J. Crew Group Inc. posted a wider first-quarter loss, as well as declines in total revenues and sales at its core J. Crew brand.
For the three months ended May 2, the net loss was $462.4 million from a net loss of $30.1 million a year ago. The quarter was hurt by the impact of a $533.4 million non-cash impairment charge.
Total revenues slipped 1.7 percent to $581.8 million from $592 million, while comparable company sales fell 8 percent on top of a 2 percent decrease in the year ago quarter. Sales at J. Crew decreased 5.2 percent to $508.7 million, but at Madewell jumped 32.6 percent to $61.9 million.
The company said declines at its J. Crew concept were driven primarily by the performance of women’s apparel and accessories, which it said it expects to continue “at least through fiscal 2015.” Given the current and expected future operating results, the company determined that the carrying value of the J. Crew reporting unit exceeded its fair value and recorded an estimated non-cash goodwill impairment charge of $341 million. In addition, the company also took a non-cash impairment charge of $190 million to write down the intangible asset related to the J.Crew trade name.
There were no impairment charges required in connection with its Madewell concept.