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Apr 30, 2022
Vera Bradley Q1 2023 Earnings Report
Reported a net loss due to lower than expected revenues, partially offset by price increases and expense control.
Key Takeaways
Vera Bradley reported consolidated net revenues of $98.5 million and a net loss of $7.0 million, or $0.21 per diluted share, for the first quarter of fiscal year 2023. The results were impacted by inflationary pressures and a shift in social and digital media effectiveness.
Total Company first quarter revenues fell below expectations, resulting in a net loss of $0.19 per diluted share before certain charges.
Inflationary pressures impacted spending of Vera Bradley full-line customers with household incomes below $55,000 and traffic in factory stores.
Pura Vida's ecommerce revenues were significantly affected by the shift in social and digital media effectiveness and rising digital media costs.
The company is reducing its cost structure, targeting annual savings of $15 to $25 million.
Vera Bradley
Vera Bradley
Vera Bradley Revenue by Segment
Revenue by Segment
VB Direct Revenue
CapyFin.comVB Indirect Revenue
CapyFin.com Forward Guidance
The Company expects the challenging macroeconomic environment to continue for the balance of the year and that it will take time to return the Pura Vida ecommerce business to growth. The company lowered its outlook for fiscal year 2023.
Positive Outlook
- Gross profit percentage of 54.5% to 55.0% compared to 53.3% in Fiscal 2022 primarily related to price increases.
- SG&A expense of $248 to $253 million compared to $258.8 million in Fiscal 2022 driven by cost reduction initiatives.
- Effective tax rate of between 23.0 and 24.0%.
- Maximizing the travel category, which is nearly back to pre-pandemic levels.
- Optimizing back-to-campus opportunities, with strategic assortment enhancements.
Challenges Ahead
- Consolidated net revenues of $490 to $505 million compared to $540.5 million in Fiscal 2022.
- Year-over-year Vera Bradley revenues are expected to decline between 5% and 7%.
- Pura Vida revenues are expected to decline between 12% and 16%.
- Consolidated operating income of $18.8 to $25.0 million compared to $30.1 million in Fiscal 2022.
- Consolidated diluted EPS of $0.35 to $0.50 compared to $0.57 last year.
Revenue & Expenses
Visualization of income flow from segment revenue to net income