LXRandCo revenue up 69% in 2017, net loss widens

By

Jennifer Braun

Published
Mar 22, 2018

It’s been a solid year of growth for Montreal-based company LXRandCo, driven by a tripling of its store count, as well as solid online sales.

 
The omnichannel retailer, known for carrying branded vintage luxury handbags and accessories, reported net revenue of $37.1 million for the full-year ended December 31, 2017, up 69 percent.
 
Gross profit increased 49 percent to $10.3 million, or 27.9 percent of net revenue, from $6.9 million.

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Meanwhile, in its fourth quarter, net revenues increased 65 percent to $15.0 million. E-commerce revenue increased to 6.2 percent of net revenue, while gross profit increased 22 percent to $3.6 million, or 24.2 percent of net revenue.
 
The increase in revenue was primarily driven by a larger store network including the opening of 47 "shop-in-shop" stores in the fourth quarter alone, bringing the company’s store count to 133.

The company also added five new retail partners throughout the year, bringing its total number of retail partners to 11.
 
"Expansion of our retail network, complemented by continued growth in our online business, contributed to 65 percent and 70 percent year-over-year increases in fourth quarter and full-year revenue, respectively,” explained CEO Fred Mannella, in a news statement.
 
Despite a strong sales performance, the company still reported a net loss for the year.
 
“Gross margin for the fourth quarter was impacted by a number of items specific to the quarter, including our decision to significantly increase our promotional activity to take advantage of the large number of store openings and busy holiday season to build brand awareness and attract new customers that will benefit us for years to come. In addition, we incurred higher sourcing costs for certain brands in Japan due to increased competitive activity,” explained Mannella.
 
Still, the company is moving forward with its expansion plans and believes it will surpass its year-end target of 205 stores, to as many as 300 stores, by the end of 2018.