Release – Vera Bradley Announces First Quarter Fiscal Year 2024 Results

Research News and Market Data on VRA

Jun 7, 2023

Consolidated net revenues totaled $94.4 million

Net loss totaled ($4.7) million, or ($0.15) per diluted share; non-GAAP net loss totaled ($2.6) million, or ($0.09) per diluted share

Balance sheet remains strong, with cash and cash equivalents of $25.3 million, no debt, and year-over-year inventories down 11.8%

Management increases guidance for fiscal year

FORT WAYNE, Ind., June 07, 2023 (GLOBE NEWSWIRE) — Vera Bradley, Inc. (Nasdaq: VRA) today announced its financial results for the first quarter ended April 29, 2023.

In this release, Vera Bradley, Inc. or “the Company” refers to the entire enterprise and includes both the Vera Bradley and Pura Vida brands. Vera Bradley on a stand-alone basis refers to the Vera Bradley brand.

First Quarter Comments

Jackie Ardrey, Chief Executive Officer of the Company, noted, “We are pleased that meaningful gross margin expansion and diligent expense control led to significant year-over-year improvement in bottom-line performance for the quarter.

“On the revenue side, Vera Bradley factory stores experienced challenging traffic trends in March and April that led to weaker-than-expected performance for the quarter. This was partially offset, however, by several positive highlights in other areas of our business.

“First, we experienced our first positive quarterly revenue performance in five quarters at Pura Vida, primarily driven by non-comparable retail store sales. We also saw improved year-over-year sales trends in both our Pura Vida wholesale and e-commerce channels. Second, we delivered strong Vera Bradley e-commerce performance and solid Vera Bradley full-line store revenues. Vera Bradley Indirect revenues declined, as expected, due to a non-recurring key account order that took place in last year’s first quarter, but the underlying business remains healthy.”

“We are building a collaborative team with the mindset of generating long-term revenue increases, expanding gross margin, and ensuring strong financial discipline and cost control, which we expect will drive long-term profitable growth,” Ardrey continued. “The team is working hard and taking strategic, proactive steps to steadily grow Pura Vida’s revenues and to reverse the trends in Vera Bradley’s factory channel through the expansion of successfully tested targeted marketing programs designed to drive traffic and average order size.”

Ardrey added, “The hard work on Project Restoration began in the first quarter, which is focused on four key pillars of the business for each brand – Consumer, Brand, Product, and Channel – to drive this long-term profitable growth. To support Project Restoration and lay the foundation for our success, we made additional corporate changes and announced $12 million in incremental annualized cost reductions, including the elimination of approximately 25 corporate positions as part of an overall plan to further right-size the expense structure of the Company.”

Michael Schwindle joined the Company as Chief Financial Officer on May 8, 2023. “His track record of driving profitable growth, along with his passion for retail and operational excellence, will be instrumental as the Company executes Project Restoration and in the years beyond,” Ardrey noted. The Company also made several organizational changes in the Marketing, E-commerce, Product Design, and Product Development areas that flattened and streamlined the organizational structure to improve execution; make faster decisions; and provide support for the four pillars of Project Restoration. These most recent organizational changes and non-payroll expense reductions are expected to produce annualized savings of approximately $12 million, on top of the Company’s Fiscal 2023 cost reductions.

“We are committed to delivering improved value to our shareholders,” Ardrey continued. “These efforts will allow us to simplify our structure, be a more agile organization, and reset our expense base, so we can focus fully on Project Restoration and on delivering both healthy top- and bottom-line growth in the future.”

Summary of Financial Performance for the First Quarter

Consolidated net revenues totaled $94.4 million compared to $98.5 million in the prior year first quarter ended April 30, 2022.

For the current year first quarter, Vera Bradley, Inc.’s consolidated net loss totaled ($4.7) million, or ($0.15) per diluted share. These results included $2.0 million of net after tax charges, comprised of $1.4 million of severance charges, $0.5 million for the amortization of definite-lived intangible assets, and $0.1 million of consulting and professional fees primarily associated with cost saving and strategic initiatives. On a non-GAAP basis, Vera Bradley, Inc.’s consolidated first quarter net loss totaled ($2.6) million, or ($0.09) per diluted share.

For the prior year first quarter, Vera Bradley, Inc.’s consolidated net loss totaled ($7.0) million, or ($0.21) per diluted share. These results included $0.9 million of net after tax charges, comprised of $0.4 million of intangible asset amortization and $0.4 million of impairment charges, and $0.1 million of consulting fees associated with cost savings initiatives. On a non-GAAP basis, Vera Bradley, Inc.’s consolidated first quarter net loss totaled ($6.0) million, or ($0.18) per diluted share.

Non-GAAP Numbers

The current year non-GAAP first quarter income statement numbers referenced below exclude the previously outlined severance charges, intangible asset amortization, and consulting and professional fees. The prior year non-GAAP first quarter income statement numbers referenced below exclude the previously outlined intangible asset amortization, impairment charges, and consulting fees.

First Quarter Details

Current year first quarter Vera Bradley Direct segment revenues totaled $58.9 million, a 4.4% decrease from $61.6 million in the prior year first quarter. Comparable sales declined 3.3% in the first quarter, primarily due to weakness in the factory channel. The Company permanently closed 19 full-line and two factory outlet stores and opened five factory outlet stores over the last twelve months.

Vera Bradley Indirect segment revenues totaled $15.4 million, a 9.4% decrease from $17.0 million in the prior year first quarter. Prior year revenues reflected a large one-time key account order that was not repeated in the current year.

Pura Vida segment revenues totaled $20.1 million, a 1.2% increase over $19.8 million in the prior year first quarter, primarily driven by new store growth resulting in non-comparable retail store sales.

First quarter consolidated gross profit totaled $51.7 million, or 54.8% of net revenues, compared to $52.5 million, or 53.3% of net revenues, in the prior year first quarter. The current year gross profit rate was favorably impacted by lower year-over-year inbound and outbound freight expense and the sell-through of previously-reserved inventory, partially offset by an increase in promotional activity.

Consolidated SG&A expense totaled $58.5 million, or 62.0% of net revenues, for the quarter, compared to $60.9 million, or 61.9% of net revenues, for the prior year first quarter. On a non-GAAP basis, consolidated SG&A expense totaled $55.6 million, or 58.9% of net revenues, for the current quarter, compared to $59.4 million, or 60.3% of net revenues, for the prior year first quarter. Vera Bradley’s current year non-GAAP SG&A expenses were lower than the prior year primarily due to cost reduction initiatives and a reduction in variable-related expenses related to lower sales volume.

The Company’s first quarter consolidated operating loss totaled ($6.4) million, or (6.8%) of net revenues, compared to an operating loss of ($8.2) million, or (8.4%) of net revenues, in the prior year first quarter. On a non-GAAP basis, the consolidated operating loss totaled ($3.5) million, or (3.7%) of net revenues, compared to ($6.7) million, or (6.8%) of net revenues, in the prior year.

By segment:

  • Vera Bradley Direct’s first quarter operating income was $7.3 million, or 12.5% of Direct net revenues, compared to operating income of $5.5 million, or 8.9% of Direct net revenues, in the prior year. On a non-GAAP basis, Vera Bradley Direct’s current year first quarter operating income was $7.7 million, or 13.0% of Direct net revenues, compared to $5.5 million, or 8.9% of Direct net revenues, in the prior year.
  • Vera Bradley Indirect’s first quarter operating income was $4.7 million, or 30.6% of Indirect net revenues, compared to $5.5 million, or 32.3% of Indirect net revenues, in the prior year.
  • Pura Vida’s first quarter operating income was $1.6 million, or 7.8% of Pura Vida net revenues, compared to $1.1 million, or 5.3% of Pura Vida net revenues, in the prior year. On a non-GAAP basis, Pura Vida’s current year first quarter operating income was $2.3 million, or 11.4% of Pura Vida net revenues, compared to $1.8 million, or 9.2% of Pura Vida net revenues, in the prior year.

Balance Sheet

Net capital spending for the first quarter totaled $0.8 million compared to $1.7 million in the prior year.

Cash and cash equivalents as of April 29, 2023 totaled $25.3 million compared to $46.6 million at fiscal year end. The Company had no borrowings on its $75 million ABL credit facility at quarter end.

Total quarter-end inventory was $142.7 million, compared to $161.8 million at the end of the first quarter last year.

During the first quarter, the Company repurchased approximately $0.7 million of its common stock (approximately 0.1 million shares at an average price of $5.71). $27.0 million remains under the Company’s $50.0 million repurchase authorization that expires in December 2024.

Forward Outlook

Management is updating guidance for the fiscal year ending February 3, 2024 (“Fiscal 2024”) based on first quarter performance, Company initiatives underway, and current macroeconomic trends and expectations.

Excluding net revenues, all forward-looking guidance numbers referenced below are non-GAAP. The prior year income statement numbers exclude the previously disclosed charges for goodwill and intangible asset impairment; net inventory and purchase order-related adjustments; severance, retention, and stock-based retirement compensation; consulting and professional fees primarily associated with cost savings initiatives, the CEO search, and strategic initiatives; amortization of definite-lived intangible assets; store and right-of-use asset impairment charges; new CEO sign-on bonus and relocation; and goodMRKT exit costs. Current year guidance excludes any similar charges.

