NEW YORK — J. Crew Group Inc. reported that net income for the fourth quarter ended Jan. 28 increased more than threefold to $15.1 million from $4 million in the year-ago period.
The net was pushed down in the year-earlier period due to purchase accounting and costs associated with the $3.1 billion acquisition of the firm by TPG Capital and Leonard Green & Partners in March 2011, taking the company private. Total acquisition costs were $65 million, including $20 million that was recorded in the fourth quarter of 2010.
Fourth-quarter adjusted earnings before interest, taxes, depreciation and amortization advanced to $59.5 million from $51.6 million a year earlier, about a 15 percent gain. That’s considered a better indication of how the company is actually performing since it erases the impact of acquisition, purchase accounting and other items.
Revenues increased 13 percent to $530.9 million, with comparable-store sales increasing 6 percent. Direct sales increased 10 percent to $170.8 million. Gross margin increased to 37.8 percent from 37.4 percent. Gross profit this year reflects the impact of purchase accounting of $2.7 million.
For the year, adjusted EBITDA slipped to $282.2 million from $288.2 million. Pro forma net earnings fell to $51.5 million from $121.5 million in fiscal 2010. Revenues increased 7.7 percent to $1.85 billion from $1.72 billion.
The company also reported compensation for its top executives. Chairman and chief executive officer Millard “Mickey” Drexler earned his usual $200,000 but has options valued at $11.32 million as well as $1.67 million in other compensation. Drexler, 67, signed a new agreement extending his employment through March 7, 2015, subject to automatic one-year renewals. Drexler also has an opportunity to earn an annual bonus award, with a target opportunity of $1.2 million, based on performance metrics set by the board.
When Drexler joined the company in 2003, he invested $10 million of his own money to buy a substantial equity stake. He also paid $1 million for a grant of stock options and a grant of restricted stock. His annual base salary was set at $200,000 in 2003 and has not increased.
With the acquisition, Drexler contributed 2,287,545 shares worth about $99.5 million in exchange for a stake in J. Crew’s new parent company. Drexler owns between 8 and 9 percent of the company’s shares.
President and executive creative director Jenna Lyons received a salary of $1 million, and received stock options valued at $2 million.
Stock and option awards are reported due to Securities and Exchange Commission requirements. The compensation recorded in these categories was not necessarily realized.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion (📷: Dominique Maître)
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)