J.Crew Q3 net loss widens, revenues down 5 percent

J.Crew Group’s total revenues for the third quarter decreased 5 percent to 566.7 million dollars, while comparable company sales decreased 9 percent following a decrease of 8 percent in the third quarter last year. Net loss was 17.6 million dollars compared to 7.9 million dollars in the third quarter last year.

Commenting on the trading update, Jim Brett, J.Crew’s Chief Executive Officer, said in a press release: "During the third quarter of fiscal 2017, we drove gross margin expansion and reduced SG&A by delivering on our expense initiatives. As we solidify longer term strategies, we will continue to leverage our strong brand equity and unique capabilities to expand our reach, accelerate growth and maximize profitability."

Third quarter highlights of J.Crew result

J.Crew brand sales decreased 12 percent to 430.4 million dollars with comparable sales decrease of 12 percent following a 9 percent decrease in the third quarter last year. Madewell sales increased 22 percent to 107.5 million dollars with comparable sales increasing 13 percent following an increase of 4 percent in the third quarter last year.

Gross margin increased to 40.1 percent from 38.1 percent in the third quarter last year. Operating income was 24.7 million dollars compared to 20. million dollars in the third quarter last year. Adjusted EBITDA increased 14.6 million dollars or 27 percent to 67.9 million dollars.

Review of first nine months results

Total revenues decreased 4 percent to 1,659.5 million dollars with comparable company sales decreasing 8 percent following a decrease of 7 percent in the first nine months last year.

J.Crew brand sales for the nine months decreased 10 percent to 1,302 million dollars, while comparable sales decreased 11 percent. Madewell sales increased 20 percent to 285.2 million dollars with comparable sales increase of 11 percent.

Gross margin increased to 38.1 percent from 36.6 percent in the first nine months last year. Operating loss was 126.1 million dollars compared with operating income of 34 million dollars in the first nine months last year. Net loss was 161.6 million dollars compared to 24.6 million dollars in the first nine months last year. Adjusted EBITDA increased 20.6 million dollars or 15 percent to 157.6 million dollars.

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