Part I [Business](index=4&type=section&id=Item%201.%20Business) Vince Holding Corp. operates three brands (Vince, Rebecca Taylor, Parker) through wholesale and direct-to-consumer channels, significantly impacted by the COVID-19 pandemic in fiscal 2020, leading to revenue decline and impairment charges - The company operates three main brands: **Vince, Rebecca Taylor, and Parker**, with the latter two acquired on November 3, 2019[16](index=16&type=chunk) - **Nordstrom Inc.** accounted for **21% of net sales in fiscal 2020** and **22% in fiscal 2019**, highlighting significant wholesale partner dependency[17](index=17&type=chunk) - Significant non-cash impairment charges in fiscal 2020 included **$13.0 million for property, equipment, and ROU assets** and **$13.8 million for goodwill and intangible assets**, driven by the COVID-19 pandemic[21](index=21&type=chunk)[22](index=22&type=chunk) - The company implemented various liquidity management actions in response to the pandemic, such as **furloughs, salary reductions, and credit facility amendments**[29](index=29&type=chunk) [Our Brands and Segments](index=5&type=section&id=our_brands_and_segments) The company operates three reportable segments: Vince Wholesale, Vince Direct-to-consumer, and Rebecca Taylor and Parker - The company operates three reportable segments: **Vince Wholesale, Vince Direct-to-consumer, and Rebecca Taylor and Parker**[35](index=35&type=chunk) Net Sales by Segment (Fiscal 2020 vs. 2019) | Segment | 2020 Net Sales ($ thousands) | % of Total | 2019 Net Sales ($ thousands) | % of Total | | :--- | :--- | :--- | :--- | :--- | | Vince Wholesale | $105,737 | 48.1% | $166,805 | 44.4% | | Vince Direct-to-consumer | $86,326 | 39.3% | $133,412 | 35.6% | | Rebecca Taylor and Parker | $27,807 | 12.6% | $74,970 | 20.0% | | **Total Net Sales** | **$219,870** | **100.0%** | **$375,187** | **100.0%** | - As of January 30, 2021, the company operated **62 Vince stores** and **9 Rebecca Taylor stores**[27](index=27&type=chunk)[31](index=31&type=chunk) - New product creation for the **Parker brand was paused in fiscal 2020** to reallocate resources to Vince and Rebecca Taylor and conserve liquidity[33](index=33&type=chunk) [Sourcing, Manufacturing, and Distribution](index=7&type=section&id=sourcing_manufacturing_and_distribution) The company relies on over 50 third-party manufacturers, primarily in China, and operates through seven third-party distribution centers globally - The company contracts with **over 50 manufacturers across nine countries**, without owning any manufacturing facilities[50](index=50&type=chunk) - In fiscal 2020, **88% of products were produced in China**[50](index=50&type=chunk) - Operations utilize **seven third-party distribution centers** located across the U.S., Hong Kong, Canada, the United Kingdom, and Belgium[52](index=52&type=chunk) [Human Capital](index=8&type=section&id=human_capital) As of January 30, 2021, the company employed 497 individuals, with nearly half working in its retail stores - As of January 30, 2021, the company employed **497 individuals**, with **230 in retail stores**[58](index=58&type=chunk) [Risk Factors](index=9&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks from the COVID-19 pandemic, dependence on key wholesale partners, potential goodwill impairment, supply chain reliance on foreign manufacturing, IT control weaknesses, and its "controlled company" status [Risks Related to Business and Industry](index=9&type=section&id=risks_related_to_our_business_and_industry) Key business risks include the ongoing impact of COVID-19, high dependence on a few wholesale partners, potential further goodwill impairment, and an un-remediated material weakness in internal controls - The **COVID-19 pandemic continues to adversely affect business, financial condition, and operations** through store closures, reduced demand, and supply chain disruptions[64](index=64&type=chunk)[65](index=65&type=chunk) - A **significant portion of revenue depends on a few large wholesale partners**, with the largest accounting for **21% of total revenue in fiscal 2020**, posing a substantial revenue risk if lost[86](index=86&type=chunk) - **Goodwill and indefinite-lived intangible assets face further impairment risk**, following **$13.8 million in impairment charges in fiscal 2020** due to COVID-19[75](index=75&type=chunk) - A **material weakness in internal control