to the grant of the Award and the delivery of the shares of Common Stock in respect thereof. The shares so delivered shall no longer be restricted shares hereunder.
|
D.
|
Stock Power; Power of Attorney. Concurrently with the execution and delivery of this Agreement, the Grantee shall deliver to the Company an executed stock power in the form attached hereto as Exhibit A, in blank, with respect to the Restricted Stock. The Company shall not deliver any share certificates in accordance with this Agreement unless and until the Company shall have received such stock power executed by the Grantee. The Grantee, by acceptance of the Award, shall be deemed to appoint, and does so appoint by execution of this Agreement, the Company and each of its authorized representatives as the Grantee’s attorney(s) in fact to effect any transfer of unvested, forfeited shares (or shares otherwise reacquired by the Company hereunder) to the Company as may be required pursuant to the Plan or this Agreement and to execute such documents as the Company or such representatives deem necessary or advisable in connection with any such transfer.
|
E.
|
Postponement of Issuance. Notwithstanding any other provisions of this Agreement, the issuance or delivery of any shares of Common Stock (whether subject to restrictions or unrestricted) may be postponed for such period as may be required to comply with applicable requirements of any national securities exchange or any requirements under any law or regulation applicable to the issuance or delivery of such shares. The Company shall not be obligated to issue or deliver any shares of Stock if the issuance or delivery thereof shall constitute a violation of any provision of any law or of any regulation of any governmental authority or any national securities exchange.
|
11.
|
Withholding of Tax. Subject to the Company’s ability to comply with applicable laws, rules, and regulations, and unless the Grantee has provided in advance of the applicable withholding event sufficient cash to cover the applicable withholding obligations, upon any vesting of the Restricted Stock, the Company shall automatically withhold and reacquire the appropriate number of whole shares of Restricted Stock, valued at their then fair market value (based on the last closing price (in regular trading) of a share of the Company’s common stock on the New York Stock Exchange), to satisfy any withholding obligations of the Company or its Subsidiaries (including both income tax and the Grantee’s portion of employment tax withholding obligations) with respect to such vesting at the applicable withholding rates. In the event that the Company cannot satisfy such withholding obligations by withholding and reacquiring shares of Restricted Stock, or in the event that the Grantee makes or has made an election pursuant to Section 83(b) of the Code or the occurrence of any other withholding event with respect to the Award, the Company (or a Subsidiary) shall be entitled to require a cash payment by or on behalf of the Grantee and/or to deduct from other compensation payable to the Grantee any sums required by federal, state or local tax law to be withheld with respect to such vesting of any Restricted Stock or such Section 83(b) election or other withholding event.
|
12.
|
Compliance. Grantee hereby agrees to cooperate with the Company, regardless of Grantee’s employment status with the Company, to the extent necessary for the Company to comply with applicable state and federal laws and regulations relating to the Restricted Stock.
|
13.
|
Notices. Any notice required or permitted under this Agreement shall be deemed given when personally delivered, or when deposited in a United States Post Office, postage prepaid, addressed, as appropriate, to the Grantee either at the address on record with the Company or such other address as may be designated by Grantee in writing to the Company; or to the Company, Attention: Stock Plan Administration, 1444 South Alameda Street, Los Angeles, California 90021, or such other address as the Company may designate in writing to the Grantee.
|
14.
|
Plan. The Award and all rights of the Grantee under this Agreement are subject to, and the Grantee agrees to be bound by, all of the terms and conditions of the Plan, incorporated herein by this reference. In the event of a conflict or inconsistency between the terms and conditions of this Agreement and of the Plan, the terms and conditions of the Plan shall govern. The Grantee agrees to be bound by
|
15.
|
Failure to Enforce Not a Waiver. The failure of the Company or the Grantee to enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.
|
16.
|
Governing Law. This Agreement shall be governed by and construed according to the laws of the State of Delaware, without regard to Delaware or other laws that might cause other law to govern under applicable principles of conflicts of law. For purposes of litigating any dispute that arises under this Agreement, the parties hereby submit to and consent to the jurisdiction of the State of California, and agree that such litigation shall be conducted in the courts of Los Angeles County, or the federal courts for the United States for the Central District of California, and no other courts, where this Agreement is made and/or to be performed.
