RYU Apparel Inc. reported revenue for the year ended December 31 reached $5.05 million, 67 percent higher than revenue of $3.0 billion in 2017.
All figures are in Canadian dollars.
Fourth quarter 2018 results included additional revenue from the company’s new retail locations in Williamsburg, Brooklyn in New York City, and CF Sherway Gardens in Toronto, Ontario.
The fourth quarter of 2018 is RYU’s thirteenth quarter of increasing revenue and of increasing gross profit.
“We are delighted with this quarter and yearly results and the constant progress we are making in our strategic plan,” said Marcello Leone, CEO. “Moving forward, RYU remains focused and we have a solid execution plan in place to position the brand for success. As creators of Urban Athletic Apparel, we are growing day after day and we are thrilled about our next steps.”
During the year ended December 31, 2018 the company achieved the following milestones:
- RYU met its retail store expansion target of eight retail locations by the end of 2018 beginning with the opening of its first U.S. retail location on Abbot Kinney Boulevard in Venice, CA on August 2, 2018. This was followed by its first location in New York City, in Williamsburg, Brooklyn, on November 15, 2018. The third new retail location for the year was CF Sherway Gardens on December 14, 2018 as the second Toronto, Ontario location and first enclosed mall location in the City.
- During the year ended December 31, 2018 e-commerce revenue represented 14 percent of total revenue and its efforts yielded a 42 percent growth in e-commerce revenue against the year ended December 31, 2017.
- The company, in August 2018, launched its first global marketing campaign, #YourUniverse, which gained strong attention by the media and generated articles, social media impressions and projected RYU on the radar of the key publications in North America.
- The company continued to expand its revenues through strategic partnerships with key wholesale accounts, such as Nordstrom, Equinox gyms, Rise by We (WeWork) and Steve Nash Fitness Clubs.
- Commencing October 8th, 2018, RYU’s common shares began trading on the OTCQB Marketplace under the trading symbolOTCQB: RYPPF. RYU provided this platform to existing and prospective US shareholders to align its corporate structure with its business expansion in the US retail marketplace.
Fourth quarter summary:
- Fourth quarter revenue of $$1,773,589 compared with $1,166,126 in the same period in fiscal 2017. Revenue increased by 52 percent as it included sales from new retail locations. The company opened the quarter with six versus five retail stores, while one more opened exactly at the middle of the quarter and the eight overall location opened for just a couple of weeks before the conclusion of the quarter. Growth in e-commerce sales was constant.
- The fourth quarter of 2018 marks RYU’s thirteenth consecutive quarter of increasing gross profit. Fourth quarter gross profit of $659,725 compared with $529,472 in the same period in fiscal 2016, an increase of 25 percent.
- Fourth quarter expenses of $5,946,071 compared with $3,082,668 in the same period in fiscal 2017. The increase of 93 percent is primarily due to the expansion of its retail operations from five to nine stores (advancing the costs for the ninth, opened in early January 2019).
- Fourth quarter comprehensive loss was $5,286,346 compared with $2,553,196 in the same period in fiscal 2017. The $2,733,150 increase is due to higher selling and marketing expenses, variances in gross profit net of higher occupancy costs and depreciation from running eight retail stores versus five as well as additional manpower needs.
Annual summary:
- Revenue of $5,047,600 compared with $3,019,586 in fiscal 2017. Revenue increased by 67 percent as it included sales from eight stores (two of them open for respectively 6 and 2 weeks, only) versus five retail stores and growth in e-commerce sales. The Abbot Kinney – Venice location in Los Angeles opened August 2018, the Williamsburg location in New York opened November 2018, and the Sherway Gardens store in Toronto opened December 2018.
- Gross profit of $2,393,851 compared with $1,382,293 in fiscal 2017, an increase of 73 percent. Gross profit percentage increased to 47 percent in the year ended December 31, 2018 from 46 percent at the end of 2017, due to improving starting margins.
- Expenses of $21,720,528 compared with $10,590,853 in fiscal 2017. The increase is due to the increase in retail operations from five to eight stores
(including the location which opened in early January 2019), investment in additional manpower, and the development of our 2018 marketing strategy. - Comprehensive loss was $19,326,677 compared with $9,200,856 in fiscal 2016. The increase in comprehensive loss is due to investment in the scale of its business. This increase quantified as $10,125,821 is mostly due to higher share-based payments $2,293,227 (a non-cash item), higher selling and marketing expenses of $2,373,017, and variances in gross profit net of higher occupancy costs and depreciation from running eight retail stores versus five as well as additional manpower needs. Without the effect of non-cash items, comprehensive loss in the year ended December 31, 2018 increased by 85 percent (vs 103 percent) to $15,575,150, from $8,414,207. The increase is due to investment in the scale of its business.
The company provided the following 2019 updates:
- RYU successfully opened its ninth retail location located at Fashion Island in Newport Beach, CA on January 22, 2019.
- The new RYU.com, with improved functionality, user experience, speed and branding launched on February 13, 2019, in collaboration with creative agency netamorphosis from New York City.
- RYU currently has two retail locations under construction in Southern California and both are set to open in the summer of 2019. This continued expansion gives RYU increasing exposure in Vancouver, Toronto, New York City and Los Angeles as the most important urban centers on both coasts of Canada and the US.
RYU relaunched in November 2015.