over financial reporting**, first identified in fiscal 2016, remains un-remediated[94](index=94&type=chunk) [Risks Related to Supply Chain](index=18&type=section&id=risks_related_to_our_supply_chain) Supply chain risks include reliance on third-party logistics, extensive foreign sourcing (especially China), and concentration with a few key manufacturers - Reliance on **third-party logistics providers for distribution facilities**, especially in California, poses operational disruption risks[113](index=113&type=chunk) - **Extensive foreign sourcing, with 88% of products from China in fiscal 2020**, exposes the company to political instability, trade restrictions, tariffs, and supply chain disruptions[116](index=116&type=chunk)[117](index=117&type=chunk) - **Concentration risk exists with independent manufacturers**, as the **top five accounted for approximately 59% of finished products in fiscal 2020**[121](index=121&type=chunk) [Risks Related to Structure and Ownership](index=20&type=section&id=risks_related_to_our_structure_and_ownership) Structural risks include being a "controlled company" by Sun Capital, which holds significant influence, and obligations under a Tax Receivable Agreement - The company is a **"controlled company"**, with **Sun Capital Partners, Inc. affiliates owning approximately 72% of common stock**, granting them significant influence[130](index=130&type=chunk) - A **Tax Receivable Agreement obligates the company to pay Pre-IPO Stockholders 85% of certain tax benefits**, with an estimated potential payment of **approximately $32.6 million plus accrued interest**, contingent on future taxable income[124](index=124&type=chunk) [Properties](index=22&type=section&id=Item%202.%20Properties) The company leases all corporate and retail properties, operating 71 stores (62 Vince, 9 Rebecca Taylor) totaling 174,439 gross square feet as of January 30, 2021 - All corporate offices and showrooms in **New York, Los Angeles, and Paris are leased**[135](index=135&type=chunk) Company-Operated Retail Store Count as of Jan 30, 2021 | Brand | Type | Count | | :--- | :--- | :--- | | Vince | Full-Price | 47 | | Vince | Outlet | 15 | | **Vince Total** | | **62** | | Rebecca Taylor | Full-Price | 6 | | Rebecca Taylor | Outlet | 3 | | **Rebecca Taylor Total** | | **9** | | **Grand Total** | | **71** | [Legal Proceedings](index=24&type=section&id=Item%203.%20Legal%20Proceedings) A stockholder lawsuit from 2018, alleging misleading statements about an ERP system transition, was dismissed in September 2020, but the plaintiff's appeal is pending - A **stockholder lawsuit from 2018** concerning ERP system transition statements was dismissed in September 2020, with a **plaintiff's appeal currently pending**[140](index=140&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=24&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on the NYSE under "VNCE", has never paid cash dividends, and does not anticipate doing so due to growth plans and debt covenants - The company's common stock trades on the **NYSE under the symbol 'VNCE'**[144](index=144&type=chunk) - The company has **never paid cash dividends** and does not plan to in the foreseeable future, restricted by debt covenants[146](index=146&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Fiscal 2020 saw a **41.4% net sales decrease to $219.9 million** and a **$65.6 million net loss** due to COVID-19, leading to lower gross margin, significant impairment charges, and liquidity management actions [Results of Operations](index=27&type=section&id=results_of_operations) Fiscal 2020 saw net sales decline by **41.4%** to **$219.9 million**, gross profit decrease by **50.3%**, and a net loss of **$65.6 million**, driven by pandemic impacts and impairment charges Fiscal 2020 vs. Fiscal 2019 Financial Performance (in thousands) | Metric | Fiscal 2020 | Fiscal 2019 | Change (%) | | :--- | :--- | :--- | :--- | | Net Sales | $219,870 | $375,187 | (41.4)% | | Gross Profit | $88,597 | $178,430 | (50.3)% | | Gross Margin | 40.3% | 47.6% | -7.3 p.p. | | Loss from Operations | ($61,080) | ($20,390) | 199.6% | | Net (Loss) Income | ($65,649) | $30,396 | N/M | | Diluted (Loss) EPS | ($5.58) | $2.55 | N/M | - The **gross margin rate decreased** primarily due to **increased promotional activity (-550 bps)**, **inventory reserve adjustments (-160 bps)**, and **deleverage of supply chain costs (-150 