For Fiscal 2024, the Company’s expectations are as follows:

  • Consolidated net revenues of $490 to $510 million. Net revenues totaled $500.0 million in Fiscal 2023. Both Vera Bradley and Pura Vida revenues are expected to be approximately flat on a year-over-year basis.
  • A consolidated gross profit percentage of 52.8% to 53.8% compared to 51.4% in Fiscal 2023. The Fiscal 2024 gross margin rate is expected to be favorably impacted by lower year-over-year freight expense, cost reduction initiatives, and the sell-through of previously-reserved inventory, partially offset by an increase in promotional activity.
  • Consolidated SG&A expense of $237 to $247 million compared to $245.3 million in Fiscal 2023. An expected decline in SG&A expense is being driven by Company-wide cost reduction initiatives, partially offset by restoring short-term and long-term incentive compensation to more normalized levels and incremental marketing investment intended to accelerate customer file growth.
  • Consolidated operating income of $24 to $28 million compared to $12.3 million in Fiscal 2023.
  • Free cash flow of between $35 and $40 million compared to a cash usage of $21.7 million in Fiscal 2023.
  • Consolidated diluted EPS of $0.57 to $0.67 based on diluted weighted-average shares outstanding of 30.7 million and an effective tax rate of approximately 28%. Diluted EPS totaled $0.24 last year.
  • Net capital spending of approximately $5 million compared to $8.2 million in the prior year, reflecting investments associated with new Vera Bradley Factory stores and technology and logistics enhancements.

Disclosure Regarding Non-GAAP Measures

The Company’s management does not, nor does it suggest that investors should, consider the supplemental non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). Further, the non-GAAP measures utilized by the Company may be unique to the Company, as they may be different from non-GAAP measures used by other companies.

The Company believes that the non-GAAP measures presented in this earnings release, including (cash usage) free cash flow; gross profit; selling, general, and administrative expenses; operating loss; net loss; net loss attributable and available to Vera Bradley, Inc.; and diluted net loss per share available to Vera Bradley, Inc. common shareholders, along with the associated percentages of net revenues, are helpful to investors because they allow for a more direct comparison of the Company’s year-over-year performance and are consistent with management’s evaluation of business performance. A reconciliation of the non-GAAP measures to the most directly comparable GAAP measures can be found in the Company’s supplemental schedules included in this earnings release.

Call Information

A conference call to discuss results for the first quarter is scheduled for today, Wednesday, June 7, 2023, at 9:30 a.m. Eastern Time. A broadcast of the call will be available via Vera Bradley’s Investor Relations section of its website, www.verabradley.com. Alternatively, interested parties may dial into the call at (888) 394-8218, and enter the access code 9903988. A replay will be available shortly after the conclusion of the call and remain available through June 21, 2023. To access the recording, listeners should dial (844) 512-2921, and enter the access code 9903988.

About Vera Bradley, Inc.

Vera Bradley, Inc. operates two unique lifestyle brands – Vera Bradley and Pura Vida. Vera Bradley and Pura Vida are complementary businesses, both with devoted, emotionally-connected, and multi-generational female customer bases; alignment as casual, comfortable, affordable, and fun brands; positioning as “gifting” and socially-connected brands; strong, entrepreneurial cultures; a keen focus on community, charity, and social consciousness; multi-channel distribution strategies; and talented leadership teams aligned and committed to the long-term success of their brands.

Vera Bradley, based in Fort Wayne, Indiana, is a leading designer of women’s handbags, luggage and other travel items, fashion and home accessories, and unique gifts.  Founded in 1982 by friends Barbara Bradley Baekgaard and Patricia R. Miller, the brand is known for its innovative designs, iconic patterns, and brilliant colors that inspire and connect women unlike any other brand in the global marketplace.

In July 2019, Vera Bradley, Inc. acquired a 75% interest in Creative Genius, Inc., which also operates under the name Pura Vida Bracelets (“Pura Vida”). Pura Vida, based in La Jolla, California, is a digitally native, highly-engaging lifestyle brand founded in 2010 by friends Paul Goodman and Griffin Thall. Pura Vida has a differentiated and expanding offering of bracelets, jewelry, and other lifestyle accessories. The Company acquired the remaining 25% of Pura Vida in January 2023.

The Company has three reportable segments: Vera Bradley Direct (“VB Direct”), Vera Bradley Indirect (“VB Indirect”), and Pura Vida. The VB Direct business consists of sales of Vera Bradley products through Vera Bradley Full-Line and Factory stores in the United States, www.verabradley.comwww.verabradley.ca, Vera Bradley’s online outlet site, and the Vera Bradley annual outlet sale in Fort Wayne, Indiana. The VB Indirect business consists of sales of Vera Bradley products to approximately 1,700 specialty retail locations throughout the United States, as well as select department stores, national accounts, third party e-commerce sites, and third-party inventory liquidators, and royalties recognized through licensing agreements related to the Vera Bradley brand. The Pura Vida segment consists of sales of Pura Vida products through the Pura Vida websites, www.puravidabracelets.comwww.puravidabracelets.eu, and www.puravidabracelets.ca; through the distribution of its products to wholesale retailers and department stores; and through its Pura Vida retail stores.

Website Information

We routinely post important information for investors on our website www.verabradley.com in the “Investor Relations” section. We intend to use this webpage as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors should monitor the Investor Relations section of our website, in addition to following our press releases, SEC filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our webpage is not incorporated by reference into, and is not a part of, this document.

Investors and other interested parties may also access the Company’s most recent Corporate Responsibility and Sustainability Report outlining its ESG (Environmental, Social, and Governance) initiatives at https://verabradley.com/pages/corporate-responsibility.

Vera Bradley Safe Harbor Statement

Certain statements in this release are “forward-looking statements” made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the Company’s current expectations or beliefs concerning future events and are subject to various risks and uncertainties that may cause actual results to differ materially from those that we expected, including: possible adverse changes in general economic conditions and their impact on consumer confidence and spending; possible inability to predict and respond in a timely manner to changes in consumer demand; possible loss of key management or design associates or inability to attract and retain the talent required for our business; possible inability to maintain and enhance our brands; possible inability to successfully implement the Company’s long-term strategic plans; possible inability to successfully open new stores, close targeted stores, and/or operate current stores as planned; incremental tariffs or adverse changes in the cost of raw materials and labor used to manufacture our products; possible adverse effects resulting from a significant disruption in our distribution facilities; or business disruption caused by pandemics. Risks, uncertainties, and assumptions also include the possibility that Pura Vida acquisition benefits may not materialize as expected and that Pura Vida’s business may not perform as expected. More information on potential factors that could affect the Company’s financial results is included from time to time in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s public reports filed with the SEC, including the Company’s Form 10-K for the fiscal year ended January 28, 2023. We undertake no obligation to publicly update or revise any forward-looking statement. Financial schedules are attached to this release.

CONTACTS:
Investors:
Julia Bentley
jbentley@verabradley.com

Media:        
mediacontact@verabradley.com
877-708-VERA (8372)

Release – Vera Bradley Set To Rejoin Russell 3000® Index

Research News and Market Data on VRA

May 30, 2023

FORT WAYNE, Ind., May 30, 2023 (GLOBE NEWSWIRE) — Vera Bradley, Inc. (Nasdaq: VRA) (the “Company”) today announced the Company is set to rejoin the broad-market Russell 3000® Index and the small-cap Russell 2000® Index at the conclusion of the 2023 Russell indexes annual reconstitution, effective after the U.S. stock market opens on June 26, 2023, according to a preliminary list of additions announced on May 19, 2023.

The annual reconstitution process for the Russell indexes captures the 4,000 largest U.S. stocks as of April 28, 2023, ranking them by total market capitalization. Membership in the U.S. All-Cap Russell 3000® Index, which remains in place for one year, means automatic inclusion in the Large-Cap Russell 1000® Index or Small-Cap Russell 2000® Index, as well as the appropriate growth and value style indexes.

Russell indexes are widely used by investment managers and institutional investors for index funds and as benchmarks for active investment strategies. Approximately $17.9 trillion in assets is currently benchmarked against Russell’s U.S. indexes. Russell indexes are part of FTSE Russell, a leading global index provider.

Jackie Ardrey, Chief Executive Officer of the Company, noted, “We are pleased to rejoin the Russell 3000® Index and believe our inclusion will provide greater visibility, liquidity, and opportunity to reach a broader range of investment managers and institutional investors.”

For more information on the Russell 3000® Index and the Russell indexes reconstitution, go to the “Russell Reconstitution” section on the FTSE Russell website.

About Vera Bradley, Inc.

Vera Bradley, Inc. operates two unique lifestyle brands – Vera Bradley and Pura Vida. Vera Bradley and Pura Vida are complementary businesses, both with devoted, emotionally-connected, and multi-generational female customer bases; alignment as casual, comfortable, affordable, and fun brands; positioning as “gifting” and socially-connected brands; strong, entrepreneurial cultures; a keen focus on community, charity, and social consciousness; multi-channel distribution strategies; and talented leadership teams aligned and committed to the long-term success of their brands.

Vera Bradley, based in Fort Wayne, Indiana, is a leading designer of women’s handbags, luggage and other travel items, fashion and home accessories, and unique gifts.  Founded in 1982 by friends Barbara Bradley Baekgaard and Patricia R. Miller, the brand is known for its innovative designs, iconic patterns, and brilliant colors that inspire and connect women unlike any other brand in the global marketplace.

Pura Vida, based in La Jolla, California, is a digitally native, highly-engaging lifestyle brand founded in 2010 by friends Paul Goodman and Griffin Thall. Pura Vida has a differentiated and expanding offering of bracelets, jewelry, and other lifestyle accessories.

About FTSE Russell

FTSE Russell is a global index leader that provides innovative benchmarking, analytics and data solutions for investors worldwide. FTSE Russell calculates thousands of indexes that measure and benchmark markets and asset classes in more than 70 countries, covering 98% of the investable market globally.

