Destination Maternity (DEST) Reports Q1 Loss of $0.08
Destination Maternity (NASDAQ: DEST) reported Q1 EPS of ($0.08), versus $0.30 reported last year. Revenue for the quarter came in at $106.4 million, versus $124.4 million reported last year.
- Net sales were $106.4 million compared with $124.4 million for the prior year quarter.
- Gross margin improved 30 basis points to 54.4%, up from 54.1% in the prior year quarter.
- SG&A declined approximately $3.2 million to $55.6 million, a decrease of 5.3% from the prior year quarter.
- GAAP net loss was $1.1 million, or $0.08 per diluted share, compared to a GAAP net income of $4.0 million, or $0.30 per diluted share, for the prior year quarter.
- Debt, net of cash, was $36.7 million, a decrease of $10.5 million from end of the prior year quarter.
Anthony M. Romano, Chief Executive Officer & President, stated, "Our financial results in the first quarter were challenging and below expectations. While we are disappointed in these results, we have made tangible progress in a very difficult retail environment. Notably, we successfully re-launched our new eCommerce sites with minimal disruption and strong initial performance metrics, including a 40+% increase in conversion rate driving 18.8% web sales growth. Working capital improvements and reduced capital expenditures allowed us to reduce our debt, net of cash, by $10.5 million year-over-year and our focus on inventory management produced modest improvements in conversion and units per transaction. As we look ahead to the remainder of the year, we continue to believe we are positioned to drive improvement in sales and profitability, and we look forward to completing our proposed merger with Orchestra-Prémaman, which we expect to provide significant synergies and resources to allow us to accelerate our turnaround."
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