Canadian firm Roots posts sales of $262.7 mn in FY23

The partner and other segment reported sales of $40.2 million in FY23, slightly down from $40.9 million in FY22. Despite the dip in overall sales, the company's gross profit stood strong at $152.5 million, only a 2.9% decline from $157 million in the previous year. Notably, the gross margin improved to 58.0%, up from 57.7% in FY22, the company said in a media release.

DTC gross margin saw an increase as well, reaching 61.1% in FY23, which reflects a 30-basis points improvement from 60.8% in FY22. However, selling, general, and administrative expenses rose slightly by 1.2% to $140.3 million.

Net income for the fiscal year was $1.8 million, or $0.05 per share, a significant decrease from $6.7 million, or $0.16 per share, in FY22. Adjusted EBITDA also saw a reduction, totalling $19.9 million compared to $27 million in the previous year.

In the fourth quarter of FY23 (Q4 FY23), Roots continued to face challenges with sales decreasing by 2.9% year-over-year to $108.2 million. DTC sales saw a minor decrease of 0.8% to $97.8 million. However, the company managed to improve its gross margin significantly to 58.6%, up from 56.5% in the fourth quarter of FY22. The DTC gross margin also improved, reaching 59.9% compared to 58.7%.

Net income for Q4 FY23 was $14.6 million, an increase from $13.0 million in the same quarter of the previous year. Adjusted EBITDA for the quarter was slightly down at $23.2 million versus $23.5 million in Q4 FY22.

"As we close another year, I want to acknowledge the resilience and hard work of the team at Roots in the face of a challenging economic environment. We continue to take significant steps to enhance our operations, strengthen our relationships with our customers, and make exceptional products. I remain confident in the longer-term growth prospects for the brand as the market normalises," said Meghan Roach, president & CEO of Roots.

Fibre2Fashion News Desk (DP)