The decrease in sales was primarily due to the previously announced wind down of the Rebecca Taylor business, and to a lesser extent, a decline in Vince brand sales. Despite this, the company achieved a gross profit of $29.6 million, or 46.2 per cent of net sales, slightly up from 45.5 per cent of net sales for the same period last year, Vince Holding said in a press release.
The company’s selling, general, and administrative expenses were $32.7 million in Q1 FY23, or 51.1 per cent of sales, down from $40.9 million, or 52.2 per cent of sales, in Q1 of fiscal 2022.
US-based apparel company Vince Holding Corp’s net sales dropped 18.3 per cent YoY to $64.1 million in Q1 FY23 due to Rebecca Taylor wind down and a decrease in Vince brand sales.
However, gross profit rose to 46.2 per cent.
Vince segment sales fell 6.3 per cent YoY, while Rebecca Taylor and Parker sales plunged 99.2 per cent YoY in Q1 FY23.
While the company posted a loss from operations of $2.4 million in Q1 FY23, it was notably less than the loss of $5.3 million recorded in the same period last year. Its net loss stood at $0.4 million or $0.03 per share, which is a significant improvement compared to the net loss of $7.2 million or $0.60 per share for Q1 FY22.
At the end of the quarter, the company operated 67 Vince stores, marking a net decrease of 1 store since Q1 of fiscal 2022.
Turning to its specific brands, the Vince segment saw net sales decrease by 6.3 per cent year-on-year (YoY) to $64 million in Q1 FY23, with wholesale segment sales and direct-to-consumer segment sales declining by 3 per cent and 9.4 per cent respectively. However, the brand’s income from operations, excluding unallocated corporate expenses, rose slightly to $9.7 million from $9.4 million in Q1 FY22.
Meanwhile, the Rebecca Taylor and Parker brands experienced a significant net sales drop of 99.2 per cent to $0.1 million, in line with the ongoing wind down of the Rebecca Taylor business. Despite this, the brands managed to turn around their operational performance, reporting an income from operations of $1.2 million, compared to a loss of $1.5 million in the same period last year.
“Our first quarter results were largely in line with our expectations supported by our efforts to streamline our organisation to focus on our core strengths while maintaining a disciplined approach to expense management as we continued to navigate a challenging macro environment. As we look to the remainder of fiscal 2023, while we are maintaining a cautious outlook with respect to the environment, particularly in our wholesale channel, we will continue to focus on driving improved margin performance. With our strengthened balance sheet in place driven by our recent transaction with Authentic Brands Group, we believe we are better positioned to execute our strategic initiatives and prioritise our commitment to improved financial performance over time,” said Jack Schwefel, chief executive officer.
Fibre2Fashion News Desk (DP)
