Torrid (US:CURV)2021-12-09 00:34Financial Data and Key Metrics Changes - Net sales grew 13% year-over-year to $306 million, and increased 19% compared to 2019 [11][45] - Adjusted EBITDA was $55 million, up from $31 million last year, with an adjusted EBITDA margin of 18%, an increase of nearly 700 basis points [12][52] - Gross profit was $125 million, representing 40.9% of net sales, compared to 35.4% last year [47][48] - Net loss for the quarter was $59 million, or $0.54 per share, compared to net income of $4 million last year [54] Business Line Data and Key Metrics Changes - Comparable sales increased by 14%, marking the 37th positive comp in the last 39 quarters [11] - The Curve business saw significant growth, with marketing campaigns driving sales in the bra category [16][18] - Strength in casual offerings, including denim and active lounge, was noted, with a favorable response to the third Lovesick collection [19][20] Market Data and Key Metrics Changes - E-commerce and store productivity remained strong, with increased store traffic and performance exceeding expectations [68] - New store openings contributed to over a third of sales from new customers, with 90% of the store base being profitable [34][35] Company Strategy and Development Direction - The company aims to expand its Curve business, deepen customer relationships, increase brand awareness, and leverage its infrastructure [14][37] - Plans to launch in-store bra fitting events and a dedicated Curve experience on the website next year [18] - The omni-channel strategy remains core to customer acquisition and brand engagement, with continued improvements in e-commerce capabilities [38] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing global supply chain challenges but expressed confidence in navigating these issues [40][41] - The company expects supply chain headwinds to continue into the first half of 2022 but remains focused on delivering products to customers [41] - For the full year, net sales guidance is narrowed to between $1.29 billion and $1.3 billion, with adjusted EBITDA guidance at $252 million to $257 million [59][60] Other Important Information - The company announced a share repurchase program of up to $100 million [63] - Capital expenditures are expected to be approximately $23 million for fiscal 2021, reflecting new store openings and closures [62] Q&A Session Summary Question: Can you quantify the incremental pressure in 3Q? - Management indicated that pressures related to store occupancy and wage costs would continue into Q4, with proactive measures being taken to mitigate costs [28][29] Question: How did e-commerce and stores perform relative to expectations? - Both channels performed strongly, with increased productivity from stores as customers returned [68] Question: What was the impact of supply chain issues on revenue? - Delays in inventory were primarily responsible for revenue performance, not a pullback in consumer demand [72][73] Question: Which product categories were most impacted by supply chain issues? - Categories such as intimates, bras, denim, and shoes faced delays, but overall, the impact was widespread [82] Question: How are customer acquisition costs trending? - An increase in customer acquisition costs was anticipated, particularly in Q4, but the company planned for this in its strategy [87][88] Question: What is the outlook for store openings and real estate? - The company remains on track to open approximately 25 stores in 2022, with positive trends in new store performance [109]