Vince managed to cuts its losses for the second quarter despite a steep decline in sales due to the pandemic.
The net loss in the quarter ended Aug. 1 declined to $15.1 million, or $1.28 per share, compared to a net loss of $19.5 million, or $1.67 per share, in the same period last year.
Excluding non-cash asset impairment charges, net income in the second quarter of fiscal 2019 was $590,000 or $0.05 per diluted share.
Net sales decreased 59.9 percent to $37 million in the second quarter of 2020, as compared to $92.2 million in the same period last year.
Gross margin rate was 36 percent, compared to 47 percent in the same period last year.
The loss from operations was $14 million, compared to an operating loss of $18.4 million in the same period last year. Excluding non-cash asset impairment charges, income from operations in the second quarter of fiscal 2019 was $1.7 million.
The big gain in c-commerce sales for the Vince brand, the interim ceo said, was driven by “heightened promotions as we move through inventory as well as a positive response to our merchandise assortment as our casual luxury offerings across categories are well-suited for the stay-at-home lifestyle. We have re-prioritized our growth strategies to align with the near-term environment with a focus on e-commerce initiatives, maintaining our strong connection with our customers and expanding our reach through our direct-to-consumer and wholesale presence. For Rebecca Taylor, we are excited about the anticipation among our wholesale partners as we prepare to relaunch the brand and return to our elevated casual and feminine flirty roots.”
Stefko continued, “In terms of liquidity, we continued to execute cash savings strategies across expense, capital expenditure and working capital areas to align with the recovery of the business. Overall, we remain optimistic about our long-term potential as we leverage our iconic brands to drive global sales growth and enhanced profitability.”
Selling, general, and administrative expenses, excluding the non-cash impact of goodwill and intangible asset impairment charges, long-lived asset or other finite-lived intangible asset impairment charges, were $27.3 million, or 73.9 percent of sales, compared to $41.6 million, or 45.1 percent of sales, in the second quarter of fiscal 2019. The decrease in SG&A dollars was primarily the result of lower payroll and compensation expense, reduced marketing spend, decreased depreciation and amortization expense due to previous impairments as well as the streamlining of other operating costs.
The company ended the quarter with 68 company-operated Vince and Rebecca Taylor stores, a net increase of two stores since the second quarter of fiscal 2019.
By brand, Vince last quarter posted a loss from operations, excluding unallocated corporate expenses, of $1.1 million, compared to income from operations of $15.4 million in the same period last year. Net sales decreased 54.9 percent to $32.2 million compared to the second quarter of fiscal 2019. Wholesale sales decreased 60.5 percent to $17.2 million. Direct-to-consumer sales decreased 46.2 percent to $15.1 million.
At the Rebecca Taylor and Parker brands, the loss from operations was $3.1 million, compared to a loss of $20.4 million in the same period last year. The fiscal 2019 loss from operations includes non-cash asset impairment charges of $20.1 million. Net sales decreased 76.9 percent to $4.8 million.
As reported, Brendan Hoffman, the former ceo of Vince Holding Corp., last week joined Wolverine Worldwide as president and ceo-designee.