Vince Holding Corp. (VNCE) reported earnings on Thur 12 Sept 19 (a/h)

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NEW YORK--(BUSINESS WIRE)--

Vince Holding Corp. (VNCE), a leading global luxury apparel and accessories brand (“Vince” or the “Company”), today reported unaudited results for the second quarter of fiscal year 2019 ended August 3, 2019.

Highlights for the second quarter ended August 3, 2019:

• Net sales increased 13.0% to $71.4 million as compared to $63.1 million in the same period last year.
• Direct-to-Consumer comparable sales grew 7.1%.
• Gross margin rate increased 480 basis points to 48.7%.
• Operating performance improved $4.4 million to $2.0 million compared to an operating loss of $2.4 million in the same period last year.
• Net earnings improved $4.8 million to net income of $1.0 million or $0.08 per diluted share compared to a net loss of $3.8 million or $0.33 per share in the same period last year.

Brendan Hoffman, Chief Executive Officer, commented, “We were very pleased with the exceptional top and bottom line performance in the second quarter reflecting double digit sales growth in both our direct-to-consumer and wholesale channels. Our results are evidence that the multiple initiatives that we have been undertaking are coming together to deliver strong performance in all areas of the business.

We are excited about the momentum in our business as we continue to make progress across our strategic initiatives which include driving global expansion across our retail, e-commerce and wholesale channels as well as increasing brand awareness globally. We believe that we are well positioned within the luxury market to deliver consistent long term profitable growth and enhance shareholder value.”

For the second quarter ended August 3, 2019:

• Net sales increased 13.0% to $71.4 million compared to $63.1 million in the second quarter of fiscal 2018. Wholesale segment sales increased 14.7% to $43.4 million as compared to $37.8 million in the same period last year due primarily to the acceleration of seasonal wholesale shipments. Direct-to-consumer segment sales increased 10.6% to $28.0 million compared to the second quarter of fiscal 2018. Comparable sales increased 7.1%, including e-commerce sales, primarily due to an increase in transactions and average dollar sale.
• Gross profit was $34.7 million, or 48.7% of net sales, compared to gross profit of $27.7 million, or 43.9% of net sales, in the second quarter of fiscal 2018. The 480 basis point increase in gross margin rate was primarily due to product mix, efficiencies in the product development cycle and sourcing initiatives.
• Selling, general, and administrative expenses were $32.8 million, or 45.9% of sales, compared to $30.1 million, or 47.7% of sales, in the second quarter of fiscal 2018. The growth in SG&A dollars was primarily the result of increased compensation and benefits partially related to growth in stores, increased marketing investments, costs associated with enhancements to our ecommerce and Vince Unfold platforms, as well as higher occupancy costs related to new stores.
• Operating income was $2.0 million, or 2.8% of net sales. Operating loss was $2.4 million for the second quarter of fiscal 2018.