American retailer Vince reports $4.8 mn Q1 loss, suspends FY25 outlook
American retailer Vince Holding Corp has reported net sales of $57.9 million in the first quarter (Q1) of fiscal 2025 (FY25) ended May 3, reflecting a decline of 2.1 per cent year-on-year (YoY). The drop was primarily attributed to store closures and remodels, which weighed on the direct-to-consumer (DTC) segment, where sales fell 4.4 per cent to $27.6 million.
The gross profit of the company totalled $29.2 million, representing 50.3 per cent of net sales. The gross margin contraction was driven by higher freight, duty, distribution, and wholesale mix costs. These pressures were partly offset by improved product pricing, lower input costs, and reduced promotional activity, Vince said in a press release.
Vince Holding Corp has reported net sales of $57.9 million in Q1 FY25, down 2.1 per cent YoY, impacted by store closures and a 4.4 per cent drop in DTC sales. Gross profit stood at $29.2 million. The company posted a net loss of $4.8 million and adjusted EBITDA of -$3 million. Vince forecasts Q2 sales to be flat or down 3 per cent, with no full-year guidance due to tariff uncertainties.
Selling, general, and administrative (SG&A) expenses rose to $33.6 million, or 58 per cent of sales. Vince posted an operating loss of $4.4 million, compared to an adjusted loss of $2 million in the same period last year. Adjusted EBITDA came in at -$3 million.
The net loss for the quarter stood at $4.8 million or $0.37 per share, against an adjusted net loss of $3.3 million or $0.26 per share in Q1 FY24. The company did not recognise a tax benefit due to the anticipated non-realisation of year-to-date losses.
Vince ended the quarter with 58 company-operated stores, down by four from a year ago. Segment-wise operating income declined to $8.6 million, compared to $10.1 million in the prior year period.
'I continue to be encouraged by the strong execution and commitment to excellence I see across our organisation, and while we are navigating a challenging environment marked by uncertainty, our first quarter performance was relatively in line with our expectations,' said Brendan Hoffman, chief executive officer (CEO) at Vince .
'As an organisation, we quickly pivoted all efforts in the latter portion of the quarter to develop and put into action mitigation plans in light of the evolving tariff policies. In short order we have diversified our supply chain, negotiated with vendors, and leveraged other opportunities to mitigate near-term costs. As we look ahead, we will continue these efforts along with providing customers a high-quality product offering and an engaging experience across our channels,' added Hoffman.
Looking ahead to Q2 FY25, the company forecasts net sales to be flat or decline by up to 3 per cent. The operating income is projected to range from a 1 per cent loss to a 1 per cent gain of net sales, while adjusted EBITDA is expected to be between 1 and 4 per cent of sales.
Given the uncertainty related to the potential impact and duration of current tariff policy, the company is not providing guidance for the full fiscal 2025, added the release.
Fibre2Fashion News Desk (SG)
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