Vera Bradley, Inc. reported sales of Pure Vida declined 3.6 percent year-over-year in the second quarter ended July 30 to $25.1 million, primarily related to a decline in wholesale revenues.
Pure Vida saw a modest decline in e-commerce sales while new store growth resulted in non-comparable retail store sales gains.
Vera Bradley’s CEO, Jackie Ardrey, said the company expects Pure Vida’s wholesale sales to improve in the second half of the year. She added that the jewelry, clothing and accessories maker store sales remained strong, helped by changes in its performance-based marketing program. Pura Vida operates five stores in San Diego, CA; Irvine, CA; Myrtle Beach, SC; Gilbert, AZ; and Camarillo, CA.
Vera Bradley acquired a majority stake in Pura Vida in 2019. In January of this year, it acquired the remaining 25 percent interest in Pupa Vida from founders Griffin Thall and Paul Goodman for $10 million.
Pura Vida’s operating income was $4.0 million, or 15.9 percent of Pura Vida’s revenues, in the quarter compared to an operating loss of $28.5 million in the prior year. On a non-GAAP basis, Pura Vida’s operating income was $4.8 million, or 19.2 percent of Pura Vida revenues, compared to $2.6 million, or 9.8 percent of revenues, in the prior year.
Consolidated net revenues for both the Vera Bradley and Pura Vida brands totaled $128.2 million in the quarter, down 1.7 percent compared to $130.4 million in the prior year’s second quarter ended July 30, 2022.
Vera Bradley, Inc.’s consolidated net income in the quarter totaled $9.3 million, or 30 cents per share. These results included $0.9 million of net after-tax charges, comprised of $0.6 million for the amortization of definite-lived intangible assets, $0.2 million of consulting fees primarily associated with strategic initiatives, and $0.1 million of severance charges. On a non-GAAP basis, Vera Bradley, Inc.’s consolidated second-quarter net income totaled $10.2 million, or $0.33 per diluted share.
The consolidated net loss in the year-ago quarter totaled $29.8 million, or 95 cents per share, including $32.2 million of net after-tax charges. The charges were comprised of $18.2 million of Pura Vida goodwill and intangible asset impairment charges, $4.7 million of inventory adjustments associated with the exit of certain technology products and the write-off of excess mask inventory, $4.7 million of severance charges and other employee costs, and $2.3 million of consulting fees associated with cost savings initiatives and CEO search. Smaller charges included $0.9 million of purchase order cancellation fees for spring 2023 goods, $0.6 million of store impairment charges, $0.5 million of intangible asset amortization, and $0.3 million of goodMRKT exit costs. On a non-GAAP basis, net income totaled $2.4 million, or 8 cents, a year ago.
Photo courtesy Pure Vida
