Differential Brands Group reports Q2 EBITDA of 1.2 million dollars

Differential Brands Group Inc. reported EBITDA of 1.2 million dollars driven by an 8 percent increase in consumer direct sales for the three months ended June 30, 2018. For the second quarter, the company said, net loss and loss per share were 5.7 million dollars and 0.54 dollar per share compared to 4.1 million dollars and 0.41 dollar per share, respectively, during the same quarter last year. Total company net sales decreased 1 percent to 36 million dollars.

Commenting on the second quarter trading, Michael Buckley, the company’s Chief Executive Officer, said in a statement: “Our consumer direct business continued its strong performance in the second quarter at both Robert Graham and Swims. Hudson wholesale sales declined 20 percent during the second quarter offsetting these gains. We continue course corrections at Hudson to navigate the shift in demand to retailers’ ecommerce channels from traditional physical store channels. Maria Borromeo, our recently hired President of Hudson, is acclimating nicely while leading this effort and has brought a heat-seeking focus to the Hudson strategy.”

Highlights of Differential Brands Group’s Q2 results

Total company net sales reflected an 8 percent increase in consumer direct segment sales and a 6 percent decrease in wholesale segment sales. The company added that consumer direct increase was driven by a 12 percent ecommerce channel increase and an 8 percent retail store channel increase during this period. Comparable store net sales increased 7 percent for the second quarter compared to the same quarter last year.

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Differential Brands Group further said that the wholesale segment net sales results reflected an 11 percent Robert Graham improvement over the same quarter last year, including a 14 percent year-over-year growth at full price specialty stores, and a 64 percent percent increase in Swims wholesale net sales, including both US and European volumes improving over 40 percent from the same quarter last year. Hudson wholesale net sales declined 20 percent.

Gross profit declined 1.7 million dollars to 14.5 million dollars for the second quarter driven by lower initial wholesale margins at the Hudson brand that more than offset initial margin gains at Robert Graham and Swims. Gross margin rates declined 420 basis points.

Picture:Robert Graham website