Lands’ End maintains momentum in Q4; plans major store expansion
Lands’ End is on the comeback trail.
For its fourth quarter, the apparel retailer recorded its third straight period of sales growth after 11 consecutive quarters of declines.
Net income was $39.8 million, compared to a loss of $94.8 million in the year-ago period.
Net revenue increased 11.3% to $510.6 million (the period included an extra week). Direct segment revenue increased 14.3% to $455.6 million. Retail segment revenue decreased 8.7% to $55.1 million compared to the same period last year, primarily due to fewer Lands' End Shops at Sears. Same-store sales rose 5.0%.
Operating some 180 shops in Sears stores, Lands’ End sales have been under pressure as the chain continues to shrink its store portfolio. (Lands’ End was acquired by Sears in 2002 but was spun off by the struggling retailer in 2014.) Moving forward, Lands’ End is taking its brick-and-mortar footprint into its hands, with plans to open 40 to 60 locations over the next five years.
“We will put our retail destiny firmly in our own hands as Sears continues to close locations,” CEO Jerome Griffith said on the company’s quarterly conference call with analysts. “Our real estate team is exploring opportunities and locations where we have strong brand recognition, focusing on high-traffic areas and convenience.”
Lands’ End will open its new store prototype in the second quarter, in Chicago, Griffith said, with four to six stores planned to open over the course of the year.
“As we open stores throughout the year, we will leverage our customer data and analytics to ensure that our locations are ideal for the brand and our customer base,” he told the analysts.
For the full year, Lands’ End earned $28.2 million, or 88 cents a share, on sales of $1.4 billion, compared with a net loss of $109.8 million, or $3.43 a share, on $1.3 billion in sales last year.