Vince Holding Corp., pre-releasing second-quarter results, said it expects to report a loss from operations of between $8.5 million and $9.5 million compared to a loss of $4.3 million in the second quarter of fiscal 2016.
Net sales for the quarter ended July 29 are expected to be between $60 million and $62 million, essentially flat compared to the $60.7 million in sales reported in the year-ago quarter.
The year-over-year increase in the loss from operations reflects $1.75 million to $2.5 million in investments related to the remediation and optimization of IT systems, severance and other one-time investments, as well as savings related to the company’s previous consulting arrangement with its founders. In addition, the prior year results reflected a $1.9 million benefit from favorable adjustments to inventory reserves.
The company indicated that estimated results for the second quarter are preliminary and subject to adjustment until the filing of its quarterly Form 10-Q with the Securities and Exchange Commission. The estimated results for the second quarter of fiscal 2017 are unaudited.
Vince expects to report results for the second quarter of fiscal 2017 on Sept. 7.
Vince previously revealed a $30 million rights offering, which will provide the company with additional liquidity and improve its capital structure. Vince has an agreement from its principal shareholder, Sun Capital, to backstop the offering.