Loss at Lands’ End Grows
The specialty retailer continues to close its shops inside Sears while opening freestanding stores.
Lands’ End reported that its net loss in the second quarter grew to $5.3 million, or 16 cents a diluted share, from $3.9 million, or 12 cents, in the year-ago period.
The all-American specialty retailer also saw a same- store sales decline of
5.8 percent.
The declines, coming in a season where most retailers are on a roll, dragged Lands' End stock price down 12 percent, or $3.05, to $222 after the results were issued Thursday.
On the positive side, adjusted earnings before interest, taxes, depreciation and appreciation grew 13.1 percent to $7.7 million, compared to $6.8 million in the second quarter of fiscal 2017.
Total revenues increased 1.9 percent to $307.9 million in the quarter from $302.2 million in the second quarter last year. Gross margin reached 44.4 percent, up slightly compared to the second quarter last year.
Direct segment net revenue increased 6.4 percent to $276.6 million. The retail segment decreased 25.8 percent to $31.3 million, primarily attributable to closing 57 Lands' End shops inside Sears stores and the overall same-store sales decline of 5.8 percent.
Same-store sales in Lands' End shops at Sears declined 6.7 percent while samestore sales at company-operated stores declined 0.6 percent.
Turnaround efforts at Lands' End largely revolves around opening company- owned stores, joining online marketplaces, expanding its uniform business and winding down its business with Sears. Forty to 60 stores are seen operating by 2022.
“Our second-quarter results reflect our fifth consecutive quarter of revenue growth and our fourth straight quarter of adjusted EBITDA growth,” said Jerome Griffith, president and chief executive officer.
“Overall, we continue to see evidence that our strategic initiatives are taking hold with product and marketing efforts both resonating with our customer. Looking ahead, we will remain intently focused on our four key focus areas of product, digitization, uni-channel distribution and infrastructure.” ■