bps)**[170](index=170&type=chunk)[176](index=176&type=chunk) - Significant impairment charges in fiscal 2020 included **$13.8 million for goodwill and intangible assets** and **$13.0 million for long-lived assets**[171](index=171&type=chunk)[172](index=172&type=chunk) [Performance by Segment](index=28&type=section&id=performance_by_segment) All segments experienced significant sales declines in fiscal 2020, with Rebecca Taylor and Parker seeing the largest drop, while Vince Direct-to-consumer's e-commerce grew Segment Performance (Fiscal 2020, in thousands) | Segment | Net Sales | Change vs. 2019 (%) | Income (Loss) from Operations | | :--- | :--- | :--- | :--- | | Vince Wholesale | $105,737 | (36.6)% | $30,059 | | Vince Direct-to-consumer | $86,326 | (35.3)% | ($20,734) | | Rebecca Taylor and Parker | $27,807 | (62.9)% | ($16,112) | - **Vince Wholesale sales declined** due to delayed/canceled orders from wholesale partner store closures and lower off-price shipments[179](index=179&type=chunk) - **Vince Direct-to-consumer sales decline** from store closures was partially mitigated by **over 25% e-commerce growth**[181](index=181&type=chunk) [Liquidity and Capital Resources](index=30&type=section&id=liquidity_and_capital_resources) Net cash used in operating activities was **$25.1 million** in fiscal 2020, with the company securing a new **$20 million subordinated term loan** and amending credit facilities to enhance liquidity Cash Flow Summary (Fiscal 2020 vs. 2019, in thousands) | Cash Flow Activity | Fiscal 2020 | Fiscal 2019 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | ($25,071) | $16,819 | | Net cash used in investing activities | ($3,497) | ($4,523) | | Net cash provided by (used in) financing activities | $31,787 | ($11,991) | - In December 2020, the company secured a **new $20 million subordinated term loan** (Third Lien Credit Facility) from a Sun Capital affiliate to enhance liquidity[191](index=191&type=chunk) - Multiple amendments were made to the **2018 Term Loan and Revolving Credit Facilities in 2020** to provide liquidity and adjust financial covenants due to the pandemic[187](index=187&type=chunk)[188](index=188&type=chunk) - As of January 30, 2021, **$24.75 million was outstanding under the 2018 Term Loan Facility** and **$40.4 million under the 2018 Revolving Credit Facility**[208](index=208&type=chunk)[223](index=223&type=chunk) [Critical Accounting Policies](index=38&type=section&id=critical_accounting_policies) Key accounting estimates involve revenue recognition reserves, inventory valuation, goodwill and intangible asset fair value, and the Tax Receivable Agreement liability - Key estimates include **revenue recognition reserves for allowances**, **inventory valuation for obsolescence**, and **fair value assessments for goodwill and intangible assets**[239](index=239&type=chunk)[243](index=243&type=chunk)[246](index=246&type=chunk) - A **Q1 2020 triggering event (COVID-19)** resulted in a **$9.5 million goodwill impairment for Vince Wholesale** and a **$4.4 million impairment for Vince and Rebecca Taylor tradenames**[250](index=250&type=chunk)[251](index=251&type=chunk)[252](index=252&type=chunk) - The **Tax Receivable Agreement obligation was reduced to $0** as of January 30, 2021, after a **$2.3 million downward adjustment in fiscal 2020** due to revised income projections[267](index=267&type=chunk) - A **full valuation allowance was maintained on all definite-lived deferred tax assets** as of January 30, 2021, due to uncertainty of recognition[269](index=269&type=chunk) [Controls and Procedures](index=43&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls were ineffective as of January 30, 2021, due to an un-remediated material weakness in IT general controls, specifically user access and segregation of duties - The **CEO and CFO concluded disclosure controls and procedures were not effective** as of January 30, 2021[276](index=276&type=chunk) - A **material weakness in internal control over financial reporting**, identified in fiscal 2016, persists due to **inadequate IT general controls**, specifically user access and segregation of duties[94](index=94&type=chunk)[282](index=282&type=chunk) - A **remediation plan is underway**, involving system access modifications and user access recertifications, but the material weakness remains un-remediated until all controls are effectively implemented and