Vince Holding Corp.’s fourth quarter results, posted after market close Tuesday, were better than expected.
The New York-based contemporary fashion brand said its reported net income for the fourth quarter, which ended Jan. 30, totaled $1.8 million, or 5 cents per diluted share, an 83 percent decline from the comparable quarter when net income was $10.5 million, or 28 cents per diluted share. Adjusted net income was $300,000, or 1 cent per diluted share. Analysts had projected diluted earnings per share of 0 cents.
Net sales decreased 13.6 percent, to $81.8 million, from $94.7 million in the fourth quarter of fiscal 2014.
Wholesale segment sales decreased 30.2 percent to $48.1 million and direct-to-consumer segment sales increased 30.5 percent to $33.7 million. Comparable store sales increased 10.7 percent, including e-commerce sales.
Vince CEO Brendan Hoffman said 2015 was a difficult year for the business but that initial response to the brand’s fall collection has been “extremely positive.”
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Still, Hoffman added, the first half could pose additional challenges.
“We are prepared for a tough first half, as we strategically reduce shipments and receipts while we reset the product assortment,” Hoffman said. “While the pullback in deliveries is expected to impact our sales results in the short term, we believe this is a necessary step for the long-term health of the brand.”
For the full year, net sales decreased 11.1 percent to $302.5 million, and comparable store sales increased 4.2 percent over the prior year period, including e-commerce sales. Net income was $5.1 million, or 14 cents per diluted share, an 86 percent decline from the prior year when net income was $35.7 million, or 93 cents per diluted share. Adjusted net income was $12.8 million, or 34 cents per diluted share, compared to adjusted net income of $36.1 million, or 94 cents per diluted share, in the prior year.
Looking ahead, the company expects net sales in the range of $290 million and $305 million; sales to decrease in the mid- to high-single digit range for the first half of the year and to increase in the low- to mid-single digit range in the second half of the year compared to the same prior year periods; diluted EPS in the range of 0 cents to 6 cents.
“We look forward to the holiday season when we expect to see the new product line drive a turn in our business,” Hoffman said. “In the meantime, we are carefully managing our inventory levels and diligently controlling costs while making strategic investments to support our business for the long term.”