A.K.A. Brands Holding Corp. said it expects to show a loss in the second quarter ended June 30 as sales increased 6 percent. Current brands in the A.K.A. Brands portfolio include Princess Polly, Culture Kings, mnml, Petal & Pup, and Rebdolls.
For the second quarter of fiscal 2022:
- Net sales grew 6 percent to approximately $158.5 million compared to last year, 11 percent in constant currency on top of 76 percent growth last year Pro-forma for the acquisition of Culture Kings;
- A.K.A. Brands expects a net loss of approximately $4.2 million; and
- A.K.A. Brands expects an adjusted EBITDA of approximately $5.9 million.
“We delivered double-digit revenue growth in constant currency for the second quarter on top of tremendous growth last year; however, growth slowed from the prior quarter, and net sales missed our expectations,” said Jill Ramsey, CEO, A.K.A. Brands. “Sales were impacted by inflationary pressures on the consumer, shifts in spending and a slower than expected recovery in Australia. Additionally, lower return on marketing investments, a competitive promotional environment and higher merchandise returns led us to reduce our outlook for Adjusted EBITDA.”
Ramsey continued, “despite macro pressures, we remain encouraged by the strong growth in active customers as we continue to attract and retain consumers, particularly in the U.S. Although we anticipate headwinds will continue through the remainder of the year, we expect sequential improvement in Adjusted EBITDA rates as we optimize marketing investments, maintain disciplined inventory controls and tighten expenses. We remain highly confident that our strategies and the investments we are making will drive profitable growth long term due to our portfolio of strong digital brands, the flexibility of our business model and the talent of our teams.”
The company will provide full results on August 10.
