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American Apparel total retail sales go up in Q1
14 May '08
4 min read
American Apparel Inc, a vertically integrated manufacturer, distributor, and retailer of branded fashion basic apparel, announced its financial results for the first quarter of 2008.
Total retail sales across all segments increased 65% to $63.1 million for the first quarter of 2008 as compared to $38.3 million for the same period in 2007, with same-store sales for stores open at least 12 months rising 36%. Total wholesale sales across all segments $48.5 million for the first quarter of 2008, as compared to $35.2 million for the first quarter of 2007, an increase of 38%. American Apparel ended the quarter with 186 stores, having added 4 net new stores in the period.
Gross margin in the quarter declined 280 basis points to 55.3%. The main driver in this decrease was a decline in the U.S. Wholesale gross margin to 20.6% from 38.4% in the first quarter of 2007. Gross margin for the U.S. Wholesale segment for the full year of 2007 was 27.8%, and the company expects its gross margin for this segment to be more in line with that level for the remainder of 2008.
Gross profit in the first quarter of 2008 was impacted by approximately $0.9 million in startup costs at the company's garment dyeing and finishing facility purchased in December 2007, and $0.5 million in extra costs related to a three day production shutdown to accommodate the cutover to a new ERP system. The company also incurred additional training and startup costs relating to increased hiring to support an expansion in production capacity starting in the first quarter.
Total retail sales across all segments increased 65% to $63.1 million for the first quarter of 2008 as compared to $38.3 million for the same period in 2007, with same-store sales for stores open at least 12 months rising 36%. Total wholesale sales across all segments $48.5 million for the first quarter of 2008, as compared to $35.2 million for the first quarter of 2007, an increase of 38%. American Apparel ended the quarter with 186 stores, having added 4 net new stores in the period.
Gross margin in the quarter declined 280 basis points to 55.3%. The main driver in this decrease was a decline in the U.S. Wholesale gross margin to 20.6% from 38.4% in the first quarter of 2007. Gross margin for the U.S. Wholesale segment for the full year of 2007 was 27.8%, and the company expects its gross margin for this segment to be more in line with that level for the remainder of 2008.
Gross profit in the first quarter of 2008 was impacted by approximately $0.9 million in startup costs at the company's garment dyeing and finishing facility purchased in December 2007, and $0.5 million in extra costs related to a three day production shutdown to accommodate the cutover to a new ERP system. The company also incurred additional training and startup costs relating to increased hiring to support an expansion in production capacity starting in the first quarter.
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