FTSE Russell index expertise and products are used extensively by institutional and retail investors globally. Approximately $17.9 trillion is currently benchmarked to FTSE Russell indexes. For over 30 years, leading asset owners, asset managers, ETF providers and investment banks have chosen FTSE Russell indexes to benchmark their investment performance and create ETFs, structured products and index-based derivatives.

A core set of universal principles guides FTSE Russell index design and management: a transparent rules-based methodology is informed by independent committees of leading market participants. FTSE Russell is focused on applying the highest industry standards in index design and governance and embraces the IOSCO Principles. FTSE Russell is also focused on index innovation and customer partnerships as it seeks to enhance the breadth, depth and reach of its offering.

FTSE Russell is wholly owned by London Stock Exchange Group.

For more information, visit www.ftserussell.com.

Vera Bradley Safe Harbor Statement

Certain statements in this release are “forward-looking statements” made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the Company’s current expectations or beliefs concerning future events and are subject to various risks and uncertainties that may cause actual results to differ materially from those that we expected, including: possible adverse changes in general economic conditions and their impact on consumer confidence and spending; possible inability to predict and respond in a timely manner to changes in consumer demand; possible loss of key management or design associates or inability to attract and retain the talent required for our business; possible inability to maintain and enhance our brands; possible inability to successfully implement the Company’s long-term strategic plans; possible inability to successfully open new stores, close targeted stores, and/or operate current stores as planned; incremental tariffs or adverse changes in the cost of raw materials and labor used to manufacture our products; possible adverse effects resulting from a significant disruption in our distribution facilities; or business disruption caused by pandemics. Risks, uncertainties, and assumptions also include the possibility that Pura Vida acquisition benefits may not materialize as expected and that Pura Vida’s business may not perform as expected. More information on potential factors that could affect the Company’s financial results is included from time to time in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s public reports filed with the SEC, including the Company’s Form 10-K for the fiscal year ended January 28, 2023. We undertake no obligation to publicly update or revise any forward-looking statement.

CONTACTS:
Investors:
Julia Bentley
jbentley@verabradley.com

Media:        
mediacontact@verabradley.com
877-708-VERA (8372)

Vera Bradley (VRA) – Additional Corporate Reorganization and Cost Reduction Plans


Thursday, April 27, 2023

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Placing Her Stamp. Vera Bradley CEO Jackie Ardrey announced additional corporate organizational changes as well as targeting $12 million of incremental cost reductions, the majority of which should fall to the bottom line. We view the announcement as Ms. Ardrey putting her stamp on the Company from a management perspective, while right-sizing the expense structure of the Company.

New CFO. Michael Schwindle will join Vera Bradley as CFO on May 8th. Mr. Schwindle has previously worked with CEO Ardrey. Mr. Schwindle is a 30-year retail industry veteran, including 15 years as a CFO in such firms as accessory and jewelry retailer Claire’s, Fleet Farm, Payless ShoeSource, Harry & David, and Musician’s Friend. Mr. Schwindle began his career at Deloitte & Touche LLP.


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Release – Vera Bradley Announces Additional Corporate Reorganization And Cost Reduction Plans To Support Project Restoration

Research News and Market Data on VRA

Apr 25, 2023

– Newly appointed CFO Michael Schwindle brings well-rounded fiscal, operational, and strategic leadership to support Project Restoration –

– Company targeting $12 million in incremental cost reductions in addition to $27 million previously identified –

FORT WAYNE, Ind., April 25, 2023 (GLOBE NEWSWIRE) — Vera Bradley, Inc. (Nasdaq: VRA) (the “Company”) today announced the Company is making additional corporate organizational changes and targeting $12 million in incremental cost reductions for the fiscal year ending February 3, 2024, including the elimination of approximately 25 corporate positions as part of an overall plan to further right-size the expense structure of the enterprise.

Jackie Ardrey, Chief Executive Officer of the Company, noted, “We are committed to returning Vera Bradley and Pura Vida to profitable growth and generating strong cash flow as a Company, which I believe will deliver value to our shareholders over the long term. Earlier this year, we launched Project Restoration, focusing on four key pillars of the business for each brand – Consumer, Brand, Product, and Channel – to drive this long-term profitable growth.”

“The work on Project Restoration started this quarter,” Ardrey continued, “and it is supported by improved financial discipline and cost control. These efforts together will make us a stronger, healthier Company on the top and bottom line.”

“I am pleased to announce that Michael Schwindle will join the Company as Chief Financial Officer on May 8. His track record of driving profitable growth, along with his passion for retail and operational excellence, will be instrumental as the Company executes Project Restoration and in the years beyond,” Ardrey said.

Schwindle is a retail industry veteran with over 30 years of experience, including more than 15 years in Chief Financial Officer roles, delivering strong results through profit improvement and by providing innovative solutions. Since early 2020, he has served as CFO for accessory and jewelry retailer Claire’s. Previously, he held CFO roles at specialty retailers Fleet Farm, Payless ShoeSource, Harry & David, and Musician’s Friend, as well as other key financial roles at Home Depot and Limited Brands. Schwindle began his career at Deloitte & Touche LLP.

John Enwright, the Company’s Chief Financial Officer, will be stepping down as a result of the reorganization. Enwright will work closely with Schwindle through early June to ensure a smooth transition. Ardrey noted, “On behalf of the Board and our entire team, I want to thank John for his many contributions during his nine years of service and for his commitment to our Company, brands, culture, and Associates. We wish him all the best in the future.”

The Company is making several organizational changes in the Marketing, Ecommerce, Product Design, and Product Development areas that will eliminate approximately 25 corporate positions. The Company will also reduce other non-payroll costs throughout the organization, including but not limited to: non-working marketing expenses, third-party contracts and professional services, logistics, operational costs, and travel.

Ardrey noted, “This flattened and streamlined organizational structure will help us improve execution; make faster decisions; and provide support for the Consumer, Brand, Product, and Channel pillars of Project Restoration. These most recent organizational changes and non-payroll expense reductions are expected to produce annualized savings of approximately $12 million, on top of the $27 million of cost reductions previously identified and largely realized in fiscal 2023. All of these initiatives should position Vera Bradley, Inc. to be a stronger, more nimble organization.”  

“We are committed to delivering improved value to our shareholders,” Ardrey continued. “These efforts will allow us to reset our expense base and simplify the organization, so we can focus fully on Project Restoration and on delivering both healthy top- and bottom-line growth in the future.”

About Vera Bradley, Inc.

Vera Bradley, Inc. operates two unique lifestyle brands – Vera Bradley and Pura Vida. Vera Bradley and Pura Vida are complementary businesses, both with devoted, emotionally-connected, and multi-generational female customer bases; alignment as casual, comfortable, affordable, and fun brands; positioning as “gifting” and socially-connected brands; strong, entrepreneurial cultures; a keen focus on community, charity, and social consciousness; multi-channel distribution strategies; and talented leadership teams aligned and committed to the long-term success of their brands.

Vera Bradley, based in Fort Wayne, Indiana, is a leading designer of women’s handbags, luggage and other travel items, fashion and home accessories, and unique gifts.  Founded in 1982 by friends Barbara Bradley Baekgaard and Patricia R. Miller, the brand is known for its innovative designs, iconic patterns, and brilliant colors that inspire and connect women unlike any other brand in the global marketplace.  In July 2019, Vera Bradley, Inc. acquired a 75% interest in Creative Genius, Inc., which also operates under the name Pura Vida Bracelets (“Pura Vida”). Pura Vida, based in La Jolla, California, is a digitally native, highly-engaging lifestyle brand founded in 2010 by friends Paul Goodman and Griffin Thall. Pura Vida has a differentiated and expanding offering of bracelets, jewelry, and other lifestyle accessories.

Vera Bradley Safe Harbor Statement

Certain statements in this release are “forward-looking statements” made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the Company’s current expectations or beliefs concerning future events and are subject to various risks and uncertainties that may cause actual results to differ materially from those that we expected, including: possible adverse changes in general economic conditions and their impact on consumer confidence and spending; possible inability to predict and respond in a timely manner to changes in consumer demand; possible loss of key management or design associates or inability to attract and retain the talent required for our business; possible inability to maintain and enhance our brands; possible inability to successfully implement the Company’s long-term strategic plans; possible inability to successfully open new stores, close targeted stores, and/or operate current stores as planned; incremental tariffs or adverse changes in the cost of raw materials and labor used to manufacture our products; possible adverse effects resulting from a significant disruption in our distribution facilities; or business disruption caused by pandemics. Risks, uncertainties, and assumptions also include the possibility that Pura Vida acquisition benefits may not materialize as expected and that Pura Vida’s business may not perform as expected. More information on potential factors that could affect the Company’s financial results is included from time to time in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s public reports filed with the SEC, including the Company’s Form 10-K for the fiscal year ended January 28, 2023. We undertake no obligation to publicly update or revise any forward-looking statement.

CONTACTS:
Investors:
Julia Bentley, VP of Investor Relations and Communications
jbentley@verabradley.com
(260) 207-5116

Media:           
mediacontact@verabradley.com
877-708-VERA (8372)

Vera Bradley (VRA) – Showing Progress; Reports 4QFY2023 Results


Thursday, March 09, 2023

Joe Gomes, Managing Director – Generalist Analyst, Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

4QFY23 Results. Net revenue of $147.1 million came in above guidance of $136-$141 million, and our $138 million estimate. Expanded promotional activity negatively impacted adjusted gross margin, which declined 240bp y-o-y. GAAP EPS loss was $0.91, while adjusted EPS was $0.16, compared to EPS of $0.15 and $0.17, respectively, in 4QFY22, and our $0.15 estimate.

