US fashion group Vince Holding Corp managed to narrow its losses in the first quarter despite its sales dropping year-on-year as the wind-down of its Rebecca Taylor hit its top line.
The company announced last September it would be closing down its Rebecca Taylor business to focus its resources on its namesake Vince brand.
Sales in the three months to April 29 dropped 18.2 percent to 64.1 million dollars as Rebecca Taylor sales plummeted 99.2 percent to 0.1 million dollars and Vince sales dropped 6.3 percent to 6 million dollars.
The group said the wind-down of the Rebecca Taylor business is now “substantially completed”.
Despite the drop in sales, the company narrowed its net loss in the first quarter to 0.4 million dollars from 7.2 million dollars the prior year.
Chief executive officer Jack Schwefel told investors: “Our first quarter results were largely in line with our expectations supported by our efforts to streamline our organization to focus on our core strengths while maintaining a disciplined approach to expense management as we continued to navigate a challenging macro environment.”
The trading update comes after US giant Authentic Brands Group last month completed its acquisition of the intellectual property of the Vince label from parent Vince Holding Corp, resulting in a new subsidiary, ABG Vince.
Authentic paid 76.5 million dollars for 75 percent majority ownership of the new subsidiary, while Vince Holding retained 25 percent.
Schwefel said Thursday: “With our strengthened balance sheet in place driven by our recent transaction with Authentic Brands Group, we believe we are better positioned to execute our strategic initiatives and prioritize our commitment to improved financial performance over time.”
Looking ahead, Schwefel said the company maintains a “cautious outlook”, particularly in regards to its wholesale channel.