Differential Brands Group said its loss widened in the second quarter.
The company said the net loss for the three months ended June 30 was $3.6 million, or 29 cents a diluted share, from a net loss of $488,000, or 6 cents, a year ago. Excluding transaction costs connected with the Robert Graham merger and the Swims acquisition, the net loss was $1.7 million, or 13 cents a diluted share. Net sales doubled to $32.4 million from $16.3 million. The company said wholesale sales were $22.8 million, which included a $17.7 million contribution from its Hudson brand. The consumer direct segment posted sales of $9.1 million, helped in part by the addition of $846,000 from the Hudson e-commerce business.
Michael Buckley, chief executive officer, said the company continued to improve its product offerings across its portfolio of brands during the second quarter.
“In our wholesale segment, we were pleased with the performance of Hudson, which benefited from operational efficiencies put into place following the closing of the RG merger,” Buckley said. He added that in the consumer direct segment, the company has remerchandised and revamped its Robert Graham collection in its retail stores, “which resulted in positive sell-throughs and an increase in sales.” Still, organic sales were impacted by continued challenges across the wholesale and consumer segments, he said.
The ceo said the company is focused on “growing the business organically and through acquisitions of premium brands are are accretive and complementary to our portfolio.”
The company acquired Scandinavian lifestyle brand Swims earlier this year, representing the first acquisition under the Differential Brands umbrella.
It also said it was filing an amendment to its fiscal first quarter financial results due to a classification mischaracterization of operations disposed of from the company’s former Joe’s business. That resulted in higher operating losses from continuing operations than the company had actually incurred for the fist quarter, overstating the operating loss by $1.3 million and overstating net sales from continuing operations by $1.2 million, among other misstatements.