tested[285](index=285&type=chunk)[286](index=286&type=chunk) [Part III](index=45&type=section&id=PART%20III) Items 10 through 14, covering governance and compensation, are incorporated by reference from the definitive proxy statement for the 2021 annual meeting Part IV [Exhibits, Financial Statement Schedules](index=45&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section provides an index to the financial statements, schedules, and all exhibits filed with the Form 10-K, including governance documents and material contracts - This section provides the **index to Audited Consolidated Financial Statements** and a **comprehensive list of all exhibits** filed with the Form 10-K[297](index=297&type=chunk) Financial Statements and Supplementary Data [Report of Independent Registered Public Accounting Firm](index=52&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) PricewaterhouseCoopers LLP issued an unqualified opinion on the consolidated financial statements, highlighting critical audit matters related to impairment assessments for the Vince tradename, Vince Wholesale goodwill, and Right-of-Use assets - **PricewaterhouseCoopers LLP issued an unqualified opinion** on the consolidated financial statements[312](index=312&type=chunk) - Critical Audit Matters identified include **impairment assessments for the Vince Tradename**, **Vince Wholesale Reporting Unit goodwill**, and **Retail Store Asset Groups' Right-of-Use assets**[317](index=317&type=chunk)[318](index=318&type=chunk)[322](index=322&type=chunk)[325](index=325&type=chunk) [Consolidated Financial Statements](index=55&type=section&id=Consolidated%20Financial%20Statements) Fiscal 2020 consolidated financial statements show a significant decline, with total assets decreasing to **$332.9 million**, stockholders' equity to **$66.2 million**, a **$65.6 million net loss**, and **$25.1 million cash used in operations** Consolidated Balance Sheet Data (in thousands) | Account | Jan 30, 2021 | Feb 1, 2020 | | :--- | :--- | :--- | | Total Current Assets | $110,584 | $114,244 | | Total Assets | $332,944 | $362,302 | | Total Current Liabilities | $82,220 | $90,277 | | Total Liabilities | $266,737 | $231,522 | | Total Stockholders' Equity | $66,207 | $130,780 | Consolidated Statement of Operations Data (in thousands) | Account | Fiscal 2020 | Fiscal 2019 | | :--- | :--- | :--- | | Net Sales | $219,870 | $375,187 | | Gross Profit | $88,597 | $178,430 | | Loss from Operations | ($61,080) | ($20,390) | | Net (Loss) Income | ($65,649) | $30,396 | | Diluted (Loss) EPS | ($5.58) | $2.55 | [Notes to Consolidated Financial Statements](index=59&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies and financial results, including COVID-19's impact, impairment charges, the Rebecca Taylor and Parker acquisition, debt modifications, and the Tax Receivable Agreement liability reduction to zero - **Note 2:** The **acquisition of Rebecca Taylor and Parker** was accounted for as a transaction between commonly controlled entities, requiring retrospective financial statement combination[407](index=407&type=chunk) - **Note 3:** Fiscal 2020 saw a **$9.5 million goodwill impairment for Vince Wholesale** and a **$4.4 million impairment for Vince and Rebecca Taylor tradenames** due to COVID-19[410](index=410&type=chunk)[412](index=412&type=chunk)[414](index=414&type=chunk) - **Note 5:** The company **amended its 2018 Term Loan and Revolving Credit facilities multiple times in 2020** and secured a **new $20 million Third Lien Credit Facility** with a Sun Capital affiliate for liquidity and flexibility[431](index=431&type=chunk)[435](index=435&type=chunk)[453](index=453&type=chunk) - **Note 14:** The **Tax Receivable Agreement liability was reduced to $0** as of January 30, 2021, resulting in a **$2.3 million gain in fiscal 2020** due to revised income projections[521](index=521&type=chunk)[522](index=522&type=chunk)

Vince Holding Corp. (NYSE:VNCE) Q4 2020 Earnings Conference Call April 29, 2021 4:30 PM ET Company Participants Amy Levy - Vice President, Investor Relations Jack Schwefel - Chief Executive Officer David Stefko - Chief Financial Officer Conference Call Participants Dana Telsey - Telsey Advisory Group Operator Ladies and gentlemen, thank you for standing by, and welcome to Vince Q4 2020 Earnings Conference Call. [Operator Instructions] Thank you. I would now turn the conference over to Amy Levy. You may begi ...

