Roots sale jump 13% in Q3
Roots announced a sales jump of 13 percent in its latest quarter on Tuesday, in its first quarterly report since completing an initial public offering in October.
The Canadian retailer saw sales reach $89.7 million in the third quarter of fiscal 2016, ended October 28, 2017.
Direct-to-consumer sales were up 14 percent at $77.2 million, driven primarily by a comparable sales growth of 10.1 percent, and the opening of four new corporate retail stores since the same period last year.
The company has also renovated or expanded five corporate retail stores since last year, which included a new store concept unveiled at Yorkdale Shopping Centre in Toronto this summer.
Meanwhile, sales in the partners and other segment were $12.5 million, up 7.1 percent.
Adjusted EBITDA increased by 20.5 percent to $16.3 million. Gross profit was up by 16.9 percent to $49.3 million from $42.1 million.
"We are pleased to have delivered strong financial results for the third quarter, which demonstrates the strength of our brand and the early momentum of our operational investments and strategic growth initiatives,” said Jim Gabel, President and CEO of Roots Corporation.
“In addition to delivering 10.1 percent comparable sales growth, we continued to make progress on our growth plans, including the expansion of our Canadian and international footprint, and increased penetration of our e-commerce business."
The company’s shares were priced at $12 in its public offering, below its original set price range of $14 to $16 per share. It was seeking to raise about C$200 million.
"Our recent IPO was a significant milestone for Roots and we are very excited to take this important step forward in our development. While we are very proud of all that we have achieved thus far, we believe we are in the very early innings of unlocking our potential to capture the tremendous opportunity that lies ahead," Gabel added.
For fiscal 2019, the company expects to make sales in the range of $410 million to $450 million, adjusted EBITDA of $61 million to $68 million, and adjusted net income of $35 million to $40 million.
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