Improving Sales Trends. In the fourth quarter, sales trends at both Vera Bradley and Pura Vida improved over prior quarters, with Vera Bradley total sales down just 1% and Pura Vida sales down less than 5% on a year-over-year basis. Targeted customer retention efforts led to increased Vera Bradley e-commerce revenues, while Full-Line and Factory store revenues continued to be negatively affected by traffic levels. At Pura Vida, e-commerce trends improved over previous quarters due to strategic promotions.


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Release – Vera Bradley Announces Fourth Quarter And Fiscal Year 2023 Results

Research News and Market Data on VRA

Mar 8, 2023

Net revenues totaled $500.0 million for the fiscal year

Net loss totaled ($59.7) million, or ($1.90) per diluted share, for fiscal year;
excluding certain items, non-GAAP net income totaled $7.6 million, or $0.24 per diluted share

Balance sheet remains strong, with cash and cash equivalents of $46.6 million and no debt

Management provides guidance for fiscal year ending February 3, 2024

FORT WAYNE, Ind., March 08, 2023 (GLOBE NEWSWIRE) — Vera Bradley, Inc. (Nasdaq: VRA) (or the “Company”) today announced its financial results for the fourth quarter and fiscal year ended January 28, 2023 (“Fiscal 2023”).

In this release, Vera Bradley, Inc. or “the Company” refers to the entire enterprise and includes both the Vera Bradley and Pura Vida brands. “Vera Bradley” on a stand-alone basis refers only to the Vera Bradley brand.

Fourth Quarter and Fiscal Year Comments

Jackie Ardrey, Chief Executive Officer of the Company, noted, “We focused on driving revenues in the fourth quarter through targeted, strategic promotions on seasonal, giftable, and key items. As a result, total Company fourth quarter revenues outperformed our guidance, although gross margins remained under pressure. Diligent expense control enabled us to deliver fourth quarter non-GAAP diluted EPS of $0.16, which was nearly flat with last year.

“In the fourth quarter, sales trends at both Vera Bradley and Pura Vida improved over prior quarters, with Vera Bradley total sales down just 1% and Pura Vida sales down less than 5% on a year-over-year basis. For the fourth consecutive quarter, the Vera Bradley Indirect Channel experienced year-over-year revenue growth. Targeted customer retention efforts led to increased Vera Bradley e-commerce revenues, while Full-Line and Factory store revenues continued to be negatively affected by traffic levels, although trends improved throughout the quarter.”

Ardrey continued, “At Pura Vida, e-commerce trends improved over previous quarters due to strategic promotions; however, overall challenges continued to persist in our social and digital media effectiveness coupled with rising digital media costs. And, we experienced a year-over-year sales decline in our wholesale channel. On the plus side, Pura Vida Full-Line retail stores continued to perform ahead of our expectations, and they drove improved e-commerce traffic and revenues in their markets.

“We also took the opportunity in the fourth quarter to reset and appropriately position the Pura Vida business for the future, by recording goodwill and tradename impairments and necessary inventory write-offs.

“We ended the fiscal year with consolidated revenues of $500 million. During the year, we began to see stabilization in our supply chain, diligently controlled our expenses, and carefully managed our cash. During the fourth quarter, we meaningfully reduced our year-end inventory levels from the third quarter.”

Ardrey added, “Although Fiscal 2023 had its challenges, we took actions and laid the groundwork to position the Company for the future.

“On a corporate basis:

  • In mid-2022, we collaboratively identified $25 million in annualized cost-reduction initiatives and efficiency processes. The expense savings were derived across various areas of the Company, including payroll reductions, retail store efficiencies, marketing expenses, information technology contracts and projects, professional services, and logistics and operational costs. Many of the savings were realized in Fiscal 2023.
  • In January 2023, we further streamlined our corporate structure by eliminating the positions of Vera Bradley Brand President, Chief Creative Officer, and Chief Revenue Officer, and by adding the position of Chief Marketing Officer, designed to drive additional annual cost savings of approximately $2 million, add more focus on marketing and merchandising, and position the Company to deliver steady top- and bottom-line growth. These decisions were made in order to right-size our leadership team and cost structure for the size of our business, to address the continuing challenging macro environment, and to best position us to achieve our long-term strategic plans.
  • Subsequent to the end of Fiscal 2023, in January 2023, we acquired the remaining 25% interest in Pura Vida from founders Griffin Thall and Paul Goodman for $10 million.
  • We continued to make investments in customer data science, business analytics, and pricing optimization, allowing us to collect and analyze data and make fact-based decisions to more efficiently run our business.

“At the Vera Bradley brand:

  • We expanded our robust product innovation pipeline, including launching our Featherweight Collection; continued another year of iconic product collaborations, including with Disney, Harry Potter, and Crocs; and expanded our cozy, sleep, and outerwear collections.
  • We continued to strengthen and rationalize our store base. We opened five new Factory stores and closed 19 underperforming Full-Line stores and one Factory store, ending the fiscal year with 51 Full-Line and 79 Factory locations. We also continued to expand options for customers to shop, like enhancing our presence in third-party marketplaces and adding boutiques in select high-traffic airports.

“At the Pura Vida brand:

  • We entered into several high-profile product collaborations, with brands such as Hello Kitty, Disney, and Harry Potter, and expanded our product offerings by launching our demi-fine collection and expanding our assortment of engravable jewelry, all designed to bring new customers to our brand.
  • We focused on building a more diverse, innovative, effective, and performance-based marketing program to drive Pura Vida e-commerce sales. We began the process of implementing a comprehensive customer data platform to build a single, coherent, complete view of each Pura Vida customer so that we can better target and personalize marketing and become less reliant on third-party marketing. This project is scheduled for completion this spring. We continued to engage our micro influencers, significantly expanded our TikTok presence, launched impactful ads on connected TV, optimized SMS, and aggressively explored other methods to effectively reach our customers.
  • We opened three new Pura Vida Full-Line stores during the year, bringing our Full-Line store count to four, which collectively are exceeding our expectations. These four stores are playing a role in driving new customer acquisition as we continue to diversify our marketing platforms, and they demonstrate the power a retail presence can have in driving digital sales, omni-channel loyalty, and spending.”

Summary of Financial Performance for the Fourth Quarter

Consolidated net revenues totaled $147.1 million for the current year fourth quarter compared to $149.6 million in the prior year fourth quarter.

For the current year fourth quarter, Vera Bradley, Inc.’s consolidated net loss totaled ($28.2) million, or ($0.91) per diluted share. These results included $33.1 million of net after tax charges, comprised of $22.4 million of goodwill and intangible asset impairment charges; $6.7 million of net inventory and purchase order-related adjustments; $2.4 million of severance, retention, and stock-based retirement compensation charges; $0.8 million related to new CEO sign-on bonus and relocation expenses; $0.5 million for the amortization of definite-lived intangible assets; and $0.3 million of consulting and professional fees primarily associated with strategic initiatives. On a non-GAAP basis, Vera Bradley, Inc.’s consolidated fourth quarter net income totaled $5.0 million, or $0.16 per diluted share.

For the prior year fourth quarter, Vera Bradley, Inc. consolidated net income totaled $5.2 million, or $0.15 per diluted share. These results included $0.5 million of net after tax charges primarily related to intangible asset amortization. On a non-GAAP basis, excluding these charges, Vera Bradley, Inc.’s prior year consolidated fourth quarter net income totaled $5.7 million, or $0.17 per diluted share.

Summary of Financial Performance for the Fiscal Year

Consolidated net revenues totaled $500.0 million for Fiscal 2023 compared to $540.5 million for Fiscal 2022.

For the current fiscal year, Vera Bradley, Inc.’s consolidated net loss totaled ($59.7) million, or ($1.90) per diluted share. These results included $67.4 million of net after tax charges, comprised of $40.6 million of goodwill and intangible asset impairment charges; $12.2 million of net inventory and purchase order-related adjustments; $7.4 million of severance, retention, and stock-based retirement compensation charges; $3.3 million of consulting and professional fees primarily associated with cost savings initiatives, the CEO search, and strategic initiatives; $1.8 million for the amortization of definite-lived intangible assets; $1.0 million of store and right-of-use asset impairment charges; $0.8 million related to the new CEO sign-on bonus and relocation expenses; and $0.3 million of goodMRKT exit costs. On a non-GAAP basis, Vera Bradley, Inc.’s consolidated net income totaled $7.6 million, or $0.24 per diluted share.

For the prior fiscal year, Vera Bradley, Inc.’s consolidated net income totaled $17.8 million, or $0.52 per diluted share. These results included $1.8 million of net after tax charges primarily related to intangible asset amortization. On a non-GAAP basis, excluding these charges, Vera Bradley, Inc.’s prior year consolidated net income totaled $19.7 million, or $0.57 per diluted share.

Looking Ahead

Ardrey noted, “We are committed to returning Vera Bradley and Pura Vida to profitable growth and generating strong cash flow as a Company, which I believe will deliver value to our shareholders over the long term. Since joining the Company in November, I am more convinced than ever that both brands have enormous potential, and I am very excited about the future of Vera Bradley, Inc. We have a portfolio of two iconic, lifestyle brands; multi-generational customers with remarkable loyalty and devotion; impressive brand recognition; a solid balance sheet; and an extraordinary culture. We have some heavy lifting to do in fiscal 2024, but I am confident that we will emerge a stronger Company.”

Ardrey continued, “At both brands, we are embarking on Project Restoration and will focus on four key pillars – Consumer, Brand, Product, and Channel – to drive this long-term profitable growth.

