- Prachi Singh |
Second quarter revenues at Apex Global Brands of 5.6 million, decreased 21 percent, reflecting decreases in the company’s Cherokee and Hi-Tec royalties in Europe, and the non-renewal of the company’s Cherokee license in South Africa at the end of fiscal 2019. The company said in a statement that economic uncertainty related to Brexit continues to impact several of the company’s European licensees and the strong U.S. dollar in relation to the British pound sterling and euro reduces the dollar value of the European royalty revenues. Revenues for the first six months were 10.7 million dollars, a decrease of 15 percent.
“The second quarter 2020 marks our first official quarter reporting as Apex Global Brands,” commented Chief Executive Officer Henry Stupp, adding, “Longer term we are optimistic that the actions we are taking and the portfolio we are building will result in a bigger, stronger and more profitable Apex. In the near-term, however, we face some challenges consistent with the entire retail industry including, a softening U.S. retail environment and uncertainty surrounding Brexit, which have resulted in lower top-line growth.”
Highlights of Apex Global Brands Q2 and H1 results
The company added that net loss from continuing operations was 1.3 million dollars in the second quarter or 8 cents per diluted share compared to 9.1 million dollars or 65 cents per diluted share, in the second quarter of the prior year. Net loss from continuing operations for the first six months was 3.5 million dollars or 22 cents per diluted share compared to 11.8 million dollars or 84 cents per diluted share. Adjusted EBITDA decreased to 2.5 million dollars for the second quarter, while adjusted EBITDA in the first six months decreased to 3.7 million dollars.
Due to the continuing negative impact on its licensees’ revenues because of economic uncertainty, Brexit and the impact of a weakened British pound sterling and euro, the company now anticipates full year revenues to be in the range of 23 million dollars to 24 million dollars and adjusted EBITDA in the range of 9.8 million dollars to 10.3 million dollars.