TORONTO — Roots Corp. has lowered its sales and earnings estimates from targets set when the company went public in October 2017 after sales fell “well below” its own expectations in the third quarter.
The clothing company’s total sales for the three months ended Nov. 3 were $87 million, down three per cent from $89.7 million last year when Roots benefited from Canada’s 150th anniversary celebrations.
Net income was $2.8 million or seven cents per share, down from $5.0 million or 12 cent per share last year.
Adjusted net income was $4.7 million or 11 cents per share, down from 23 cents per share in last year’s third quarter.
Analysts had estimated $90.6 million of revenue and 16 cents per share of adjusted earnings, according to Thomson Reuters Eikon.
Roots says its performance during the quarter reflected the absence of a large marketing campaign and unseasonably warm fall weather.
The company is now estimating between $358 million and $375 million of sales in fiscal 2018, compared with the estimated range of $410 million to $450 million when Roots did its initial public offering.
Roots is also revising its fiscal 2019 target range for adjusted EBITDA to between $46 million and $50 million, from between $61 million and $68 million, and it’s also revising its adjusted net income target range to between $20 million and $24 million from its previously stated target range of between $35 million and $40 million.
Companies in this story: (TSX:ROOT)
The Canadian Press