“At Vera Bradley:

  • Consumer: We will focus on restoring brand relevancy, targeting casual and feminine 35 to 54 year old women who value both fashion and function.
  • Brand: We will strategically market our distinctive and unique position as a feminine, fashionable brand that connects with consumers on a deep, emotional level.
  • Product: We will refocus on core categories and items we are “best at,” by innovating and expanding within our core products. We will elevate our colorful feminine heritage, keeping it distinctive but more trend relevant through updated print and design. We also will innovate into strategic adjacent lifestyle item introductions that make sense for our customers.
  • Channel: We will accelerate our digital-first focus and online presence, build a balanced footprint that more clearly differentiates Full-Line from Factory stores, and target and/or strengthen relationships with strategically-aligned wholesale partners.

“At Pura Vida:

  • Consumer: We will sharpen our focus on the care-free 18 to 24 collegiate girl, who both those younger and older aspire to be.
  • Brand: We will recenter our brand ethos on “living life to the fullest,” with marketing authentically sharing real moments, places, and faces.
  • Product: We will focus on delivering unique, fun, playful designs that are affordable and accessible with a dominant emphasis on bracelets and jewelry, as well as other strategic, adjacent categories.
  • Channel: We will have a strong focus on restoring e-commerce growth; strategic growth of wholesale by pursuing larger, more strategic partnerships and expanding larger existing accounts; and refining our existing store model.”

“To support growth and development of our two brands, on a corporate basis, we will continue to make strategic investments in the right talent to help drive the transformation and diligently manage our supply chain, gross margin, SG&A expenses, and cash flow,” Ardrey concluded.

Non-GAAP Numbers

The current year non-GAAP fourth quarter income statement numbers referenced below exclude the previously outlined charges for goodwill and intangible asset impairment; net inventory and purchase order-related adjustments; severance, retention, and stock-based retirement compensation; new CEO sign-on bonus and relocation; amortization of definite-lived intangible assets; and consulting and professional fees primarily associated with strategic initiatives. The current year non-GAAP fiscal year income statement numbers also exclude the previously outlined charges for cost savings initiatives and the CEO search, store and right-of-use asset impairment charges, and goodMRKT exit costs. The prior year non-GAAP fourth quarter and fiscal year income statement numbers referenced below exclude the previously outlined intangible asset amortization and store impairment charges.

Fourth Quarter Details

Current year fourth quarter Vera Bradley Direct segment revenues totaled $99.5 million, a 4.6% decrease from $104.4 million in the prior year fourth quarter. Comparable sales decreased 4.5% from the prior year. The Company permanently closed 19 Full-Line stores and one Factory store and opened five Factory stores in the last twelve months.

Vera Bradley Indirect segment revenues totaled $16.7 million, a 28.5% increase over $13.0 million in the prior year fourth quarter. The increase was broad-based with both specialty and key accounts posting year-over-year sales gains.

Pura Vida segment revenues totaled $30.9 million, a 4.2% decrease from $32.2 million in the prior year fourth quarter. The decline was primarily related to lower wholesale sales, partially offset by new store openings.

Fourth quarter consolidated gross profit totaled $60.0 million, or 40.8% of net revenues, compared to $76.1 million, or 50.9% of net revenues, in the prior year fourth quarter. On a non-GAAP basis, current year consolidated gross profit totaled $71.3 million, or 48.5% of net revenues. The current year gross profit rate primarily was negatively affected by higher inbound and outbound freight expense and increased promotional activity, partially offset by price increases.

Consolidated SG&A expense totaled $70.0 million, or 47.6% of net revenues, compared to $67.9 million, or 45.4% of net revenues, in the prior year fourth quarter. On a non-GAAP basis, consolidated SG&A expense totaled $64.4 million, or 43.8% of net revenues, compared to $67.1 million, or 44.8% of net revenues, in the prior year fourth quarter. Vera Bradley’s SG&A current year expenses were lower than the prior year primarily due to cost reduction initiatives and a reduction in variable-related expenses due to the lower sales volume.

The Company’s fourth quarter consolidated operating loss totaled ($49.8) million, or (33.8%) of net revenues, compared to operating income of $8.3 million, or 5.5% of net revenues, in the prior year fourth quarter. On a non-GAAP basis, fourth quarter consolidated operating income totaled $7.0 million, or 4.8% of net revenues, compared to $9.1 million, or 6.1% of net revenues, in the prior year.

By segment:

  • Vera Bradley Direct fourth quarter operating income was $18.5 million, or 18.6% of Direct net revenues, compared to $21.7 million, or 20.7% of Direct net revenues, in the prior year. On a non-GAAP basis, current year Direct fourth quarter operating income was $19.8 million, or 19.9% of Direct net revenues, compared to $21.7 million, or 20.8% of Direct net revenues, in the prior year.
  • Vera Bradley Indirect fourth quarter operating income was $4.6 million, or 27.3% of Indirect net revenues, compared to $2.9 million, or 22.5% of Indirect net revenues, in the prior year. On a non-GAAP basis, current year Indirect fourth quarter operating income was $5.3 million, or 32.0% of Indirect net revenues.
  • Pura Vida’s current year fourth quarter operating loss was ($49.8) million, or (161.2%) of Pura Vida net revenues, compared to operating income of $2.0 million, or 6.2% of Pura Vida net revenues, in the prior year. On a non-GAAP basis, Pura Vida’s current year fourth quarter operating income was $0.4 million, or 1.3% of Pura Vida net revenues, compared to $2.8 million, or 8.6% of Pura Vida net revenues, in the prior year.

Details for the Fiscal Year

Vera Bradley Direct segment revenues for the current fiscal year totaled $328.2 million, 7.5% decrease from $354.9 million in the prior year. Comparable sales declined 9.5% for the fiscal year.

Vera Bradley Indirect segment revenues for the fiscal year totaled $73.3 million, an 11.1% increase over $66.0 million in the prior year, primarily reflecting an increase in certain key account orders.

Current year Pura Vida segment revenues totaled $98.4 million, a 17.7% decrease from $119.6 million in the prior year. Pura Vida’s e-commerce revenues continue to be negatively impacted by the shift in social and digital media effectiveness and rising digital media costs, and a decline in sales to wholesale accounts.

Consolidated gross profit for the current fiscal year totaled $238.9 million, or 47.8% of net revenues, compared to $287.9 million, or 53.3% of net revenues, last year. On a non-GAAP basis, gross profit for the current fiscal year totaled $257.2 million, or 51.4% of net revenues. The current year gross profit rate primarily was negatively affected by higher inbound and outbound freight expense and increased promotional activity, partially offset by price increases.

For the fiscal year, consolidated SG&A expense totaled $265.0 million, or 53.0% of net revenues, compared to $262.0 million, or 48.5% of net revenues, in the prior year. On a non-GAAP basis, SG&A expense totaled $245.3 million, or 49.1% of net revenues, in the current year, compared to $258.8 million, or 47.9% of net revenues, in the prior year. Vera Bradley’s SG&A current year expenses were lower than the prior year primarily due to cost reduction initiatives and a reduction in variable-related expenses due to the lower sales volume.

For the fiscal year, the Company’s consolidated operating loss totaled ($94.9) million, or (19.0%) of net revenues, compared to operating income of $26.9 million, or 5.0% of net revenues, in the prior year. On a non-GAAP basis, the Company’s consolidated operating income was $12.3 million, or 2.5% of net revenues, compared to $30.1 million, or 5.6% of net revenues, in the prior year.

By segment:

  • Vera Bradley Direct operating income was $51.1 million, or 15.6% of Direct net revenues, compared to $73.5 million, or 20.7% of Direct net revenues, in the prior year. On a non-GAAP basis, Direct operating income was $58.3 million, or 17.8% of Direct net revenues, for the current year, compared to $73.6 million, or 20.7% of Direct net revenues, in the prior year.
  • Vera Bradley Indirect operating income was $23.0 million, or 31.3% of Indirect net revenues, compared to $20.3 million, or 30.8% of Indirect net revenues, in the prior year. On a non-GAAP basis, current year Indirect operating income totaled $24.7 million, or 33.7% of Indirect net revenues.
  • Pura Vida’s operating loss was ($78.6) million, or (79.9%) of Pura Vida net revenues, compared to operating income of $9.5 million, or 8.0% of Pura Vida net revenues, in the prior year. On a non-GAAP basis, Pura Vida’s operating income was $4.7 million, or 4.8% of Pura Vida net revenues, compared to $12.6 million, or 10.5% of Pura Vida net revenues, in the prior year.

Balance Sheet

Net capital spending for the fiscal year totaled $8.2 million compared to $5.5 million in the prior year.

Cash and cash equivalents as of January 28, 2023 totaled $46.6 million compared to $88.4 million at the prior fiscal year end. The Company had no borrowings on its $75 million ABL credit facility at fiscal year end.

Total fiscal year-end inventory was $142.3 million, compared to $144.9 million at last fiscal year end. Total current year inventory was lower than the prior year primarily due to inventory adjustments associated with excess and discounted inventory, partially offset by incremental logistics costs burdening overall inventory.

During the fourth quarter, the Company repurchased approximately $0.8 million of its common stock (approximately 187,000 shares at an average price of $4.20), bringing the Company’s Fiscal 2023 purchases to $18.1 million (approximately 2.8 million shares at an average price of $6.40). The Company’s $50.0 million share repurchase authorization expires in December 2024. Since Fiscal 2015, the Company has repurchased $132.9 million, or approximately 12.1 million shares, of its common stock.

Forward Outlook

Management is providing estimates for the fiscal year ending February 3, 2024 (“Fiscal 2024”) based on current macroeconomic trends and expectations. Ardrey noted, “We anticipate the Fiscal 2024 macroeconomic environment to continue to be unpredictable and that this year will be a rebuilding year for both of our brands. We expect to take advantage of gross margin improvement opportunities and manage our expense structure diligently.”

