a.k.a. Brands swings to Q1 loss, but ups FY outlook

San Francisco-based fashion group a.k.a. Brands upped its full-year outlook Wednesday despite swinging to a Q1 loss and reporting a 18.8 percent drop in sales.

The company, whose portfolio includes Princess Polly, Mnml, Petal & Pup, Rebdolls, and Culture Kings, made net sales of 120.5 million dollars in the three months to March 31, down from 148.3 million dollars a year earlier.

a.k.a. Brands said its sales were impacted by a decline in the number of orders and average order value primarily due to macroeconomic conditions, including higher promotional activity and fluctuations in foreign currency rates.

The company swung to a net loss of 9.6 million dollars in the first quarter from a profit of 1.5 million dollars the prior year. Adjusted EBITDA, meanwhile, narrowed to 2.2 million dollars from 10.7 million dollars.

a.k.a. Brands upped its full-year sales and profit outlook following its Q1 results. It now expects FY23 net sales of between 575 million dollars and 605 million dollars, compared to its previous guidance of between 570 million dollars and 600 million dollars.

It expects adjusted EBITDA of between 36 million dollars and 38 million dollars, compared to its previous guidance of between 35 million dollars and 37 million dollars.

a.k.a. Brands interim CEO and CFO Ciaran Long told investors: “I’m proud of our solid first quarter performance, which exceeded our expectations on both sales and adjusted EBITDA, driven by the strong execution across our brands and our continued focus on managing the business prudently.”

He noted that the company’s inventory balance is down 11 percent from the end of FY22 and down 7 percent from the first quarter of last year.