Retail

Apparel Company Canada Goose Eyes Above-Range IPO

Canadian extreme weather luxury apparel company Canada Goose reportedly sought to raise as much as $237 million in its IPO that priced Wednesday (March 15) after market close.

At the upper range of the company’s proposed range, said Bloomberg, Canada Goose could see a market valuation of as much as $1.29 billion. Canada Goose’s IPO additionally marks the first public offering from a luxury goods company in nearly three years.

The latest reports indicate that Canada Goose is actually expected to price its IPO of 20 million shares at 17 Canadian dollars (CA$; about US$12.79), above the expected range between CA$14 and CA$16, according to a source cited by CNBC.

Canada Goose currently sells its merchandise through select outdoor, luxury and online retailers and distributors in 36 countries as well as on their eCommerce sites in Canada, the U.S., the U.K. and France. It also recently beefed up its physical retail presence by opening locations in Toronto and New York City.

Canada Goose’s revenue hit $218.6 million in fiscal year (FY) 2016, according to numbers from the company’s F-1. Gross profit for FY 2016 was about $109 million, representing a gross margin of 50.1 percent and a net income of $19.9 million.

Additionally, the company reported revenue growth at a 38.3 percent compound annual growth rate (CAGR) and growth in net income at a 196.0 percent CAGR from FY 2014 to 2016. In the same period, Canada Goose reported that its gross margin grew from 38.6 percent in FY 2014.

While less than a third of the apparel retailer’s revenue came from sources outside the U.S. and Canada in fiscal year 2016, international sales rates have doubled since two years ago.

“There’s plenty of room internationally because the Canadian brand has legs,” BrandSimple founder Allen Adamson told Bloomberg, “and I’m sure they’ll be selling as many Canada Goose coats in Berlin as Manhattan.”

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