The Company is not providing detailed guidance for the first fiscal quarter of 2024 but expects revenues and diluted loss per share to be approximately in line with the prior year. Ardrey stated, “In the first quarter, we will work to stabilize the business. We hope to see momentum build as the year progresses.”

Excluding net revenues, all forward-looking guidance numbers referenced below are non-GAAP. The prior year income statement numbers exclude the previously disclosed charges for goodwill and intangible asset impairment; net inventory and purchase order-related adjustments; severance, retention, and stock-based retirement compensation; consulting and professional fees primarily associated with cost savings initiatives, the CEO search, and strategic initiatives; amortization of definite-lived intangible assets; store and right-of-use asset impairment charges; new CEO sign-on bonus and relocation; and goodMRKT exit costs. Current year guidance excludes any similar charges.

For Fiscal 2024, the Company’s expectations are as follows:

  • Consolidated net revenues of $490 to $510 million. Net revenues totaled $500.0 million in Fiscal 2023. Both Vera Bradley and Pura Vida revenues are expected to be approximately flat on a year-over-year basis.
  • A consolidated gross profit percentage of 52.6% to 53.6% compared to 51.4% in Fiscal 2023. The expected year-over-year increase is primarily related to reduced inbound freight expense, partially offset by deleveraged overhead costs related to reduced inventory purchases.
  • Consolidated SG&A expense of $241 to $251 million compared to $245.3 million in Fiscal 2023. Year-over-year changes in SG&A expense primarily are being driven by restoring short-term and long-term incentive compensation to normal levels, offset by Company-wide cost reduction initiatives.
  • Consolidated operating income of $17.3 to $21.7 million compared to $12.3 million in Fiscal 2023.
  • Free cash flow of between $25 and $30 million compared to a cash usage of $21.7 million in Fiscal 2023.
  • Consolidated diluted EPS of $0.40 to $0.50 based on diluted weighted-average shares outstanding of 31.0 million and an effective tax rate of approximately 28%. Diluted EPS totaled $0.24 last year.
  • Net capital spending of approximately $5 million compared to $8.2 million in the prior year, reflecting investments associated with new Vera Bradley Factory stores and technology and logistics enhancements.

Disclosure Regarding Non-GAAP Measures

The Company’s management does not, nor does it suggest that investors should, consider the supplemental non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). Further, the non-GAAP measures utilized by the Company may be unique to the Company, as they may be different from non-GAAP measures used by other companies.

The Company believes that the non-GAAP measures presented in this earnings release, including (cash usage) free cash flow; cost of sales; gross profit; selling, general, and administrative expenses; impairment of goodwill and intangible assets; operating (loss) income; net (loss) income; net (loss) income attributable and available to Vera Bradley, Inc.; and diluted net (loss) income per share available to Vera Bradley, Inc. common shareholders, along with the associated percentages of net revenues, are helpful to investors because they allow for a more direct comparison of the Company’s year-over-year performance and are consistent with management’s evaluation of business performance. A reconciliation of the non-GAAP measures to the most directly comparable GAAP measures can be found in the Company’s supplemental schedules included in this earnings release.

Call Information

A conference call to discuss results for the fourth quarter and fiscal year is scheduled for today, Wednesday, March 8, 2023, at 9:30 a.m. Eastern Time. A broadcast of the call will be available via Vera Bradley’s Investor Relations section of its website, www.verabradley.com. Alternatively, interested parties may dial into the call at (888) 204-4368, and enter the access code 3761893. A replay will be available shortly after the conclusion of the call and remain available through March 22, 2023. To access the recording, listeners should dial (844) 512-2921, and enter the access code 3761893.

About Vera Bradley, Inc.

Vera Bradley, Inc. operates two unique lifestyle brands – Vera Bradley and Pura Vida. Vera Bradley and Pura Vida are complementary businesses, both with devoted, emotionally-connected, and multi-generational female customer bases; alignment as casual, comfortable, affordable, and fun brands; positioning as “gifting” and socially-connected brands; strong, entrepreneurial cultures; a keen focus on community, charity, and social consciousness; multi-channel distribution strategies; and talented leadership teams aligned and committed to the long-term success of their brands.

Vera Bradley, based in Fort Wayne, Indiana, is a leading designer of women’s handbags, luggage and other travel items, fashion and home accessories, and unique gifts. Founded in 1982 by friends Barbara Bradley Baekgaard and Patricia R. Miller, the brand is known for its innovative designs, iconic patterns, and brilliant colors that inspire and connect women unlike any other brand in the global marketplace.

In July 2019, Vera Bradley, Inc. acquired a 75% interest in Creative Genius, Inc., which also operates under the name Pura Vida Bracelets (“Pura Vida”). Pura Vida, based in La Jolla, California, is a digitally native, highly-engaging lifestyle brand founded in 2010 by friends Paul Goodman and Griffin Thall. Pura Vida has a differentiated and expanding offering of bracelets, jewelry, and other lifestyle accessories. The Company acquired the remaining 25% of Pura Vida in January 2023, subsequent to the end of Fiscal 2023.

The Company has three reportable segments: Vera Bradley Direct (“VB Direct”), Vera Bradley Indirect (“VB Indirect”), and Pura Vida. The VB Direct business consists of sales of Vera Bradley products through Vera Bradley Full-Line and Factory stores in the United States, www.verabradley.comwww.verabradley.ca, Vera Bradley’s online outlet site, and the Vera Bradley annual outlet sale in Fort Wayne, Indiana. The VB Indirect business consists of sales of Vera Bradley products to approximately 1,700 specialty retail locations throughout the United States, as well as select department stores, national accounts, third party e-commerce sites, and third-party inventory liquidators, and royalties recognized through licensing agreements related to the Vera Bradley brand. The Pura Vida segment consists of sales of Pura Vida products through the Pura Vida websites, www.puravidabracelets.comwww.puravidabracelets.eu, and www.puravidabracelets.ca; through the distribution of its products to wholesale retailers and department stores; and through its Pura Vida retail stores.

Website Information

We routinely post important information for investors on our website www.verabradley.com in the “Investor Relations” section. We intend to use this webpage as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors should monitor the Investor Relations section of our website, in addition to following our press releases, SEC filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our webpage is not incorporated by reference into, and is not a part of, this document.

Investors and other interested parties may also access the Company’s most recent Corporate Responsibility and Sustainability Report outlining its ESG (Environmental, Social, and Governance) initiatives at https://verabradley.com/pages/corporate-responsibility.

Vera Bradley Safe Harbor Statement

Certain statements in this release are “forward-looking statements” made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the Company’s current expectations or beliefs concerning future events and are subject to various risks and uncertainties that may cause actual results to differ materially from those that we expected, including: possible adverse changes in general economic conditions and their impact on consumer confidence and spending; possible inability to predict and respond in a timely manner to changes in consumer demand; possible loss of key management or design associates or inability to attract and retain the talent required for our business; possible inability to maintain and enhance our brands; possible inability to successfully implement the Company’s long-term strategic plans; possible inability to successfully open new stores, close targeted stores, and/or operate current stores as planned; incremental tariffs or adverse changes in the cost of raw materials and labor used to manufacture our products; possible adverse effects resulting from a significant disruption in our distribution facilities; or business disruption caused by pandemics. Risks, uncertainties, and assumptions also include the possibility that Pura Vida acquisition benefits may not materialize as expected and that Pura Vida’s business may not perform as expected. More information on potential factors that could affect the Company’s financial results is included from time to time in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s public reports filed with the SEC, including the Company’s Form 10-K for the fiscal year ended January 29, 2022. We undertake no obligation to publicly update or revise any forward-looking statement. Financial schedules are attached to this release.

CONTACTS:
Investors:
Julia Bentley, VP of Investor Relations and Communications
jbentley@verabradley.com
(260) 207-5116

Media:
mediacontact@verabradley.com
877-708-VERA (8372)

Release – Vera Bradley Announces Reporting Date for Fourth Quarter And Fiscal Year 2023 Results

Research News and Market Data on VRA

Feb 1, 2023

FORT WAYNE, Ind., Feb. 01, 2023 (GLOBE NEWSWIRE) — Vera Bradley, Inc. (Nasdaq: VRA) (“Vera Bradley” or the “Company”) today announced that it plans to report results for the fourth quarter and fiscal year ended January 28, 2023 at 8:00 a.m. Eastern Time on Wednesday, March 8, 2023.

The Company will host a conference call to discuss its financial results at 9:30 a.m. Eastern Time that same day. A live webcast of the conference call will be available on the Investor Relations section of the Company’s website, www.verabradley.com. Alternatively, interested parties may dial into the call at (888) 204-4368 or (323) 994-2093 and enter the access code 3761893. A replay will be available shortly after the conclusion of the call and remain available through March 22, 2023. To access the recording, listeners should dial (844) 512-2921, and enter the access code 3761893.

ABOUT VERA BRADLEY, INC.

Vera Bradley, Inc. operates two unique lifestyle brands – Vera Bradley and Pura Vida. Vera Bradley and Pura Vida are complementary businesses, both with devoted, emotionally connected, and multi-generational female customer bases; alignment as casual, comfortable, affordable, and fun brands; positioning as “gifting” and socially-connected brands; strong, entrepreneurial cultures; a keen focus on community, charity, and social consciousness; multi-channel distribution strategies; and talented leadership teams aligned and committed to the long-term success of their brands.

Vera Bradley, based in Fort Wayne, Indiana, is a leading designer of women’s handbags, luggage and other travel items, fashion and home accessories, and unique gifts. Founded in 1982 by friends Barbara Bradley Baekgaard and Patricia R. Miller, the brand is known for its innovative designs, iconic patterns, and brilliant colors that inspire and connect women unlike any other brand in the global marketplace.

