Vince Holding Corp (VNCE) has reported 42.64 percent plunge in profit for the quarter ended Oct. 29, 2016. The company has earned $3.38 million, or $0.07 a share in the quarter, compared with $5.89 million, or $0.16 a share for the same period last year. On an adjusted basis, net profit for the quarter was stable at $4.82 million, or $0.13 a share, when compared with the last year period. Revenue during the quarter dropped 6.04 percent to $75.97 million from $80.86 million in the previous year period. Gross margin for the quarter expanded 49 basis points over the previous year period to 49.96 percent. Total expenses were 92.02 percent of quarterly revenues, up from 84.74 percent for the same period last year. That has resulted in a contraction of 728 basis points in operating margin to 7.98 percent.
Operating income for the quarter was $6.06 million, compared with $12.34 million in the previous year period.
However, the adjusted operating income for the quarter was stable at $10.52 million when compared with the prior year period. At the same time, adjusted operating margin improved 84 basis points in the quarter to 13.85 percent from 13.01 percent in the last year period.
Brendan Hoffman, Chief Executive Officer, commented, “We were pleased with the initial favorable response to our fall collection which was developed under the leadership of our returning founders. The feedback from our wholesale partners was also highly encouraging, and even more importantly, Rea and the team are energized by how much we’ve learned from this delivery and are excited to move forward. Our third quarter sales results are reflective of continued challenges in the retail industry, in addition to the impact of warm weather, although we managed to meaningfully expand our gross margin rate as we focused on full-price selling. Despite the continuation of macro headwinds, we remain confident in our belief that we are taking the brand in the right direction with a fashion assortment that combines urban utility and modern effortless style. Looking ahead, while we are reducing our guidance, we continue to see significant long term growth opportunity as we gain market share within the wholesale channel and expand our direct to consumer presence both in our retail stores and online.”
VINCE HOLDING forecasts revenue to be in the range of $280 million to $290 million for fiscal year 2016.
Working capital increases sharply
Vince Holding Corp has recorded an increase in the working capital over the last year. It stood at $40.72 million as at Oct. 29, 2016, up 252.74 percent or $29.18 million from $11.54 million on Oct. 31, 2015. Current ratio was at 2.02 as on Oct. 29, 2016, up from 1.19 on Oct. 31, 2015. Cash conversion cycle (CCC) has decreased to 9 days for the quarter from 47 days for the last year period. Days sales outstanding were almost stable at 24 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 41 days for the quarter compared with 100 days for the previous year period. At the same time, days payable outstanding went down to 74 days for the quarter from 76 for the same period last year.
Debt comes down significantly
Vince Holding Corp has recorded a decline in total debt over the last one year. It stood at $50.74 million as on Oct. 29, 2016, down 32.55 percent or $24.48 million from $75.22 million on Oct. 31, 2015. VINCE HOLDING has recorded a decline in long-term debt over the last one year. It stood at $50.74 million as on Oct. 29, 2016, down 32.55 percent or $24.48 million from $75.22 million on Oct. 31, 2015. Total debt was 12.80 percent of total assets as on Oct. 29, 2016, compared with 20.03 percent on Oct. 31, 2015. Debt to equity ratio was at 0.34 as on Oct. 29, 2016, down from 0.99 as on Oct. 31, 2015. Interest coverage ratio deteriorated to 5.93 for the quarter from 8.64 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
