Shares of Canada Goose (GOOS.TO)(GOOS) jumped as much as nearly 12 per cent on Thursday after the company reported quarterly results and said it is seeing no signs of slowing demand amid high inflation.
The luxury parka maker saw sales surge 24 per cent in the three-month period ending July 3, jumping from $56.3 million last year to $69.9 million, as sales in Canada and the United States nearly doubled. While the first quarter is typically the smallest in terms of sales for Canada Goose, chief executive Dani Reiss says the company is on a positive trajectory as it moves into its busier seasons, even amid recession concerns and high inflation.
"As of today, we have not seen any signs of slowing demand," he said on a conference call with analysts on Thursday.
"Canada Goose has grown substantially through every recession, save the first wave of COVID. I believe that this is a testament to our products, grounded in performance and functionality, as well as our brand (and) our luxury positioning."
The company's stock closed the trading day on Thursday on the Toronto Stock Exchange at $28.13 per share, an increase of nearly 2 per cent.
Demand for luxury items has returned in the post-pandemic recovery, even as inflation soars to levels not seen in nearly four decades.
While sales in China, the world's top luxury market, are still down from last year, Canada Goose says it is seeing improvement in the region. Eight out of the company's 16 stores in China were closed in the first quarter due to COVID-19 lockdowns, but all reopened in June.
"We've seen a gradual and meaningful recovery in China and the Chinese market in terms of consumer shopping behaviour, and we expect that to continue," Reiss said.
Sales in North America helped offset slowing demand in China, with U.S. sales surging 69 per cent in the quarter while sales in Canada grew 81 per cent. The company also said the return of tourism has led to sales improvement across Europe, with France leading the way in terms of growth.
Wells Fargo analyst Ike Boruchow wrote in a note to clients on Thursday that the company's growth model has momentum, despite the challenges in China.
"Bigger picture, we continue to believe that Canada Goose's recent quarters have shown strong brand heat trajectory globally," Boruchow wrote.
The company reported a net loss of $62.4 million, or 56 cents per diluted share, compared to a loss last year of $57.5 million, or 46 cents per diluted share. Total sales surpassed analyst expectations, according to IBES data from Refinitiv.
With files from Reuters
Alicja Siekierska is a senior reporter at Yahoo Finance Canada. Follow her on Twitter @alicjawithaj.