Sales increase 9% at Bluefly in 2011
Bluefly Inc, a leading online retailer of designer brands, fashion trends and superior value announced results for the fourth quarter and fiscal year ended December 31, 2011.
Joseph Park, Bluefly's Chief Executive Officer stated: “Fiscal 2011 was a pivotal period for our Company. We implemented key strategies to position our Company for future growth. To this end, we expanded our category reach with the launch of Eyefly.com in June 2011 and just prior to year end introduced Belle & Clive to consumers enabling us to leverage the 20 million unique visitors to Bluefly.com and our more than 350 brand relationships to offer the most important brands with limited time offers at members only pricing.
“We are very excited by the opportunities that Belle & Clive bring to our Company and have already seen a significant increase in subscriber growth in the two quarters since we implemented this new strategy. We begin 2012 with the foundation in place to advance our long term sales and profitability goals.”
Results for the full year of 2011 included the following highlights:
• Net sales increased by approximately 9% to $96.3 million, from $88.6 million in 2010, as a result of continued demand for our luxury designer merchandise and an increase in customer orders in 2011.
• Gross profit margin percentage was 29.4% compared to 37.5% in 2010, primarily as a result of an increase in inventory reserves of approximately $2.2 million, a write-off of $1.0 million related to merchandise credits from suppliers that the Company now believes may not be collected, as well as higher promotional activity and currency fluctuations between the U.S. dollar and the Euro.
• The increase in inventory reserves was primarily the result of a shift in Company strategy with a view to accelerating inventory turns.
• Total operating expenses increased by approximately 6% to $39.4 million, from approximately $37.0 million for 2010. As a percentage of net sales, total operating expenses decreased to 40.9%, compared to 41.8% for 2010.
• The increase in total operating expenses was primarily attributable to an increase in selling and fulfillment expenses and general and administrative expenses, offset partially by a reduction in marketing expenses.
• Included in general and administrative expenses are a write-off and reserve of $1.2 million in connection with a trade receivable that we now believe may not be collected in its entirety. As a percentage of net sales, total marketing expenses decreased to 11.3%, compared to 14.2% for 2010.
• Operating loss was $11.1 million, as compared to $3.8 million in 2010.
• Adjusted EBITDA was negative $7.3 million, as compared to an adjusted negative EBITDA of $716,000 in 2010.
• Net loss attributable to stockholders was $11.0 million, as compared to net loss of $4.0 million in 2010. Loss per share attributable to stockholders increased to $0.43 per share, from a net loss of $0.17 per share in 2010.