Financial Data and Key Metrics Changes - Total company net sales for Q3 2020 decreased 34% to $69 million compared to $104.5 million in Q3 2019, showing significant improvement from a 59.9% decline in Q2 2020 [28] - Gross profit for Q3 was $31.7 million or 45.9% of net sales, down from $51 million or 48.8% in the same period last year, primarily due to increased promotional activity [31] - Net income for Q3 was $5 million or $0.42 per diluted share, compared to $6 million or $0.50 per diluted share in Q3 2019 [36] Business Line Data and Key Metrics Changes - Vince brand's consolidated net sales decreased 28.7% to $61.6 million compared to $86.4 million in the same prior year period [28] - Direct-to-consumer segment sales for Vince decreased 35.4% to $22.8 million in Q3 [28] - Rebecca Taylor and Parker combined net sales decreased 58.9% to $7.5 million compared to the same period last year [30] Market Data and Key Metrics Changes - International sales in Q3 were considerably less negative than in the U.S., indicating a stronger recovery in international markets [17] - The online business at wholesale partners remained strong, although in-store traffic continued to be challenged [12] Company Strategy and Development Direction - The company is focused on enhancing liquidity to support brand strategies, resulting in $42.3 million in excess availability under the revolving credit facility [8][37] - The strategy includes expanding the Vince brand's size offerings and enhancing the Rebecca Taylor brand through a cohesive collection and digital marketing efforts [11][22] - The company is strategically evaluating attractive real estate opportunities for new store openings, including short-term leases [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate challenges posed by COVID-19 and emphasized the importance of health and safety for customers and team members [9] - The company believes it is well-positioned to advance growth strategies as it emerges from the crisis in the latter half of 2021 [9][42] - Management noted that the brand remains a top performer in the contemporary luxury segment and is gaining market share [6][42] Other Important Information - The company took proactive steps to enhance liquidity, including entering into a $20 million Third Lien Credit Facility [37] - Net inventory at the end of Q3 was $88.6 million, up from $71.6 million at the end of Q3 2019, with a focus on working through seasonal inventory [40][41] Q&A Session Summary Question: Can you discuss the performance of specific categories in DTC and wholesale? - Management noted strong performance in sweaters and tops, with consumer response to promotions and new products being positive [46][47] Question: What is the breakdown of expense reductions? - The largest reduction came from payroll, with furloughs and a reduction in force contributing to the decrease [48][49] Question: How does the new credit facility affect interest expenses? - The new facility will increase interest expenses but will be paid in kind, allowing for a decline in cash interest costs [52] Question: What is the expected future split between DTC and wholesale? - Management did not provide a specific percentage but indicated strong performance in wholesale and ongoing investments in e-commerce [53][54]

PART I. FINANCIAL INFORMATION [Condensed Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) Presents unaudited condensed consolidated financial statements, reflecting COVID-19's impact on revenues, net losses, and asset impairments [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Balance sheet as of October 31, 2020, shows decreased total assets and stockholders' equity, driven by operating losses and impairments Condensed Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | October 31, 2020 | February 1, 2020 | | :--- | :--- | :--- | | **Total current assets** | $126,525 | $114,244 | | **Total assets** | $354,454 | $362,302 | | **Total current liabilities** | $85,877 | $90,277 | | **Long-term debt** | $92,823 | $48,680 | | **Total liabilities** | $281,308 | $231,522 | | **Total stockholders' equity** | $73,146 | $130,780 | [Condensed Consolidated Statements of Operations and