<\/p>\n
\n\tReformation might still be new to Wall Street \u2014 and investors are continuing to feel out the company to see if they can get comfortable with the apparel sector again \u2014 but Hali Borenstein is already getting the hang of being chief executive officer of a public firm.<\/p>\n
\n\tFor one, she\u2019s getting over her own inclination to avoid any boastfulness.<\/p>\n
\n\t\u201cI get to tell our story more\u201d since Reformation went public in July, Borenstein told WWD on Thursday. \u201cI get to brag about the cool things our teams are doing every day, and that\u2019s actually pretty fun. I\u2019ve never had that before, and I\u2019m so proud of our team and what they accomplish.\u201d<\/p>\n
\n\tThis time, she\u2019s bragging about a third-quarter revenue increase of 19.1 percent, to $173.6 million \u2014 the company\u2019s 22nd straight quarter of double-digit growth and $3.9 million ahead of what analysts forecast, according to Yahoo Finance.<\/p>\n
\n\tThe tax impact of stock-based compensation after the IPO pushed Reformation to a loss of $1.1 million in the quarter ended Sept. 26. But adjusted earnings before interest, taxes, depreciation and amortization increased 64.2 percent to $23.1 million.<\/p>\n
\n\tReformation\u2019s active customer file expanded by 23.4 percent to 1.25 million as it opened seven stores, ending the quarter with 77 doors. The brand also has a wholesale business, which grew 40.8 percent to $20.8 million.<\/p>\n
\n\t\u201cWe\u2019re really pleased with the business,\u201d Borenstein said. \u201cThe growth was really broad-based across geographies, across categories and selling points.\u201d<\/p>\n
\n\tPart of the secret is Reformation\u2019s ability to react quickly to the market.<\/p>\n
\n\tBorenstein recalled how pop colors began to become more profitable last spring.<\/p>\n
\n\t\u201cWe started seeing traction; we began testing, in limited quantities, more colors. In late spring, late summer, we saw crazy momentum against purple. And so we quickly invested in more depth against the purple styles. We added purple to different silhouettes, different fabrications. And now if you go to our site, there is more purple than we\u2019ve ever had on our site and it\u2019s working exceptionally well.<\/p>\n
\n\t\u201cWe\u2019ve been able to bring the right colors to the site in a time when no retailer would ever invest in purple 12 months out like this without reason to support it because historically I\u2019ve never seen purple perform the way it\u2019s performing now. You would never have that kind of conviction\u201d with a more traditional retail model.<\/p>\n
\n\tThe brand is also always trying out \u201cnew ideas,\u201d which account for at least 10 percent to 20 percent of the assortment.<\/p>\n
\n\t\u201cThat gives us enough of an opportunity to constantly learn,\u201d the CEO said. \u201cWhat happens sometimes is brands, when they chase too much, they forget to learn and then the assortment can get stale.<\/p>\n
\n\t\u201cWe\u2019re feeling very good that we are entering the Q4 with a lot of momentum \u2014 the brand, the product assortment, it\u2019s really checking and working very well and excited about how we\u2019re going to close the year. We are raising guidance as well. It\u2019s both a reflection of the flow-through from the Q3 beat as well as the outperformance we\u2019ve seen quarter to date in Q4.\u201d<\/p>\n
\n\tFor the full year, Reformation is now looking for its revenues to grow by 20 percent to 21 percent to a range of $610 million to $612 million, above the $602 million to $606 million previously forecast.<\/p>\n
\n\tBefore the results were released on Thursday, shares of Reformation fell 8.5 percent to $16.85 during a massive tech rout in the market that nonetheless left the company comfortably ahead of its $15 IPO price.<\/p>\n
\n\tBorenstein said \u201chow we\u2019ve been able to turn retail on its head\u201d is resonating with its new investors, who will weigh in on the third-quarter results on Friday.<\/p>\n
\n\t\u201cOur willingness to do it differently, be brave, I think cuts through. And frankly, the strong financial profile is certainly a differentiator,\u201d she said. \u201cWhat we have to do is really prove out that we can continue to grow in a consistent way over time. We\u2019re still small. We do have the unfortunate position of so many fashion businesses before us have struggled in the public markets. And so there\u2019s a little bit of show me, prove it. And so that\u2019s the work we have to do. And we knew that going into the public markets that we would have this kind of uphill battle, but we like challenges around here.\u201d<\/p>\n
#Reformation #Reports #Sales #Growth #Raises #Guidance<\/p>\n","protected":false},"excerpt":{"rendered":"
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