Differential Brands posts 10% sales jump in 2017, plans Hudson Jeans activewear
Differential Brands Group released on Monday its fourth-quarter and full-year financial results, which included an increase in net sales for both periods.
The group, which owns Hudson Jeans, Robert Graham and Swims, saw net sales for the year increase 10 percent to $164.1 million. Consumer direct sales grew 9 percent with the largest source of growth coming from e-commerce sales, jumping 13 percent, while comparable store sales grew 4 percent. Wholesale segment sales also climbed 9 percent.
In its fourth quarter, total company net sales grew 7 percent to $45.1 million, reflecting a 6 percent increase in wholesale segment sales and an 8 percent increase in consumer direct segment sales.
“I am pleased to report that all of our brands produced positive total comparable sales, improved margin dollars, expanded margin rates and leveraged SGA during the fourth quarter, 2017,” said CEO Michael Buckley, who noted a strong momentum across its consumer direct business, especially with Robert Graham stores, which saw sales climb 7 percent for the quarter on a comparable basis, with store net sales momentum continuing into 2018's first quarter.
Meanwhile, the wholesale division's increase during the quarter was driven by 40 percent growth at Swims - as a result of European growth and the opening of an additional store - as well as by modest growth from the Hudson brand, which continued to post a solid Wholesale performance, up 5 percent.
For the year ended December 31, 2017, gross profit was $71.8 million. Operating income from continuing operations was $1.1 million, compared to operating losses from continuing operations of $10.2 million for the same period last year.
In the fourth quarter, gross profit was $18.9 million, compared to $16.8 million in the fourth quarter of fiscal 2016. Operating income was $0.4 million, compared to an operating loss of $2.9 million for the same period last year.
For the upcoming 2018 fiscal year, the group is planning a number of new sales initiatives for each brand.
In particular, for the fall 2018 season, the company is developing a new line of sportswear to complement its denim products at the Hudson brand, noted Buckley.
“At Robert Graham, we are adding additional catalog drops and circulation, as well as expanding the Robert Graham assortment, through licensing, to include home furnishings and additional accessory styles. Lastly, at SWIMS we are offering an expanded assortment of footwear starting Spring 2018, to go along with our outerwear line in Europe for Fall 2018. We also will be adding our first full price SWIMS store at a key high street location in Oslo, Norway in Fall 2018.”
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