Comprehensive Earnings (Loss)](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Earnings%20%28Loss%29) Net sales declined significantly due to COVID-19, with substantial impairment charges leading to a significant net loss Statement of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended Oct 31, 2020 | Three Months Ended Nov 2, 2019 | Nine Months Ended Oct 31, 2020 | Nine Months Ended Nov 2, 2019 | | :--- | :--- | :--- | :--- | :--- | | **Net sales** | $69,022 | $104,539 | $145,062 | $270,779 | | **Gross profit** | $31,654 | $50,997 | $60,994 | $132,243 | | **Income (loss) from operations** | $6,264 | $7,550 | $(57,162) | $(17,089) | | **Net earnings (loss)** | $4,963 | $6,001 | $(58,277) | $(21,288) | | **Diluted EPS** | $0.42 | $0.50 | $(4.96) | $(1.83) | - For the nine months ended October 31, 2020, the company recorded significant impairment charges totaling **$26,900 thousand** (**$13,800 thousand** for goodwill and intangibles, and **$13,000 thousand** for long-lived assets), contributing heavily to the net loss[12](index=12&type=chunk) [Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) Stockholders' equity decreased from $130,800 thousand at the beginning of the fiscal year to $73,100 thousand as of October 31, 2020, primarily due to the period's net loss - Total stockholders' equity fell by approximately **44%** from **$130,780 thousand** on February 1, 2020, to **$73,146 thousand** on October 31, 2020, mainly due to the accumulated deficit increasing from the period's net loss[16](index=16&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Significant cash outflow from operations due to net loss and inventory increase, offset by increased financing activities Cash Flow Summary (in thousands) | Cash Flow Activity | Nine Months Ended Oct 31, 2020 | Nine Months Ended Nov 2, 2019 | | :--- | :--- | :--- | | **Net cash (used in) provided by operating activities** | $(38,135) | $2,189 | | **Net cash used in investing activities** | $(2,560) | $(3,563) | | **Net cash provided by financing activities** | $40,851 | $1,983 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, COVID-19 impact, impairment charges, debt, segment performance, related party transactions, and subsequent events - The company operates three brands: Vince, Rebecca Taylor, and Parker. The acquisition of Rebecca Taylor and Parker in November 2019 was a transaction between commonly controlled entities, requiring retrospective combination of financial statements[27](index=27&type=chunk)[28](index=28&type=chunk) - Due to COVID-19's impact, the company recorded non-cash impairment charges of **$13,800 thousand** for goodwill and intangible assets and **$13,000 thousand** for property, equipment, and right-of-use assets during the nine months ended October 31, 2020[36](index=36&type=chunk)[37](index=37&type=chunk)[52](index=52&type=chunk) - Subsequent to the quarter end, on December 11, 2020, the company entered into a new **$20,000 thousand** subordinated term loan (Third Lien Credit Facility) with an affiliate of its majority stockholder, Sun Capital, to enhance liquidity[85](index=85&type=chunk)[112](index=112&type=chunk)[126](index=126&type=chunk) - The obligation under the Tax Receivable Agreement with Pre-IPO Stockholders was adjusted down by **$2,320 thousand** to an estimated total of **$0** as of October 31, 2020, due to revised projections of future pre-tax income[120](index=120&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses COVID-19's negative impact on sales and operations, detailing segment performance and liquidity measures taken [Results of Operations](index=30&type=section&id=Results%20of%20Operations) Net sales fell significantly in Q3 and YTD 2020, with gross margin contraction and substantial impairment charges leading to operating loss Q3 2020 vs Q3 2019 Performance (in thousands) | Metric | Q3 2020 | Q3 2019 | % Change | | :--- | :--- | :--- | :--- | | **Net Sales** | $69,022 | $104,539 | -34.0% | | **Gross Profit** | $31,654 | $50,997 | -37.9% | | **Gross Margin** | 45.9% | 48.8% | -290 bps | | **SG&A Expenses** | $25,390 | $43,447 | -41.6% | | **Income from Operations** | $6,264 | $7,550 | -17.0% | Nine Months 2020 vs 