|
17.
|
Electronic Delivery. The Company may, in its sole discretion, decide to deliver any documents related to the Restricted Stock awarded under the Plan or future restricted stock that may be awarded under the Plan by electronic means or request the Grantee’s consent to participate in the Plan by electronic means. The Grantee hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
|
18.
|
Severability. The provisions of this Agreement are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable.
|
19.
|
Section Headings. The section headings of this Agreement are for convenience of reference only and shall not be deemed to alter or affect any provision hereof.
|
20.
|
Entire Agreement. This Agreement and the Plan together constitute the entire agreement and supersede all prior understandings and agreements, written or oral, of the parties hereto with respect to the subject matter hereof. The Plan may be amended pursuant to Section 18 of the Plan. This Agreement may be amended by the Board or the Committee from time to time. Any such amendment must be in writing and signed by the Company. Any such amendment that materially and adversely affects the Grantee’s rights under this Agreement requires the consent of the Grantee in order to be effective with respect to the Award. The Company may, however, unilaterally waive any provision hereof in writing to the extent such waiver does not adversely affect the interests of the Grantee hereunder, but no such waiver shall operate as or be construed to be a subsequent waiver of the same provision or a waiver of any other provision hereof.
|
21.
|
Effect of this Agreement. This Agreement shall be assumed by, be binding upon and inure to the benefit of any successor or successors to all or substantially all of the business or assets of the Company.
|
22.
|
Counterparts. This Agreement may be executed simultaneously in any number of counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.
|
23.
|
Committee’s Powers. No provision contained in this Agreement shall in any way terminate, modify or alter, or be construed or interpreted as terminating, modifying or altering any of the powers, rights
|
24.
|
Section 83(b) Election. The Grantee hereby acknowledged that, with respect to the grant of the Restricted Stock, an election may be filed by the Grantee with the Internal Revenue Service, within 30 days, of the Date of Grant, electing pursuant to Section 83(b) of the Code, to be taxed currently on the fair market value of the Restricted Stock on the Date of Grant.
|
25.
|
Termination of this Agreement. Upon termination of this Agreement, all rights of the Grantee hereunder shall cease.
|
26.
|
Clawback Policy. This Award is subject to the terms of the Company’s recoupment, clawback or similar policy as it may be in effect from time to time, as well as any similar provisions of applicable law, any of which could in certain circumstances require forfeiture of the Award and repayment or forfeiture of any shares of Common Stock or other cash or property received with respect to the Award (including any value received from a disposition of the shares acquired in respect of the Award).
|
27.
|
No Advice Regarding Grant. The Grantee is hereby advised to consult with her own tax, legal and/or investment advisors with respect to any advice the Grantee may determine is needed or appropriate with respect to the Restricted Stock (including, without limitation, to determine the foreign, state, local, estate and/or gift tax consequences with respect to the Award, the advantages and disadvantages of making an election under Section 83(b) of the Code with respect to the Award, and the process and requirements for such an election). Neither the Company nor any of its officers, directors, affiliates or advisors makes any representation (except for the terms and conditions expressly set forth in this Agreement) or recommendation with respect to the Award or the making an election under Section 83(b) of the Code with respect to the Award. In the event the Grantee desires to make an election under Section 83(b) of the Code with respect to the Award, it is the Grantee’s sole responsibility to do so timely. Except for the withholding rights set forth in Section 11 above and Section 19(a) of the Plan, the Grantee is solely responsible for any and all tax liability that may arise with respect to the Award.
|
GUESS?, INC.
|
A DELAWARE CORPORATION
|
By: /S/ Jason T. Miller
|
Jason T. Miller
Its: Secretary
|
|
GRANTEE
/s/ Kathryn Anderson
|
Signature
|
Kathryn Anderson
|
Print Name
|
|
o
|
I am married and have informed my spouse of this equity grant. (Please have your spouse sign the Consent of Spouse section below.)
