Aritzia reports strong results driven by retail expansion in the US

Second quarter net revenue at Aritzia increased 15.3 percent to 615.7 million dollars, with comparable sales growth of 6.5 percent.

United States net revenue increased 23.9 percent to 345.4 million dollars, retail net revenue increased 17.6 percent to 425.6 million dollars.

"Our performance during the second quarter exceeded our expectations. Our top line was fueled by a 24 percent net revenue increase in the United States, which was driven by our proven real estate expansion strategy, a meaningful acceleration in ecommerce growth and strong comparable sales growth in our boutiques," said Jennifer Wong, the company’s chief executive officer.

Aritzia posts Q2 EBITDA growth

The company’s ecommerce net revenue increased 10.4 percent to 190 million dollars.

Gross profit margin increased 520 bps to 40.2 percent, adjusted EBITDA increased 160.7 percent to 55.2 million dollars, adjusted EBITDA as a percentage of net revenue increased 500 bps to 9 percent.

Net income for the quarter increased 404.6 percent to 18.2 million dollars, while net loss per diluted share was 16 cents per share.

Adjusted net income increased 618.5 percent to 24.5 million dollars and adjusted net income per diluted share was 21 cents per share.

Aritzia’s first half revenues increase by 11.8 percent

Net revenue for the first six month period increased by 11.8 percent to 1.1 billion dollars, while comparable sales grew by 4.4 percent driven by performance in the United States, where net revenue increased by 18.7 percent to 630.1 million dollars.

Net revenue in Canada increased by 3.9 percent to 484.2 million dollars. Retail net revenue increased by 13.6 percent to 783.5 million dollars driven by strong performance of the company's new and repositioned boutiques, as well as positive comparable sales growth in its existing boutiques.

Ecommerce net revenue increased by 7.7 percent to 330.8 million dollars, driven by traffic growth in the United States and inventory optimization.

Gross profit increased by 27.3 percent to 467 million dollars, gross profit margin was 41.9 percent, up approximately 510 bps. Net income was 34.1 million dollars, an increase of 196.9 percent, while net income per diluted share was 30 cents, an increase of 200 percent. Adjusted EBITDA was 109 million dollars or 9.8 percent of net revenue, an increase of 106.7 percent, adjusted net income was 49.5 million dollars, an increase of 238.4 percent, and adjusted net income per diluted share was 43 cents, an increase of 230.8 percent.

Aritzia forecasts FY25 revenue growth to range between 9 to 11 percent

Based on quarter-to-date trends, Aritzia expects third quarter net revenue in the range of 675 million dollars to 700 million dollars, representing growth of approximately 3 percent to 7 percent or approximately 7 percent to 11 percent excluding the Digital Archive Sale and the calendar shift causing the annual warehouse sale to fall in the second quarter.

The company expects gross profit margin to increase approximately 400 bps.

For fiscal 2025, the company’s net revenue is expected to be in the range of 2.54 billion dollars to 2.60 billion dollars, representing growth of approximately 9 percent to 11 percent.

This includes the contribution from retail expansion with 12 to 13 new boutiques and three to four boutique repositions.

Gross profit margin is expected to increase by approximately 450 bps compared to fiscal 2024, and adjusted EBITDA as a percentage of net revenue is forecasted to increase by approximately 400 bps to 450 bps.