2019 Performance (in thousands) | Metric | YTD 2020 | YTD 2019 | % Change | | :--- | :--- | :--- | :--- | | **Net Sales** | $145,062 | $270,779 | -46.4% | | **Gross Profit** | $60,994 | $132,243 | -53.9% | | **Gross Margin** | 42.0% | 48.8% | -680 bps | | **Loss from Operations** | $(57,162) | $(17,089) | -234.5% | - The decrease in SG&A expenses was driven by cost-saving measures in response to COVID-19, including reduced compensation and benefits (**$7,700 thousand** in Q3), lower rent and occupancy costs (**$4,200 thousand** in Q3), and decreased marketing and travel expenses[149](index=149&type=chunk)[155](index=155&type=chunk) [Performance by Segment](index=32&type=section&id=Performance%20by%20Segment) All segments experienced significant sales declines in Q3 and YTD 2020 due to COVID-19, despite e-commerce growth in one segment Net Sales by Segment - Q3 (in thousands) | Segment | Q3 2020 | Q3 2019 | % Change | | :--- | :--- | :--- | :--- | | **Vince Wholesale** | $38,746 | $51,102 | -24.2% | | **Vince Direct-to-consumer** | $22,822 | $35,302 | -35.4% | | **Rebecca Taylor and Parker** | $7,454 | $18,135 | -58.9% | Net Sales by Segment - Nine Months (in thousands) | Segment | YTD 2020 | YTD 2019 | % Change | | :--- | :--- | :--- | :--- | | **Vince Wholesale** | $66,598 | $121,850 | -45.3% | | **Vince Direct-to-consumer** | $55,958 | $91,027 | -38.5% | | **Rebecca Taylor and Parker** | $22,506 | $57,902 | -61.1% | - Despite reduced traffic in retail locations, the Vince Direct-to-consumer segment saw **mid-teens growth** in e-commerce sales in Q3 and **over 30% growth** for the nine-month period[159](index=159&type=chunk)[172](index=172&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) COVID-19 significantly impacted liquidity, leading to cash usage from operations, credit facility amendments, and new subordinated debt - Net cash used in operating activities was **$38,100 thousand** for the nine months ended Oct 31, 2020, compared to net cash provided by operating activities of **$2,200 thousand** in the prior-year period[185](index=185&type=chunk)[186](index=186&type=chunk) - On June 8, 2020, the company amended its 2018 Revolving Credit Facility and 2018 Term Loan Facility to, among other things, temporarily increase borrowing availability and suspend certain financial covenants[177](index=177&type=chunk) - On December 11, 2020, the company entered into a new **$20,000 thousand** Third Lien Credit Facility with SK Financial, an affiliate of Sun Capital, and executed the Fifth Amendments to its existing credit facilities to extend covenant relief and revise terms[178](index=178&type=chunk)[179](index=179&type=chunk)[180](index=180&type=chunk) [Quantitative and Qualitative Disclosure About Market Risk](index=43&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosure%20About%20Market%20Risk) As a "smaller reporting company," the company is not required to provide this information - As a "smaller reporting company," the company is exempt from the requirement to provide quantitative and qualitative disclosures about market risk[219](index=219&type=chunk) [Controls and Procedures](index=43&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were ineffective due to material weaknesses in IT general controls, with remediation efforts ongoing - The CEO and CFO concluded that disclosure controls and procedures were not effective as of October 31, 2020[222](index=222&type=chunk) - The ineffectiveness is due to material weaknesses in internal control over financial reporting concerning IT program change management and user access controls, which could impact segregation of duties[224](index=224&type=chunk) - During the quarter, the company completed the transition of the Acquired Businesses' ERP system to its existing system, which constituted a material change in internal control over financial reporting[231](index=231&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=41&type=section&id=Item%201.