Roots blames $5.6M loss in part to storm’s sales hit
TORONTO Roots Corp. reported a loss of $5.6 million in its fiscal first quarter, an increase from the prior year, but also reported an improvement in sales.
The loss amounted to 13 cents per share, compared with last year’s loss of $5.1 million, or 12 cents per share.
Its adjusted net loss was $4.5 million or 11 cents per share, compared with $3.6 million or nine cents per share a year ago.
Analysts had expected a loss of nine cents per share, according to Thomson Reuters Eikon.
But Roots says it remains confident that it will achieve its fullyear target of between $35 million and $40 million of adjusted net income and between $410 million and $450 million of sales for fiscal 2019.
Total sales for the quarter ended May 5 were up 5.8 per cent to $51 million, from $48.2 million.
Sales from corporate retail stores and e-commerce channels accounted for $44.2 million, up nine per cent from $40.5 million in last year’s first quarter. Samestore sales, a key industry metric, increased 6.4 per cent over the same quarter of its last fiscal year.
The company believes a winter storm affecting 80 per cent of its store network probably reduced sales from a semi-annual, four-day event during the quarter.
The clothing retailer has been embarking on an expansion strategy into the U.S. The heritage- clothing chain recently announced it plans to open stores in Chicago, Washington, D.C., area and Greater Boston, Mass., area this summer.
Roots wants to open 10 to 14 new American locations by the end of 2019, and as of Feb. 3 operated three U.S. stores.
It listed its shares on the Toronto Stock Exchange in October. At the time, the initial public offering was considered unsuccessful as the initial stock price of $12 per share was below the original proposed range of $14 to $16 each and the stock fell on the first day of trading to close at $10.