Vince bounces back in Q2
Apparel company Vince on Thursday reported that second quarter net sales rose 3.8% to $63.1 million from $60.8 million in the year-ago quarter. Wholesale segment sales fell 3.6% to $37.8 million year over year, as expected, due to streamlining of its full-price department store business, and direct-to-consumer segment sales rose 17.2% to $25.3 million. Comparable sales including e-commerce rose 14.4%, according to a company press release.
Operating loss in the quarter reached $2.4 million, down from $8.9 million a year ago, and net loss was $3.8 million, down from $10.1 million, the company also said. Vince ended the quarter with 58 company-run stores, a net increase of three since last year.
Vince also ended the quarter with $5.3 million in cash and cash equivalents and $64.4 million in debt, trimming it by $9.1 million through $16 million in loan payments partially offset by a revolving credit increase, the company also said. On Aug. 21, Vince refinanced its debt with a $27.5 million senior secured term loan facility and a $80 million senior secured revolving credit facility, according to the release.
Although Vince, like other upscale apparel brands, is shaking up its department store channel, the company isn't entirely abandoning that sector. "Our best performing stores remain those in close proximity to department store doors that we exited. We also saw another quarter of strong sell-through within the department store channel, positioning us for continued momentum and improved profitability in this segment," CEO Brendan Hoffman said in a statement.
The company's ability to refinance its debt and collect a new loan reflects a certain amount of confidence in the brand, which has struggled along with many of its apparel retail peers despite its efforts to adapt. Retail Dive late last year pegged it as a company that could file for bankruptcy, following its "going concern" warning" last April when Hoffman told investors the company had failed to adequately meet shoppers' expectations for quick turnarounds on new designs. Last May, the company also faced the prospect of a stock de-listing.
Its recovery appears to be gaining traction. The company is seeing results from its efforts to interact with customers online, which has led to e-commerce growth, and sales in physical stores have improved. Vince has also revamped some stores, opened a store in Honolulu and added men's fashions to its flagship Madison Avenue store in New York City. Vince also began selling a collection of third-party accessories, including jewelry, art, bags, sunglasses and home décor items online and in Los Angeles and New York stores.
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