Improved profitability in fiscal 2020 and demonstrated strength of omni-channel capabilities with eCommerce sales up more than 60% for the quarter
TORONTO, April 8, 2021 /CNW/ - Roots(“Roots,“ “Roots Canada“ or the “Company“) (TSX:ROOT), a premium outdoor-lifestyle brand, today announced its financial results for its fiscal year and fourth quarter ended January 30, 2021 (“F2020“ and “Q4 2020“, respectively). All financial results are reported in Canadian dollars unless otherwise stated. Certain metrics, including those expressed on an adjusted basis, are non-IFRS measures. See “Non-IFRS Measures and Industry Metrics“.
Fiscal 2020 Business Highlights
- Demonstrated strength of the Company's market position around comfort and quality with increased demand for major product categories and positive sell-throughs of new products, driving substantial gross margin expansion.
- Increased eCommerce sales 50% year-over-year, partially offsetting the impact of pandemic-related store closures for 31% of the year (35% for Q4 2020), and generated nearly 50% of F2020 Direct-to-Consumer (“DTC“) sales online, facilitated by the Company's omni-channel platform.
- Improved profitability year-over-year by actively managing costs across all areas of the business.
- Achieved profitability in the U.S. with transition to a digitally-led strategy, including closing seven stores, which resulted in the elimination of significant Adjusted EBITDA losses and eCommerce growth rates in excess of 65% in the fourth quarter.
- Effectively managed liquidity with a 53% year-over-year increase in available liquidity as at the end of F2020 and a reduction in leverage from 3.7x fiscal 2019 (“F2019“) Adjusted EBITDA to 1.6x F2020 Adjusted EBITDA.
- Repurposed a portion of Company-operated leather factory for non-medical face mask production, establishing a new revenue stream and donating a portion of the proceeds to charity
- Donated more than $2.0 million in products and financial support to charitable organizations across Canada.
Fiscal 2020 Financial Highlights
- Total sales of $240.5 million, compared to $329.9 million in F2019.
- DTC sales of $208.2 million, compared to $287.8 million in F2019.
- Gross margin of 58.1%, compared to 53.4% in F2019.
- DTC Gross Margin of 61.1%, up 490 basis points from 56.2% in F2019.
- Selling, general and administrative expenses of $113.9 million (excluding fixed asset impairment of $0.9 million), down from $169.1 million in F2019 (excluding fixed asset impairment of $19.2 million).
- Adjusted EBITDA of $38.7 million, a 48.6% increase from $26.1 million in F2019.
- Net income per share of $0.31, improved from a net loss per Share of ($1.47) in F2019.
- Adjusted Net Income per Share of $0.39, improved from $0.10 per Share in F2019.
Fourth Quarter Fiscal 2020 Highlights
- Total sales of $99.4 million, compared to $127.5 million in the fourth quarter offiscal 2019 (“Q4 2019“).
- DTC sales of $91.8 million, compared to $119.1 million in Q4 2019.
- Gross margin of 59.2%, compared to 54.4% in Q4 2019.
- DTC Gross Margin of 59.8%, up 460 basis points from 55.2% in Q4 2019.
- Selling, general and administrative expenses of $38.1 million (excluding fixed asset impairment of $0.9 million), down from $50.2 million in Q4 2019 (excluding fixed asset impairment of $19.2 million).
- Adjusted EBITDA of $26.1 million, in line with $26.1 million in Q4 2019.
- Net income per share of $0.29, improved from a net loss per Share of ($1.06) in Q4 2019.
- Adjusted Net Income per Share of $0.39, improved from $0.31 per Share in Q4 2019.