Lands’ End Q4 and FY23 revenues decline

Lands’ End reported fourth quarter net revenue decreased 2.8 percent to 514.9 million dollars compared to the fourth quarter of fiscal 2022.

For the fiscal year 2023, the company’s net revenue decreased 5.3 percent to 1.47 million dollars.

Commenting on the results, Andrew McLean, the company’s CEO, stated: “We pursued our solutions-based strategy to introduce newness across the product assortment, generated higher quality sales, significantly enhanced our inventory position and improved our profitability. As a result of these efforts, in the fourth quarter we increased gross profit by 13.5 percent, improved gross margin by 550 basis points and reduced inventory 29 percent compared to last year.”

Highlights of Lands’ End Q4 results

The company’s global ecommerce net revenue of 404.9 million dollars, decreased 2.3 percent. Excluding Lands’ End Japan global ecommerce net revenue decreased 0.6 percent.

The company said in a release that U.S. ecommerce revenue increased 0.1 percent, international ecommerce decreased by 20.2 percent and ecommerce revenues in Europe decreased 6.2 percent.

Outfitters net revenue was 53.7 million dollars in the fourth quarter, a decrease of 6.8 million dollars or 11.3 percent due to the conclusion of the Delta Air Lines contract in the first quarter of fiscal 2023. Excluding the 5.1 million dollars decrease in revenue from the Delta Air Lines business, the Outfitters business decreased 3.2 percent due to the timing of school uniform shipments compared to prior year.

Third party net revenue was 40.5 million dollars, an increase of 1.3 million dollars or 3.3 percent.

Gross profit for the quarter was 195.4 million dollars, an increase of 23.3 million dollars or 13.5 percent, while gross margin increased approximately 550 basis points to 38 percent.

Net loss widened to 8.6 million dollars or 27 cents loss per diluted share. Adjusted net income was 8 million dollars or 25 cents earnings per diluted share and adjusted EBITDA was 31.7 million dollars in the fourth quarter.

Lands’ End full year financial performance

Global ecommerce net revenue was 1 billion dollars, a decrease of 7.1 percent versus fiscal 2022. Excluding Lands’ End Japan in fiscal 2022, global ecommerce Net revenue decreased 4.3 percent.

Net revenue in US ecommerce decreased by 2.7 percent and Europe ecommerce decreased by 15.7 percent.

Outfitters net revenue was 269.9 million dollars for fiscal 2023, an increase of 4 million dollars or 1.5 percent. Third party net revenue was 111.8 million dollars, a decrease of 7.2 million dollars or 6 percent.

Gross profit for the year was 625.5 million dollars, an increase of 31.7 million dollars or 5.3 percent, while gross margin increased approximately 430 basis points to 42.5 percent.

Net loss was 130.7 million dollars or 4.09 dollars loss per diluted share. Adjusted net loss was 4.8 million dollars or 15 cents loss per diluted share, while adjusted EBITDA rose to 84.3 million dollars compared to fiscal 2022.

Lands’ End announces Q1 and FY24 forecast

For the first quarter of fiscal 2024 the company expects net revenue to be between 255 million dollars and 285 million dollars.

Net loss is expected to be between 10 million dollars and 8 million dollars and diluted loss per share to be between 32 cents and 25 cents and adjusted net loss to be between 9.5 million dollars and 7.5 million dollars, adjusted diluted loss per share to be between 30 cents and 24 cents and adjusted EBITDA in the range of 9 million dollars to 11 million dollars.

For fiscal 2024 the company expects net revenue to be between 1.33 billion dollars and 1.45 billion dollars.

Net income is expected to be between 1 million dollars and 10 million dollars, diluted earnings per share to be between 3 cents and 32 cents, adjusted net income to be between 3 million dollars and 12 million dollars, adjusted diluted earnings per share to be between 10 cents and 38 cents and adjusted EBITDA in the range of 84 million dollars to 96 million dollars.