|
GRANTEE
|
Signature
|
|
Print Name
|
Signature
|
|
Print Name
|
Number of Shares of Common Stock:(1) 130,000 Award Date: December 2, 2019
Exercise Price per Share:(1) $19.1500 Expiration Date:(1)(2) December 2, 2029
Vesting(1)(2) The Option shall become vested as to 25% of the total number of shares of Common Stock
subject to the Option on each of the first, second, third and fourth anniversaries of the Award Date,
subject to the Grantee’s continued employment with the Company or a Subsidiary through each
applicable vesting date. Notwithstanding the foregoing or anything in Section 17 of the Plan to the
contrary, if a Change in Control of the Company (as such term is defined in the Offer Letter between
the Company and the Grantee, dated October 23, 2019 (the “Offer Letter”)) occurs while the Option
is outstanding and unvested, subject to the Grantee’s continued employment with the Company or a
Subsidiary through the closing of the Change in Control, the Option shall accelerate and become fully
vested upon (or if necessary to give effect to the acceleration, immediately prior to) the Change in
Control.
|
“GRANTEE”
|
|
GUESS?, INC.
a Delaware corporation
|
|||
|
|
|
|||
|
|
|
|||
/s/ Kathryn Anderson
|
|
|
|||
Signature
|
|
By:
|
/S/ Jason T. Miller
|
||
|
|
|
|||
Kathryn Anderson
|
|
Print Name:
|
Jason T. Miller
|
||
Print Name
|
|
|
|||
|
|
Title:
|
Secretary
|
|
|
|
Signature of Spouse
|
|
Date
|
(2)
|
Subject to early termination if the Grantee’s employment terminates or pursuant to Section 17 of the Plan.
|
1.
|
Vesting; Limits on Exercise; Incentive Stock Option Status.
|
•
|
Cumulative Exercisability. To the extent that the Option is vested and exercisable, the Grantee has the right to exercise the Option (to the extent not previously exercised), and such right shall continue, until the expiration or earlier termination of the Option.
|
•
|
No Fractional Shares. Fractional share interests shall be disregarded, but may be cumulated.
|
•
|
Minimum Exercise. No fewer than 100 shares of Common Stock (subject to adjustment under Section 16 of the Plan) may be purchased at any one time, unless the number purchased is the total number at the time exercisable under the Option.
|
•
|
Nonqualified Stock Option. The Option is a nonqualified stock option and is not, and shall not be, an incentive stock option within the meaning of Section 422 of the Code.
|
2.
|
Continuance of Employment Required; No Employment/Service Commitment.
|
3.
|
Method of Exercise of Option.
|
|
|
a written notice stating the number of shares of Common Stock to be purchased pursuant to the Option or by the completion of such other administrative exercise procedures as the Committee may require from time to time;
|
|
|
|
|
|
payment in full for the Exercise Price of the shares to be purchased (a) in cash, cashier’s or by electronic funds transfer to the Company; (b) (subject to compliance with all applicable laws, rules, regulations and listing requirements and further subject to such rules as the Committee may adopt as to any non-cash payment) in shares of Common Stock already owned by the Grantee, valued at their Fair Market Value on the exercise date; or (c) through a “cashless exercise” procedure by notice and third party payment in such manner as may be authorized by the Committee pursuant to Section 8(f) of the Plan;
|
|
|
|
|
|
any written statements or agreements required pursuant to Section 19(g) of the Plan; and
|
|
|
|
|
|
satisfaction of the tax withholding provisions of Section 19(a) of the Plan.
|
4.
|
Termination of Option upon a Termination of Grantee’s Employment.
|
•
|
if the Grantee’s employment by the Company or a Subsidiary terminates due to her death, Disability or Retirement, then (a) the Grantee, her personal representative or beneficiary will have twelve (12) months from the Severance Date to exercise the Option (or any portion thereof) to the extent that it was exercisable on the Severance Date; provided that if the Grantee’s employment terminates as a result of Disability or Retirement and she dies during such 12-month period, her beneficiary will have one year from the date of the Grantee’s death to exercise the Option (or any portion thereof) to the extent it was vested on the Grantee’s Severance Date, (b) the Option, to the extent not exercisable on the Severance Date, shall terminate on the Severance Date, and (c) the Option, to the extent exercisable for the 12-month period following the Severance Date (or, if applicable, the 12-month period following the Grantee’s subsequent death) and not exercised during such period, shall terminate at the close of business on the last day of such 12-month period.
