A “perfect storm” of global events has resulted in long lead times for some paper grades – with mills resorting to allocation for the first time in over a decade – and printers and paper buyers have been warned to plan ahead for the rest of the year. The combination of factors affecting the supply of graphical papers includes increasing demand for pulp for other markets, such as tissue and hygiene products, which has pushed prices up to almost $1,200 (£883) a tonne. A year ago it was $700-$750. As well as pulp prices, other rising input costs for papermakers include chemicals and fillers. In recent years paper manufacturers have shut down paper machines in the face of declining demand, or converted lines to make other higher-value products, such as cartonboard. Click Read More below for additional information.
Third Quarter highlights:
•Total revenues decreased 5% to $566.7 million. Comparable company sales decreased 9% following a decrease of 8% in the third quarter last year.
•J.Crew sales decreased 12% to $430.4 million. J.Crew comparable sales decreased 12% following a decrease of 9% in the third quarter last year.
•Madewell sales increased 22% to $107.5 million. Madewell comparable sales increased 13% following an increase of 4% in the third quarter last year.
•Gross margin increased to 40.1% from 38.1% in the third quarter last year.
•Selling, general and administrative expenses were $200.7 million, or 35.4% of revenues, compared to $204.5 million, or 34.5% of revenues in the third quarter last year. Excluding transformation costs of $12.4 million and transaction costs of $1.0 million (incurred in connection with the Company’s debt exchange and refinancing), selling, general and administrative expenses were $187.3 million, or 33.1% of revenues this year.
•Operating income was $24.7 million compared to $20.0 million in the third quarter last year. The third quarter this year includes transformation costs of $12.4 million and transaction costs of $1.0 million.
•Net loss was $17.6 million compared to $7.9 million in the third quarter last year. The third quarter this year includes the impact of transformation and transaction costs.
•Adjusted EBITDA increased $14.6 million, or 27%, to $67.9 million from $53.3 million in the third quarter last year. An explanation of the manner in which the Company uses adjusted EBITDA and a reconciliation to comparable GAAP measures are included in Exhibit (3).
Jim Brett, Chief Executive Officer, remarked, “Our goal is to reinvigorate the J.Crew Brand to reflect the America of today and to continue to drive strong momentum in the Madewell Brand.”
“During the third quarter of fiscal 2017, we drove gross margin expansion and reduced SG&A by delivering on our expense initiatives. As we solidify longer term strategies, we will continue to leverage our strong brand equity and unique capabilities to expand our reach, accelerate growth and maximize profitability.”
more detail at: https://www.prnewswire.com/news-releases/jcrew-group-inc-announces-third-quarter-fiscal-2017-results-300560491.html?tc=eml_cleartime