Plus size clothing retailer Torrid's Q2 profit improves

Plus size apparel retailer Torrid’s gross profit margin for the second quarter was 38.7 percent, an improvement of 323 bps, net income rose to 8.3 million dollars or 8 cents per share, and adjusted EBITDA increased to 34.6 million dollars or 12.2 percent of net sales.

However, net sales for the quarter decreased 1.6 percent for the second quarter to 284.6 million dollars, while comparable sales decreased 0.8 percent consisting of regular price comparable sales growth of 6.4 percent, offset by an approximate 50 percent decrease in markdown comparable sales.

Commenting on the second quarter update, Lisa Harper, chief executive officer of Torrid, stated: “We are very pleased with our second quarter performance, which came in at the high end of sales guidance and exceeded our adjusted EBITDA expectations. We expect to generate low single digit positive comparable store sales in the back half of the year driven by higher full-price sales as our markdown levels normalise.”

In the second quarter, the company opened five stores and closed six stores and ended the quarter with 657 stores.

For the third quarter, the company expects net sales between 280 million dollars and 285 million dollars and adjusted EBITDA between 23 million dollars and 26 million dollars.

For the full year, Torrid expects net sales between 1.135 billion dollars and 1.145 billion dollars and adjusted EBITDA between 110 million dollars and 116 million dollars.

The company plans to open 12 to 16 new Torrid stores and close 10 to 15 stores, while continuing to evaluate the fleet.