Vince swings back to black in Q3, continues transformation phase post-Rebecca Taylor closure

Vince Holdings said on Wednesday sales dropped 14.7% to $84.1 million in the third quarter, as the U.S. fashion firm continues to rollout its transformation plan following its majority stake sale to Authentic Brands Group.

The New York-based company said the double-digit decline was driven by a 100% decrease in Rebecca Taylor and Parker segment sales, combined, due to the previously announced wind down of the Rebecca Taylor business, partially offset by a 6.2% decrease in Vince brand sales.

By channel, ​wholesale segment sales decreased 9.4% to $49.8 million, while direct-to-consumer segment sales decreased 1.2% to $34.2 million compared to the third quarter last year.

The company swung back to black during the three months ending October 28,​ posting a net income of $1 million or $0.08 per diluted share, compared to a net loss of $5.2 million or $0.43 per share in the same period last year. 

“We are pleased with our third quarter performance and the sequential improvement we delivered compared to the prior quarter despite incurring the first full period of royalty expenses,” said Jack Schwefel, chief executive officer of Vince Holding.

“We are in the early stages of implementing our transformation program which we expect to yield significant cost savings over the next three years to help to offset the changes to our cost structure given the royalty fees with our partnership with Authentic Brands Group. As we look ahead, we remain encouraged by the trends that we are seeing in the business as we continue to focus on driving improved profitability and positioning the company for long-term success.”

In April, New York brand management firm Authentic Brands acquired the intellectual property of the Vince brand, resulting in the establishment of a new subsidiary named ABG Vince.

Under the deal, Authentic is now the licensing partner for the brand’s core categories, and will manage its 60-plus retail stores, current wholesale accounts and e-commerce operations. The agreement spans an initial ten-year term with eight renewal options.