In July 2019, Vera Bradley, Inc. acquired a 75% interest in Creative Genius, Inc., which also operates under the name Pura Vida Bracelets (“Pura Vida”), and acquired the remaining 25% interest in January 2023. Pura Vida, based in La Jolla, California, is a digitally native, highly engaging lifestyle brand founded in 2010 by friends Paul Goodman and Griffin Thall. Pura Vida has a differentiated and expanding offering of bracelets, jewelry, and other lifestyle accessories.  

CONTACTS:
Investors:
Julia Bentley, VP of Investor Relations and Communications
jbentley@verabradley.com
(260) 207-5116

Media:           
877-708-VERA (8372)
Mediacontact@verabradley.com

Vera Bradley (VRA) – Streamlined Leadership


Friday, January 27, 2023

Joe Gomes, Managing Director – Generalist Analyst, Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Streamlined Leadership. We had an opportunity to speak with Vera Bradley management about the recently announced streamlined corporate structure designed to drive cost savings, add more focus on marketing and merchandising, and position the Company to deliver steady top- and bottom-line growth. Ultimately, the new structure should produce annualized savings of over $2 million, on top of the $25 million of cost reductions previously identified.

Specifics. As part of the new structure, the Company eliminated the positions of Vera Bradley Brand President, Chief Creative Officer, and Chief Revenue Officer. The Company will add a position of Senior Vice President of Merchandising and Design for Vera Bradley. In addition, Alison Hiatt has joined the Company as Chief Marketing Officer to oversee digital marketing, customer data, and ecommerce. Ms. Hiatt is an accomplished consumer and marketing leader with a versatile and deep track record of success for several industry-leading brands.


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*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Vera Bradley (VRA) – Results Top Estimates; Environment Remains Challenging


Thursday, December 08, 2022

Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

3QFY23 Results. Net revenues totaled $124 million compared to $134.7 million in the prior year third quarter ended October 30, 2021. Vera Bradley reported consolidated net income of $5.17 million, or EPS of $0.17 per share versus net income of $5.78 million, or EPS of $0.17 per diluted share, last year. Non-GAAP net income was $6.3 million, or $0.20 per diluted share, compared to $6.2 million, or $0.18 per diluted share in 3Q22.

Bifurcation Continues. The fiscal third quarter was a replay of the second fiscal quarter in many ways, in our view. Vera Bradley continued to see a bifurcation of its customer base, with higher household incomes continuing to spend, while inflationary pressures continued to negatively affect the purchases of customers with lower household incomes.


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Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Release – Vera Bradley Announces Third Quarter Fiscal Year 2023 Results

Research, News, and Market Data on VRA

Dec 7, 2022

Consolidated third quarter net revenues totaled $124.0 million

Third quarter net income totaled $5.2 million, or $0.17 per diluted share, vs. $0.17 per diluted share last year; excluding certain items, non-GAAP net income totaled $6.3 million, or $0.20 per diluted share, vs. $0.18 per diluted share last year

Balance sheet remains solid, with cash and cash equivalents of $25.2 million and no debt

Jackie Ardrey named President and CEO effective November 1, 2022, replacing retiring President and CEO Rob Wallstrom

FORT WAYNE, Ind., Dec. 07, 2022 (GLOBE NEWSWIRE) — Vera Bradley, Inc. (Nasdaq: VRA) today announced its financial results for the third quarter ended October 29, 2022.

In this release, Vera Bradley, Inc. or “the Company” refers to the entire enterprise and includes both the Vera Bradley and Pura Vida brands. Vera Bradley on a stand-alone basis refers to the Vera Bradley brand.

Third Quarter Comments

Rob Wallstrom, outgoing Chief Executive Officer of the Company, commented, “We are pleased with our year-over-year improvement in third quarter non-GAAP EPS, largely driven by implementation of our targeted expense reductions. Total Company third quarter revenues of $124.0 million were modestly above overall expectations, and we began to experience some stabilization in our gross margin rate as supply chain challenges moderated and strategic price increases helped offset increased raw material and freight costs.

“As in past quarters, we are continuing to experience bifurcation in the spending of our customer base. Vera Bradley’s Direct Full-Price Channel customers with higher household incomes remained more engaged and continued to spend more than customers with lower household incomes, especially in our Vera Bradley Factory Channel, where inflationary pressures impacted traffic and discretionary spending. However, our Vera Bradley Indirect Channel experienced its third consecutive quarter of year-over-year growth.”

“We opened two additional Pura Vida Full-Price retail stores in the quarter, and they are performing ahead of our expectations,” Wallstrom continued. “As with many direct-to-consumer companies, we have seen a shift from a pure-digital-play model to an integrated multi-channel platform. Our four Full-Price retail stores are not only profitable but have driven improved ecommerce traffic and revenue in their trade areas. However, overall Pura Vida revenues continued to be negatively impacted by the shift in social and digital media effectiveness and rising digital media costs, and we experienced a decline in sales to wholesale accounts.”

Jackie Ardrey Named President and CEO

Jackie Ardrey joined the Company as President and CEO effective November 1, 2022, replacing retiring President and CEO Wallstrom. Wallstrom will continue to work closely with Ardrey through the end of December 2022 to ensure a smooth transition. Ardrey also replaced Wallstrom on the Company’s Board of Directors.

Ardrey is an accomplished, results-oriented leader with over 25 years of experience in multi-channel retail enterprises. Between 2018 and October 2022, she held the post of President at home furnishings and seasonal décor catalog and online retailer Grandin Road, part of the Qurate Retail Group. Previously, Ardrey was CEO of Trading Company Holdings and Senior Vice President of Merchandising and Supply Chain for iconic omnichannel gourmet food and gifting brand Harry and David. Prior to that, she spent 14 years at multi-channel high-end children’s retailer Hanna Andersson in various roles of increasing responsibility, including Senior Vice President of Merchandising, Design, and Wholesale.

“Although I have just been with the Company a few short weeks, I am convinced that both our Vera Bradley and Pura Vida brands have untapped potential in the marketplace,” Ardrey commented. “While I expect the macro environment to remain unpredictable, our teams are focused, and our cash position and balance sheet remain solid. I look forward to working closely with our leadership teams to develop and execute solid growth plans; leverage our many opportunities, especially in merchandising and marketing; and deliver consistent, sustainable growth and value to our stakeholders over the long term.”

Summary of Financial Performance for the Third Quarter

Consolidated net revenues totaled $124.0 million compared to $134.7 million in the prior year third quarter ended October 30, 2021.

For the current year third quarter, Vera Bradley, Inc.’s consolidated net income totaled $5.2 million, or $0.17 per diluted share. These results included $1.1 million of net after tax charges, comprised of $0.6 million of consulting and professional fees primarily associated with cost savings initiatives and the CEO search, $0.4 million for the amortization of definite-lived intangible assets, and $0.3 million of severance and stock-based retirement compensation charges, partially offset by a benefit of $0.2 million for the reversal of certain purchase order cancellation fees. On a non-GAAP basis, Vera Bradley, Inc.’s consolidated third quarter net income totaled $6.3 million, or $0.20 per diluted share.

For the prior year third quarter, Vera Bradley, Inc.’s consolidated net income totaled $5.8 million, or $0.17 per diluted share. These results included $0.4 million of net after tax charges related to intangible asset amortization. On a non-GAAP basis, Vera Bradley, Inc.’s consolidated third quarter net income totaled $6.2 million, or $0.18 per diluted share.

Summary of Financial Performance for the Nine Months

Consolidated net revenues totaled $352.9 million for the current year nine months ended October 29, 2022, compared to $390.9 million in the prior year nine month period ended October 30, 2021.

For the current year nine months, Vera Bradley, Inc.’s consolidated net loss totaled ($31.6) million, or ($1.00) per diluted share. These results included $34.2 million of net after tax charges, comprised of $18.2 million of Pura Vida goodwill and intangible asset impairment charges, $5.0 million of severance and stock-based retirement compensation retirement charges and other employee costs, $4.7 million of inventory adjustments associated with the exit of certain technology products and the write-off of excess mask inventory, $3.0 million of consulting and professional fees primarily associated with cost savings initiatives and the CEO search, $1.3 million of intangible asset amortization, $1.0 million of store and right-of-use asset impairment charges, $0.7 million of purchase order cancellation fees for spring 2023 goods, and $0.3 million of goodMRKT exit costs. On a non-GAAP basis, Vera Bradley, Inc.’s consolidated net income for the nine months totaled $2.6 million, or $0.08 per diluted share.

For the prior year nine months, Vera Bradley, Inc’s consolidated net income totaled $12.7 million, or $0.37 per diluted share. These results included $1.3 million of net after tax charges related to intangible asset amortization. On a non-GAAP basis, Vera Bradley, Inc.’s consolidated net income totaled $14.0 million, or $0.41 per diluted share, for the nine months.

Non-GAAP Numbers

The current year non-GAAP third quarter income statement numbers referenced below exclude the previously outlined consulting and professional fees primarily associated with cost savings initiatives and the CEO search, amortization of definite-lived intangible assets, severance and stock-based retirement compensation charges, and a benefit for the reversal of certain purchase order cancellation fees. The current year non-GAAP income statement numbers for the nine months referenced below exclude the previously outlined goodwill and intangible asset impairment charges, severance and stock-based retirement compensation retirement charges and other employee costs, inventory adjustments, consulting and professional fees, intangible asset amortization, store and right-of-use asset impairment charges, purchase order cancellation fees, and goodMRKT exit costs.

The prior year non-GAAP third quarter and nine-month income statement numbers referenced below exclude the previously outlined intangible asset amortization.

