Lands' End, Inc. (LE) swung to a net loss for the quarter ended Oct. 28, 2016. The company has made a net loss of $7.22 million, or $ 0.23 a share in the quarter, against a net profit of $10.72 million, or $0.33 a share in the last year period. Revenue during the quarter dropped 6.86 percent to $311.48 million from $334.43 million in the previous year period. Gross margin for the quarter contracted 566 basis points over the previous year period to 42.91 percent. Operating margin for the quarter stood at negative 1.10 percent as compared to a positive 6.97 percent for the previous year period.
Operating loss for the quarter was $3.42 million, compared with an operating income of $23.30 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $1.29 million compared with $26.55 million in the prior year period. At the same time, adjusted EBITDA margin contracted 753 basis points in the quarter to 0.41 percent from 7.94 percent in the last year period.
Joseph Boitano, Co-Interim chief executive officer commented, "We now have a more clearly defined and focused strategy in place, which we believe will enable us to better execute on our goal to deliver product that offers newness and innovation, as well as more readily address the lifestyle needs of the Lands' End customer. Our first priority is to enhance our classic offering with a focus on key categories that reflect the Lands' End brand heritage with great quality, fit and value. We have also refined our marketing strategy with enhancements to our catalog presentation and social media efforts. Taken together, we believe these initiatives will position us to better engage our customers, win back lapsed customers and attract new customers to Lands' End."
Operating cash flow remains negative
Lands' End, Inc. has spent $67.26 million cash to meet operating activities during the nine month period as against cash outgo of $94.79 million in the last year period. The company has spent $26.04 million cash to meet investing activities during the nine month period as against cash outgo of $18.12 million in the last year period.
Cash flow from financing activities was unchanged at negative $3.86 million for the nine month period, when compared with the last year period.
Cash and cash equivalents stood at $131.53 million as on Oct. 28, 2016, up 25.29 percent or $26.55 million from $104.99 million on Oct. 30, 2015.
Debt remains almost stable
Lands' End, Inc. has recorded a decline in total debt over the last one year. It stood at $490.99 million as on Oct. 28, 2016, down 0.77 percent or $3.80 million from $494.79 million on Oct. 30, 2015. Lands End has recorded a decline in long-term debt over the last one year. It stood at $490.99 million as on Oct. 28, 2016, down 0.77 percent or $3.80 million from $494.79 million on Oct. 30, 2015. Total debt was 37.39 percent of total assets as on Oct. 28, 2016, compared with 35.61 percent on Oct. 30, 2015. Debt to equity ratio was at 1.34 as on Oct. 28, 2016, up from 1.16 as on Oct. 30, 2015.
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