|
•
|
if the Grantee’s employment by the Company or a Subsidiary terminates for any reason other than her death, Retirement or Disability, then (a) the Grantee will have sixty (60) days from the Severance Date to exercise the Option (or portion thereof) to the extent that it was exercisable on the Grantee’s Severance Date (b) the Option, to the extent not exercisable on the Severance Date, shall terminate on the Severance Date, and (c) the Option, to the extent exercisable for the sixty (60) day period following the Severance Date and not exercised during such period, shall terminate at the close of business on the last day of the 60-day period.
|
5.
|
Non-Transferability.
|
6.
|
Adjustments Upon Specified Events.
|
7.
|
Possible Termination of Option upon Certain Change in Control Events.
|
8.
|
Compliance.
|
9.
|
Notices.
|
10.
|
Failure to Enforce Not a Waiver.
|
11.
|
Plan.
|
12.
|
Entire Agreement.
|
13.
|
Governing Law.
|
14.
|
Electronic Delivery.
|
15.
|
Effect of this Agreement.
|
16.
|
Counterparts.
|
17.
|
Committee’s Powers.
|
18.
|
Section Headings.
|
19.
|
Clawback Policy.
|
20.
|
No Advice Regarding Grant.
|
Name of Subsidiary
|
|
Country
|
|
Percent
Ownership
|
G-LABS SAGL
|
|
Switzerland
|
|
51%
|
Grupo Guess, S. de R.L. de C.V.
|
|
Mexico
|
|
51%
|
Guess Apparel Andorra SLU
|
|
Andorra
|
|
100%
|
Guess Apparel Spain, S.L.
|
|
Spain
|
|
100%
|
Guess? Asia Limited
|
|
Hong Kong
|
|
100%
|
Guess? Asia Limited Taiwan Branch
|
|
Taiwan
|
|
100%
|
Guess Austria GmbH
|
|
Austria
|
|
100%
|
Guess Australia Pty. Ltd.
|
|
Australia
|
|
100%
|
Guess Bel LLC
|
|
Belarus
|
|
100%
|
Guess Belgium S.P.R.L.
|
|
Belgium
|
|
100%
|
Guess? Bermuda Holdings, LLC
|
|
United States
|
|
100%
|
Guess? Bermuda Holdings, L.P.
|
|
Bermuda
|
|
100%
|
Guess? Brasil Comercio e Distribuicao S.A.
|
|
Brazil
|
|
60%
|
Guess? Canada Corporation
|
|
Canada
|
|
100%
|
Guess Canary Islands, S.L.
|
|
Spain
|
|
51%
|
Guess? CIS LLC
|
|
Russia
|
|
70%
|
Guess? Deutschland GmbH
|
|
Germany
|
|
100%
|
Guess Distribution CIS
|
|
Russia
|
|
100%
|
Guess Distribution RO S.R.L.
|
|
Romania
|
|
100%
|
Guess? Euro-Canada, B.V.
|
|
Netherlands
|
|
100%
|
Guess? Europe, B.V.
|
|
Netherlands
|
|
100%
|
Guess Europe Sagl
|
|
Switzerland
|
|
100%
|
Guess Finland Oy
|
|
Finland
|
|
100%
|
Guess France S.A.S.
|
|
France
|
|
100%
|
Guess? Holdings Korea Limited Liability Company
|
|
Korea
|
|
100%
|
Guess Hungary KFT
|
|
Hungary
|
|
100%
|
Guess? India Private Limited
|
|
India
|
|
100%
|
Guess? IP GP LLC
|
|
United States
|
|
100%
|
Guess? IP Holder L.P.
|
|
United States
|
|
100%
|
Guess? IP LP LLC
|
|
United States
|
|
100%
|
Guess Italia S.r.l.
|
|
Italy
|
|
100%
|
Guess? Japan LLC
|
|
Japan
|
|
100%
|
Guess Kazakhstan LLP
|
|
Kazakhstan
|
|
100%
|
Guess? Licensing, Inc.
