Financial Performance - Net revenues for fiscal 2019 were $416.1 million, a decrease of 8.5% from $454.6 million in fiscal 2018[195] - Gross profit for fiscal 2019 was $238.6 million, down from $254.0 million in fiscal 2018, reflecting a gross margin of 57.2%[195] - Operating income increased to $27.1 million in fiscal 2019, compared to $15.0 million in fiscal 2018[195] - Net income for fiscal 2019 was $20.8 million, up from $7.0 million in fiscal 2018[209] - Comparable sales decreased by 10.3% in fiscal 2019, compared to a decrease of 6.7% in fiscal 2018[195] - Gross profit was $238.6 million, representing 57.3% of net revenues, compared to 55.9% in fiscal 2018[209] - Operating income increased to $27.1 million (6.5% of net revenue) in fiscal 2019 from $15.0 million (3.3% of net revenue) in fiscal 2018[209] - For fiscal 2019, net income increased by $13.8 million, or 195.9%, to $20.8 million from $7.0 million in fiscal 2018[256] Expenses and Cost Management - Selling, general, and administrative (SG&A) expenses were reduced to $212 million in fiscal 2019, down from $239.8 million in fiscal 2018[204] - SG&A expenses decreased by $27.8 million, or 11.6%, to $212.0 million in fiscal 2019 from $239.8 million in fiscal 2018[243] - Unallocated corporate expenses decreased by $5.5 million, or 6.8%, primarily due to non-recurring expenses from the prior year[252] - Interest income increased by $0.7 million, or 172.4%, to $1.1 million in fiscal 2019 from $0.4 million in fiscal 2018[253] Cash Flow and Investments - The company generated operating cash flow of $43.6 million during fiscal 2019[204] - Cash, cash equivalents, and investments increased to $156.6 million at the end of fiscal 2019 from $138.4 million at the end of fiscal 2018[209] - Net cash provided by operating activities for fiscal 2019 was $43.6 million, compared to $42.6 million in fiscal 2018[279] - Cash flows from operating activities were $43,564 thousand in 2019, slightly up from $42,642 thousand in 2018, indicating a growth of 2.2%[350] Store Operations - The total number of stores open at the end of fiscal 2019 was 156, down from 160 at the end of fiscal 2018[195] - Total stores opened during the period were 6, while 10 stores were closed, resulting in 156 stores open at the end of fiscal 2019[220] - The company closed a total of 15 underperforming full-line stores and one factory outlet store since the beginning of fiscal 2018, with a forecast to close up to an additional 30 full-line stores by the end of fiscal 2022[228] - As of February 2, 2019, Vera Bradley operated 99 full-line stores and 57 factory outlet stores in the United States[354] Strategic Initiatives - The company launched a customization program allowing customers to design their own bags[204] - Vision 20/20 strategic plan was launched to improve product and pricing initiatives, impacting fiscal 2019 revenues negatively[226][227] - The company plans to close up to 30 additional full-line stores by fiscal 2022 as part of its Vision 20/20 initiatives[298] Revenue Recognition and Accounting - The company’s revenue recognition follows a five-step model as per ASC Topic 606, ensuring compliance with accounting standards[368] - The Company adopted the new revenue recognition standard in the first quarter of fiscal 2019, resulting in a $0.5 million cumulative adjustment to beginning retained earnings[390] - Revenue recognition for unredeemed gift cards is now based on historical redemption patterns, leading to accelerated recognition of gift card breakage revenue[392] - The Company no longer adjusts revenue for shipments not yet received, recognizing revenue upon shipment when control is passed to the customer[391] Taxation - The effective tax rate for fiscal 2019 decreased to 26.5% from 54.4% in fiscal 2018, primarily due to the reduction in the U.S. corporate income tax rate to 21%[254] - The Tax Act reduced the corporate tax rate from 35% to 21%, resulting in a provisional income tax expense of $2.1 million recorded in Q4 of fiscal 2018[312] - The company includes interest and penalties related to uncertain tax positions in income tax expense[387] Inventory and Assets - The balance of inventory adjustments decreased to $0.6 million as of February 2, 2019, from $2.7 million in the prior year, reflecting reduced clearance activity and increased full-price purchasing[310] - Total assets increased to $362,148 thousand in 2019 from $350,669 thousand in 2018, representing a growth of 3.4%[339] - Shareholders' equity grew to $294,703 thousand in 2019, compared to $285,283 thousand in 2018, an increase of 3.0%[339] Marketing and Advertising - Total impressions from marketing efforts increased by over 50% to more than 2.1 billion for the fiscal year[204] - For the fiscal year ended February 2, 2019, the total advertising expense was $27.488 million, an increase from $26.953 million in the previous fiscal year[378]