Inventory at the end of the second quarter totaled $106.7 million, compared to $126.5 million at the end of fiscal year 2022, or compared to $143.9 million at the end of the second quarter of 2022.Cash and cash equivalents at the end of the second quarter totaled $25.9 million, compared to $46.3 million at the end of fiscal year 2022.The increase in G&A as a percent of net sales during the quarter was primarily due lower sales volume compared to the prior year. G&A expenses were 17.8% of net sales compared to 16.2% of net sales in the second quarter of 2022. General and administrative (“G&A”) expenses were $24.2 million, compared to $25.7 million in the second quarter of 2022. ![]() The increase was primarily driven by lower sales volume compared to the prior year. Marketing expenses were 13.5% of net sales compared to 12.0% of net sales in the second quarter of 2022. Marketing expenses were $18.4 million, compared to $19.1 million in the second quarter of 2022.The decrease was primarily due to operational efficiencies in distribution, fulfillment and outbound shipping. Selling expenses were 26.4% of net sales compared to 28.6% of net sales in the second quarter of 2022. ![]() Selling expenses were $35.9 million, compared to $45.3 million in the second quarter of 2022.The improvement was primarily driven by improved full price sell-through, particularly in the U.S., and lower freight expenses. Gross margin was 56.9%, compared to 55.2% in the second quarter of 2022.On a Constant Currency 1 basis, net sales decreased 11%. The decrease was driven by a decline in the number of orders and average order value during the quarter, primarily driven by adverse macroeconomic conditions in Australia. Net sales decreased 14.2% to $136.0 million, compared to $158.5 million in the second quarter of 2022.mnml remains a top 10 brand at Culture Kings and continues to leverage Culture Kings for new customer acquisition and marketing activations.Petal & Pup continues to exceed expectations on Target marketplace and is exploring additional omnichannel tests.streetwear industry with the flagship store in Las Vegas outperforming expectations and recent partnerships with Rolling Loud and the UFC. Culture Kings continues to disrupt the U.S.Princess Polly is expanding its wholesale relationship with PacSun to 100 stores and remains on-track to open its first store in Los Angeles next month.We remain confident in the future of our brands and our business model and are committed to driving shareholder value,” concluded Long. Looking ahead, we remain laser focused on chasing consumer demand, driving greater operational efficiencies and strengthening the balance sheet by paying down additional debt through the remainder of the year. We’re excited to announce that Princess Polly is expanding its partnership with PacSun to 100 stores and will open its first store next month. ![]() “Importantly, we are increasing our total addressable market, particularly in the U.S., by introducing our brands to new customers through direct to consumer and omnichannel initiatives. Despite the inline performance in the U.S., our overall net sales were dampened by continued macro pressures and consumer challenges in Australia.” performance was in line with our expectations, registering $80 million of net sales in the second quarter and delivering 12% growth on a two-year basis. “I’m also pleased that we continued to strengthen our balance sheet by way of strategically reducing inventories, which were down 16% since the end of fiscal 2022, and we paid down $12.5 million of debt in the quarter. “We continue to execute against our strategic initiatives and have made significant improvements in our operating efficiencies, which enabled us to deliver on our adjusted EBITDA and cash flow expectations for the second quarter,” said Ciaran Long, Interim Chief Executive Officer and Chief Financial Officer.
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