|
|
United States
|
|
100%
|
Guess Luxembourg S.a.r.l.
|
|
Luxembourg
|
|
100%
|
Guess Macau, Ltd.
|
|
Macau
|
|
100%
|
Guess Norge AS
|
|
Norway
|
|
100%
|
Guess Poland Sp. z o.o.
|
|
Poland
|
|
100%
|
Guess Portugal, LDA
|
|
Portugal
|
|
60%
|
Guess? Retail, Inc.
|
|
United States
|
|
100%
|
Guess Retail Cyprus Ltd.
|
|
Cyprus
|
|
100%
|
Guess Retail Czech Republic s.r.o.
|
|
Czech Republic
|
|
100%
|
Guess Retail Denmark ApS
|
|
Denmark
|
|
100%
|
Guess Retail Hellas Single Member Private Co
|
|
Greece
|
|
100%
|
Guess Retail (Ireland) Limited
|
|
Ireland
|
|
100%
|
Guess Retail Sweden AB
|
|
Sweden
|
|
100%
|
Guess Service de Mexico S. de R.L. de C.V.
|
|
Mexico
|
|
100%
|
Guess? (Shanghai) Limited
|
|
China
|
|
100%
|
Guess? Singapore Pte. Ltd.
|
|
Singapore
|
|
100%
|
Guess Turkey Perakende Satis Magazacilik Ve Ticaret Limited Sirketi
|
|
Turkey
|
|
100%
|
Guess Turkey Giyim Ithalat ve Dagitim Limited Sirketi
|
|
Turkey
|
|
100%
|
Guess Uruguay SRL
|
|
Uruguay
|
|
100%
|
Guess U.K. Limited
|
|
United Kingdom
|
|
100%
|
Guess? Value LLC
|
|
United States
|
|
100%
|
Guess.com, Inc.
|
|
United States
|
|
100%
|
(1)
|
Registration Statement (Form S-3 No. 333-111895),
|
(2)
|
Registration Statement (Form S-8 No. 333-210411) pertaining to the 2004 Equity Incentive Plan,
|
(3)
|
Registration Statement (Form S-8 No. 333-210410) pertaining to the Nonqualified Deferred Compensation Plan,
|
(4)
|
Registration Statement (Form S-8 No. 333-135079) pertaining to the 2006 Non-Employee Directors’ Stock Grant and Stock Option Plan,
|
(5)
|
Registration Statement (Form S-8 No. 333-129349) pertaining to the Nonqualified Deferred Compensation Plan,
|
(6)
|
Registration Statement (Form S-8 No. 333-121552) pertaining to the 2004 Equity Incentive Plan,
|
(7)
|
Registration Statement (Form S-8 No. 333-81274) pertaining to the 2002 Employee Stock Purchase Plan,
|
(8)
|
Registration Statement (Form S-8 No. 333-10069) pertaining to the 1996 Equity Incentive Plan and the 1996 Non-Employee Directors’ Stock Option Plan,
|
/s/ ERNST & YOUNG LLP
|
1.
|
I have reviewed this annual report on Form 10-K of Guess?, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
April 1, 2020
|
By:
|
/s/ CARLOS ALBERINI
|
|
|
|
Carlos Alberini
Chief Executive Officer |
1.
|
I have reviewed this annual report on Form 10-K of Guess?, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
April 1, 2020
|
By:
|
/s/ KATHRYN ANDERSON
|
|
|
|
Kathryn Anderson
Chief Financial Officer
|
•
|
the Annual Report on Form 10-K of the Company for the period ended February 1, 2020, as filed with the Securities and Exchange Commission (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
|
•
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
April 1, 2020
|
By:
|
/s/ CARLOS ALBERINI
|
|
|
|
Carlos Alberini
Chief Executive Officer |
•
|
the Annual Report on Form 10-K of the Company for the period ended February 1, 2020, as filed with the Securities and Exchange Commission (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
|
•
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date:
|
April 1, 2020
|
By:
|
/s/ KATHRYN ANDERSON
|
|
|
|
Kathryn Anderson
Chief Financial Officer
|