DavidsTea considering options, including sale, just 2 years after going public
DavidsTea is listing as "DTEA" at the Nasdaq MarketSite in New York on June 5, 2015. (THE CANADIAN PRESS / AP, Mark Lennihan)
The Canadian Press
Published Thursday, December 7, 2017 5:02PM EST
MONTREAL -- Canadian beverage retailer DavidsTea is evaluating its strategic options more than two years after it went public and soon after rival Teavana shut its doors.
The Montreal-based company announced the move Thursday while reporting weaker than expected third-quarter results.
DavidsTea (NASDAQ:DTEA) says its losses surged 30 per cent to $6.5 million from $5 million a year ago.
That equals 25 cents per share for the three months ended Oct. 28, compared to 20 cents in the prior year.
Excluding one-time items, the loss nearly doubled to $4.5 million or 17 cents per share, compared to a loss of $2.4 million or 10 cents per share in the third quarter of 2016.
Revenues decreased 2.5 per cent to $43 million as same-store sales -- a key retail metric for sales of existing stores -- fell 6.8 per cent.
DavidsTea CEO Joel Silver said the lower same-store sales reflects challenges in accessories and kits that "did not excite the customer."
He said the tea business was positive while e-commerce sales continued to grow.
DavidsTea says its board of directors decided to explore strategic alternatives, including a possible sale, in order to enhance shareholder value.
Starbucks closed its Teavana stores in July.