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Joe's Jeans posts smart turnaround in Q3FY14 profits
13
Oct '14
Following completion acquisition of Hudson Clothing Holdings, NASDAQ-listed and apparel retailer - Joe’s Jeans Inc. posted a smart turnaround in its operating income which slipped in to black from red in the third quarter ended August 31, 2014.

Joe’s Jeans reported an operating profit of $3.8 million in the third quarter of 2014, compared to an operating loss of $295,000 in the third fiscal quarter of 2013.

The Hudson Clothing buy also helped revenues zoom 79% to $52.7 million compared to $29.4 million in the prior year comparative period.

In the same period, wholesale net sales also climbed 98%, from a year earlier quarter, while retail store net sales increased slower by 13% from the prior year quarter.

Gross profit for the third quarter of 2014 also nearly doubled to $24.5 million from $12.9 million in the prior year quarter, or a 90% increase.

Its overall gross margin in the period under review also rose to 46% versus 44% in the third quarter of 2013.

Operating expense stood at $20.7 million in third quarter of 2014 against $13.1 million, from a year ago.

Joe’s Jeans posted net income of $276,000 compared to a net loss of $287,000 in the prior year period.

As a result, its fully diluted earnings per share were comparable at $0.00 for the third quarter of fiscal 2014 and 2013.

Combining wholesale net sales of $22.1 million from Hudson Clothing, Joe’s Jeans said its wholesale segment sales surged 98% to $45.5 million compared to $23.1 million in the year ago period.

Net sales from the retail segment in the third quarter of 2014 grew 13% to $7.1 million vis-a-vis $6.3 million in the prior year comparative period.

According to Joe’s Jeans, retail sales growth was driven by contribution of $585,000 from Hudson’s e-shop as well as growing its store base by one store in the comparative period.

In addition, the retailer added, “Our same store sales, which include Joe’s stores open at least 12 months and our Joe’s e-shop, declined 2% during the quarter.” Corporate and Other

CEO Marc Crossman said, “On a historical combined basis, we increased revenue, expanded gross margins, and grew operating income.”

Crossman continued, “Both our Joe’s and Hudson brands experienced the same top line trends this quarter. More importantly, our brands are well positioned with non-denim offerings as we move into the fourth quarter.”

For the third quarter of 2014, corporate and other expenses touched $8.6 million compared to $4.9 million, which the retailer attributed to $4.7 million of expenses associated with Hudson’s corporate operations. (AR)

Fibre2fashion News Desk - India

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