Second Quarter highlights:
•Total revenues decreased 2% to $560.9 million. Comparable company sales decreased 5% following a decrease of 8% in the second quarter last year.
•J.Crew sales decreased 7% to $443.1 million. J.Crew comparable sales decreased 8% following a decrease of 9% in the second quarter last year.
•Madewell sales increased 19% to $93.1 million. Madewell comparable sales increased 11% following an increase of 3% in the second quarter last year.
•Gross margin increased to 38.6% from 35.7% in the second quarter last year.
•Selling, general and administrative expenses were $210.1 million, or 37.5% of revenues, compared to $196.5 million, or 34.5% of revenues in the second quarter last year. Excluding transformation costs of $14.0 million and transaction costs of $13.7 million (incurred in connection with the Company’s debt exchange and refinancing), selling, general and administrative expenses were $182.4 million, or 32.5% of revenues this year.
•Operating income was $2.6 million compared to $6.7 million in the second quarter last year. The second quarter this year includes transformation costs of $14.0 million and transaction costs of $13.7 million.
•Net loss was $20.7 million compared to $8.6 million in the second quarter last year. The second quarter this year includes the impact of transformation and transaction costs.
•Adjusted EBITDA increased $24.8 million, or 65%, to $63.1 million from $38.3 million in the second quarter last year.
Jim Brett, Chief Executive Officer, remarked, “Since joining J.Crew in July, I’ve come to a better understanding of how these iconic American brands can be made to play a more meaningful role in our lives. Overall, I am optimistic about the opportunities that lie ahead, particularly when reviewing the strong talent, capabilities and commitment within the organization. The team delivered solid progress on our transformation plan during the second quarter, highlighted by expansion in gross margin and reduced expenses that drove an increase in Adjusted EBITDA. And I am confident about evolving our brand strategy to drive long term profitable growth.”
First Half highlights:
•Total revenues decreased 4% to $1,092.9 million. Comparable company sales decreased 7% following a decrease of 7% in the first half last year.
•J.Crew sales decreased 9% to $871.6 million. J.Crew comparable sales decreased 10% following a decrease of 9% in the first half last year.
•Madewell sales increased 18% to $177.8 million. Madewell comparable sales increased 10% following an increase of 4% in the first half last year.
•Gross margin increased to 37.0% from 35.9% in the first half last year.
•Selling, general and administrative expenses were $420.6 million, or 38.5% of revenues, compared to $388.8 million, or 34.2% of revenues in the first half last year. Excluding transformation costs of $19.6 million, transaction costs of $16.2 million and severance costs of $10.7 million, selling, general and administrative expenses were $374.1 million, or 34.2% of revenues this year.
•Operating loss was $150.7 million compared with operating income of $14.0 million in the first half last year. The operating loss includes (i) non-cash impairment charges of $135.1 million, (ii) transformation costs of $19.6 million, (iii) transaction costs of $16.2 million, and (iv) severance costs of $10.7 million. Operating income last year includes non-cash impairment charges of $5.4 million.
•Net loss was $143.9 million compared to $16.7 million in the first half last year. The net loss this year reflects the impact of non-cash impairment charges, transformation costs, transaction costs, and severance costs. The net loss last year reflects the impact of non-cash impairment charges.
•Adjusted EBITDA increased $6.0 million, or 7%, to $89.7 million from $83.7 million in the first half last year. An explanation of the manner in which the Company uses adjusted EBITDA and a reconciliation to comparable GAAP measures are included in Exhibit (3).
details at: http://www.prnewswire.com/news-releases/jcrew-group-inc-announces-second-quarter-fiscal-2017-results-300508685.html?tc=eml_cleartime