Guess?, Inc. (NYSE: GES) has announced a significant expansion of its existing European credit facility, increasing the borrowing capacity from €250 million to €350 million. The facility, managed through the company's wholly-owned Swiss subsidiary, Guess Europe Sagl, now provides additional access to longer-term capital for the company. This expansion reflects the confidence of lenders in Guess?'s strategy and underlines the importance of the European region to the company's overall operations.
One notable aspect of the expanded credit facility is the incorporation of sustainability goals into its terms. The interest rate for the facility is subject to an annual adjustment based on the achievement of specific sustainability targets. These goals are aimed at reducing greenhouse gas emissions, increasing the use of sustainably sourced materials, and boosting the penetration of the company's Guess Eco products. This move aligns financial incentives with Guess?'s commitment to sustainability.
As of the announcement date, Guess?, Inc. directly operated 1,048 retail stores in Europe, the Americas, and Asia, with an additional 533 retail stores operated by partners and distributors worldwide. The company and its partners and distributors are present in approximately 100 countries globally.
The expansion of the European credit facility comes on the heels of Guess?'s recent acquisition of all the operating assets and a 50% interest in the intellectual property assets of New York-based fashion brand Rag & Bone. This acquisition further solidifies Guess?'s position in the American fashion scene, with Rag & Bone's direct stores in the U.S. and U.K., as well as its availability in high-end boutiques, department stores, and e-commerce channels globally.
Carlos Alberini, Chief Executive Officer of Guess?, Inc., emphasized the importance of the European region to the company and noted that the expanded credit facility will provide incremental access to capital while supporting their sustainability goals.
As a result of these announcements, the company's shares have moved -3.7% on the market, and are now trading at a price of $19.64. Check out the company's full 8-K submission here.
