Roots reports loss of $9.7 million in Q2
The Canadian company said net loss was $9.7 million, or 23 cents per share, in its second quarter, compared with a loss of $4.1 million, or 10 cents per share a year earlier.
On an adjusted basis, net loss was $6.2 million, or $0.15 per share.
Overall sales for the quarter ended August 3, 2019, totaled $61.7 million, up 2.5 percent from $60.2 million reported during the same period last year.
Still, direct-to-consumer sales were slightly down at $48.2 million, compared to $48.3 million in Q2 2018, while comparable sales fell 2.9 percent, on top of comparable sales growth of 1.1 percent, reported last year.
The decline was attributed to negative store traffic and a delay of product flow to stores.
"Both men's and women's, our two largest product categories, were up year-over-year driven by our increasing success with key seasonal products; we delivered another quarter of better than expected e-commerce growth; and we completed the move from our legacy distribution centre," explained Roots President and CEO, Jim Gabel.
"However, our Q2 financial results fell below our expectations, primarily as a result of negative store traffic and a delay in flow of product to stores as we transitioned to our new DC.”
The Toronto-based company ended the quarter with 116 corporate-retail stores in Canada and eight in the United States, as well as 115 partner-operated stores in Taiwan, 34 in China and one in Hong Kong.
Most recently, it launched its second capsule collection with singer Shawn Mendes, with the opening of a Toronto pop-up experience.
Looking forward, the company is predicting it may fall short of its full year guidance, and is now expecting sales for its 2019 financial year to be at the low end, or fall slightly below, its previously disclosed target range of $358 million to $375 million.
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