Retailer Roots reports fourth-quarter profit down from year ago, sales up
The storefront of a Roots location in Toronto is pictured on Thursday, September 14 , 2017. THE CANADIAN PRESS/Chris Young
The Canadian Press
Published Wednesday, April 3, 2019 8:38AM EDT
Last Updated Wednesday, April 3, 2019 11:03AM EDT
TORONTO -- Clothing retailer Roots Corp. topped expectations as its fourth-quarter revenue grew compared with a year ago and it earned a profit of $18.3 million.
The Toronto-based company said Wednesday sales totalled $130.8 million, up from $130.0 million in the fourth quarter of its 2017 financial year, which included an extra week.
Excluding the extra week, Roots says sales in the quarter were up 3.1 per cent, while comparable store sales growth amounted to 3.1 per cent.
"In the quarter, we saw growth in key perennial product favourites and encouraging consumer response to new product introductions," Roots chief executive Jim Gabel said in a statement.
"In addition, we benefited from store renovations, our ability to support higher levels of shopping activity during peak selling periods, and our success in overcoming challenges caused by the Canada Post strike."
Its profit for the quarter ended Feb. 2 amounted to 43 cents per share, down from $20.9 million or 50 cents per share in the same quarter a year earlier.
On an adjusted basis, Roots says it earned 53 cents per share, down from 59 cents per share.
Analysts on average had expected a profit of 50 cents per share for the quarter on $129 million in revenue, according to Thomson Reuters Eikon.
Gabel said the company is on track to achieve its 2019 financial targets.
"To build on our fiscal 2018 record revenue, we will execute our strategy with an amplified brand voice and the introduction of more seasonally transitional products, while also benefiting from the strategic investments we have made in the business," he said.
In its outlook, Roots said it expected sales between $358 million and $375 million for its 2019 financial year and adjusted net income between $20 million and $24 million.
For its full 2018 financial year, Roots reported a profit of $11.4 million or 27 cents per diluted share on $329 million. That compared with a profit of $17.5 million or 41 cents per diluted share on $326.1 million in sales for the previous year.
On an adjusted basis, Roots earned 48 cents per share for its 2018 financial year, down from 69 cents per share in its 2017 financial year.