Roots soars to new high after sales, adjusted earnings beat estimates

Roots Corp. shares jumped Wednesday to their highest levels since they were listed publicly last year, after the Canadian clothing company’s sales and adjusted earnings topped analyst estimates in its latest quarter.

The shares traded as high as $12.62 after the announcement, up as much as 10 per from Tuesday’s closing price. They closed at $12.60, up 9.85 per cent.

The Toronto-based firm’s stock has rarely traded above $12 for its initial public offering in October.

Roots announced its net income was $20.8 million, or 50 cents per share, for the fiscal fourth quarter ended Feb. 3, up from $17.2 million, or 41 cents per share, in the same quarter a last year.

On an adjusted basis, Roots says it earned 59 cents per share in the quarter, up from 48 cents per share a year ago. Analysts on average had expected an adjusted profit of 53 cents per share and revenue of $124.4 million, according to Thomson Reuters.

Sales for the period including the busy holiday shopping season totalled $130 million, up from $111.2 million in the same quarter a year ago. Same-store sales growth was 15.1 per cent.

Jim Gabel, president and CEO of Roots, said holiday sales “were outstanding both in-store and online, driving impressive top and bottom-line growth.”

Roots is aiming to achieve between $410 million and $450 million in annual sales for the 2019 financial year that ends in early 2020.