%20Legal%20Proceedings) Stockholder lawsuit alleging misleading statements was dismissed, but plaintiff filed appeals which are currently pending - A stockholder lawsuit alleging misleading statements about an ERP system transition was dismissed in its entirety on September 9, 2020[97](index=97&type=chunk)[233](index=233&type=chunk) - The plaintiff filed notices of appeal on October 6, 2020, and the appeals are currently pending[97](index=97&type=chunk)[233](index=233&type=chunk) [Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) COVID-19 pandemic adversely affects business, financial condition, and operations, posing risks to stores, demand, inventory, and liquidity - The primary risk factor discussed is the ongoing and uncertain negative impact of the COVID-19 pandemic on all aspects of the business[237](index=237&type=chunk) - Specific risks cited include temporary store closures, reduced consumer demand for luxury goods, excess inventory, supply chain disruptions, and the ability to access capital and maintain compliance with credit facilities[237](index=237&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=43&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities or use of proceeds to report for the period - None[239](index=239&type=chunk) [Defaults Upon Senior Securities](index=43&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities to report for the period - None[240](index=240&type=chunk) [Mine Safety Disclosures](index=43&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[241](index=241&type=chunk) [Other Information](index=43&type=section&id=Item%205.%20Other%20Information) No other information to report for the period - None[242](index=242&type=chunk) [Exhibits](index=43&type=section&id=Item%206.%20Exhibits) Lists exhibits filed with Form 10-Q, including CEO certifications and financial statements in XBRL format - Exhibits filed include CEO certifications (31.1, 32.1) and financial statements in XBRL format (101.1)[243](index=243&type=chunk)

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended August 1, 2020 Or Commission File Number: 001-36212 VINCE HOLDING CORP. (Exact name of registrant as specified in its charter) Delaware 75-3264870 (State or other jurisdiction of incorporation or organization) (I.R.S. ...

Vince Holding Corp. (NYSE:VNCE) Q1 2020 Earnings Conference Call June 16, 2020 4:30 PM ET Company Representatives Brendan Hoffman - Chief Executive Officer David Stefko - Chief Financial Officer Amy Levy - Vice President, Investor Relations Conference Call Participants Dana Telsey - Telsey Advisory Group Operator Ladies and gentlemen, thank you for standing by and welcome to Vince Q1 2020, Preliminary Results Conference Call. At this time all participants are in a listen-only mode. After the speaker present ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended February 1, 2020 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-36212 VINCE HOLDING CORP. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) Delaware 75-3264870 (I.R.S ...

Management Presentation JANUARY 2020 DISCLAIMER This Management Presentation (this "Presentation") is the property of Vince Holding Corp. and its subsidiaries (collectively, "Vince" or the "Company"). By accepting this Presentation, the recipient acknowledges that it has read, understood and accepted the terms of this disclaimer. This Presentation is not a formal offer to sell or solicitation of an offer to buy the Company's securities. Information contained in this Presentation should not be relied upon as ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION For the quarterly period ended November 2, 2019 Or FORM 10-Q WASHINGTON, D.C. 20549 ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-36212 VINCE HOLDING CORP. (Exact name of registrant as specified in its charter) Delaware 75-3264870 (State or other jurisdiction of incorporation or organization) (I.R.S ...

Vince Holding Corp. (NYSE:VNCE) Q2 2019 Earnings Conference Call September 12, 2019 4:30 PM ET Company Participants Amy Levy - VP, Investor Relations Brendan Hoffman - Chief Executive Officer Dave Stefko - Chief Financial Officer Conference Call Participants Dana Telsey - Telsey Advisory Group Operator Good afternoon. My name is Chris and I will be your conference operator today. At this time, I would like to welcome everyone to the Vince Q2 2019 Earnings Conference Call. All lines have been placed on mute ...