Third Quarter Details

Current year third quarter Vera Bradley Direct segment revenues totaled $80.1 million, a 7.6% decrease from $86.6 million in the prior year third quarter. Comparable sales decreased 9.6% in the third quarter. The Company permanently closed 12 full-line stores and opened 5 factory outlet stores in the last twelve months.

Vera Bradley Indirect segment revenues totaled $22.3 million, a 6.7% increase over $20.9 million in the prior year third quarter, reflecting an increase in certain key account orders, partially offset by a decline in specialty account orders.

Pura Vida segment revenues totaled $21.7 million, a 20.3% decrease from $27.2 million in the prior year.

Third quarter consolidated gross profit totaled $65.9 million, or 53.1% of net revenues, compared to $72.3 million, or 53.6% of net revenues, in the prior year. On a non-GAAP basis, current year gross profit totaled $65.6 million, or 52.9% of net revenues. The current year gross profit rate was negatively affected by higher inbound and outbound freight expense, deleverage of overhead costs, and channel mix changes, partially offset by price increases.

Third quarter consolidated SG&A expense totaled $60.1 million, or 48.4% of net revenues, compared to $64.5 million, or 47.8% of net revenues, in the prior year. On a non-GAAP basis, consolidated SG&A expense totaled $57.6 million, or 46.4% of net revenues for the current year third quarter, compared to $63.7 million, or 47.3% of net revenues, in the prior year. As expected, Vera Bradley’s SG&A current year expenses were lower than the prior year primarily due to cost reduction initiatives and a reduction in variable-related expenses due to the lower sales volume.

The Company’s third quarter consolidated operating income totaled $6.0 million, or 4.8% of net revenues, compared to $8.0 million, or 5.9% of net revenues, in the prior year third quarter. On a non-GAAP basis, the Company’s current year consolidated operating income totaled $8.2 million, or 6.6% of net revenues, compared to $8.7 million, or 6.5%, of net revenues, in the prior year.

By segment:

  • Vera Bradley Direct operating income was $17.1 million, or 21.3% of Direct net revenues, for the third quarter, compared to $17.8 million, or 20.6% of Direct net revenues, in the prior year. On a non-GAAP basis, current year Direct operating income totaled $16.8 million, or 21.0% of Direct revenues.
  • Vera Bradley Indirect operating income was $9.0 million, or 40.4% of Indirect net revenues, for the third quarter, compared to $7.3 million, or 35.1% of Indirect net revenues, in the prior year. On a non-GAAP basis, current year Indirect operating income totaled $9.0 million, or 40.2% of Indirect net revenues.
  • Pura Vida’s operating loss was ($1.4) million, or (6.2%) of Pura Vida net revenues, in the current year, compared to operating income of $1.8 million, or 6.6% of Pura Vida net revenues, in the prior year. On a non-GAAP basis, Pura Vida’s operating loss was ($0.1) million, or (0.3%) of Pura Vida net revenues, compared to operating income of $2.6 million, or 9.4% of Pura Vida net revenues, in the prior year.

Details for the Nine Months

Vera Bradley Direct segment revenues for the current year nine-month period totaled $228.7 million, an 8.7% decrease from $250.5 million in the prior year. Comparable sales declined 11.6% for the nine months.

Vera Bradley Indirect segment revenues for the nine months totaled $56.6 million, a 6.8% increase over $53.0 million in the prior year, reflecting an increase in certain key account orders, partially offset by a decline in specialty account orders.

Pura Vida segment revenues for the nine months totaled $67.5 million, a 22.7% decrease from $87.4 million in the prior year.

Consolidated gross profit for the nine months totaled $178.9 million, or 50.7% of net revenues, compared to $211.8 million, or 54.2% of net revenues, in the prior year. On a non-GAAP basis, current year gross profit totaled $185.9 million, or 52.7% of net revenues. The current year gross profit rate was negatively affected by higher inbound and outbound freight expense, deleverage of overhead costs, and channel mix changes, partially offset by price increases.

For the nine months, consolidated SG&A expense totaled $195.0 million, or 55.3% of net revenues, compared to $194.1 million, or 49.7% of net revenues, in the prior year. On a non-GAAP basis, current year consolidated SG&A expense totaled $181.0 million, or 51.3% of net revenues, compared to $191.8 million, or 49.1% of net revenues, in the prior year. As expected, Vera Bradley’s non-GAAP SG&A current year expenses were lower than the prior year primarily due to cost reduction initiatives and a reduction in variable-related expenses due to the lower sales volume.

For the nine months, the Company’s consolidated operating loss totaled ($45.1) million, or (12.8%) of net revenues, compared to consolidated operating income of $18.6 million, or 4.8% of net revenues, in the prior year nine-month period. On a non-GAAP basis, the Company’s current year consolidated operating income was $5.3 million, or 1.5% or net revenues, compared to $20.9 million, or 5.4% of net revenues, in the prior year.

By segment:

  • Vera Bradley Direct operating income was $32.6 million, or 14.3% of net revenues, compared to $51.9 million, or 20.7% of Direct net revenues, in the prior year. On a non-GAAP basis, current year Direct operating income was $38.6 million, or 16.9% of Direct net revenues.
  • Vera Bradley Indirect operating income was $18.4 million, or 32.5% of Indirect net revenues, compared to $17.4 million, or 32.8% of Indirect net revenues, in the prior year. On a non-GAAP basis, current year Indirect operating income totaled $19.4 million, or 34.2% of Indirect net revenues.
  • Pura Vida’s operating loss was ($28.8) million, or (42.7%) of Pura Vida net revenues, for the current year, compared to operating income of $7.5 million, or 8.6% of Pura Vida net revenues, in the prior year. On a non-GAAP basis, Pura Vida’s operating income was $4.3 million, or 6.4% of Pura Vida net revenues, for the current year, compared to $9.8 million, or 11.3% of Pura Vida net revenues, for the prior year.

Balance Sheet

Net capital spending for the third quarter and nine months totaled $2.6 million and $7.0 million, respectively.

Cash, cash equivalents, and investments as of October 29, 2022 totaled $25.2 million compared to $75.3 million at the end of last year’s third quarter. The Company had no borrowings on its $75 million ABL credit facility at quarter end.

Total quarter-end inventory was $178.3 million, compared to $148.3 million at the end of the third quarter last year. Total current year inventory was higher than the prior year primarily due to approximately $17 million in incremental logistics costs burdening overall inventory as well as incremental Vera Bradley Factory inventory related to lower than expected revenues.

During the third quarter, the Company repurchased approximately $0.8 million of its common stock (approximately 0.2 million shares at an average price of $3.56), bringing year-to-date purchases through the end of the third quarter to approximately $17.3 million (approximately 2.6 million shares at an average price of $6.56). The Company has $28.5 million of remaining availability under its $50.0 million repurchase authorization that expires in December 2024.

Forward Outlook

Ardrey noted, “We expect the fourth quarter macroeconomic environment to continue to be unpredictable; the Pura Vida business will continue to be challenging; inflationary pressures will continue to impact Vera Bradley customers with lower household incomes, particularly in the Factory Channel; and there will be continued pressure on gross margin.”

Excluding net revenues, all forward-looking guidance numbers referenced below are non-GAAP. The prior year SG&A and earnings per diluted share numbers exclude the previously disclosed net charges related to intangible asset amortization. Current year guidance excludes previously disclosed goodwill and intangible asset impairment charges, severance and stock-based retirement compensation retirement charges and other employee costs, inventory adjustments, consulting and professional fees, intangible asset amortization, store and right-of-use asset impairment charges, purchase order cancellation fees, and goodMRKT exit costs.

For the fourth quarter of Fiscal 2023, the Company’s expectations are as follows:

  • Consolidated net revenues of $136 to $141 million. Net revenues totaled $149.6 million in the prior year fourth quarter.
  • A consolidated gross profit percentage of 49.5% to 50.5% compared to 50.9% in the prior year fourth quarter. The expected decrease is primarily associated with incremental targeted promotional activity and deleverage on overhead costs, partially offset by price increases and lower year-over-year freight expense. 
  • Consolidated SG&A expense of $61 to $63 million compared to $67.1 million in the prior year fourth quarter. The reduction in SG&A expense is being driven by cost reduction initiatives and a reduction in compensation expense, marketing, and other variable-related expenses due to the expected sales decline from the prior year.
  • Consolidated diluted EPS of $0.16 to $0.20 based on diluted weighted-average shares outstanding of 31.1 million and an effective tax rate of approximately 25%. Diluted EPS totaled $0.17 in last year’s fourth quarter.

For Fiscal 2023, the Company’s updated expectations are as follows:

  • Consolidated net revenues of $489 to $494 million. Net revenues totaled $540.5 million in Fiscal 2022. Year-over-year Vera Bradley revenues are expected to decline between 6% and 7%, and Pura Vida revenues are expected to decline between 20% and 21%.
  • A consolidated gross profit percentage of 51.9% to 52.1% compared to 53.3% in Fiscal 2022. The expected year-over-year decrease is primarily related to incremental inbound and outbound freight expense, incremental targeted promotional activity, and deleverage on overhead costs, partially offset by price increases.
  • Consolidated SG&A expense of $242 to $244 million compared to $258.8 million in Fiscal 2022. The reduction in SG&A expense is being driven by cost reduction initiatives and a reduction in compensation expense, marketing, and other variable-related expenses due to the expected sales decline from the prior year.
  • Consolidated operating income of $11.6 to $13.5 million compared to $30.1 million in Fiscal 2022.
  • Consolidated diluted EPS of $0.22 to $0.26 based on diluted weighted-average shares outstanding of 31.6 million and an effective tax rate of between 24.0 and 25.0%. Diluted EPS totaled $0.57 last year.
  • Net capital spending of approximately $10 million compared to $5.5 million in the prior year, reflecting investments associated with new Vera Bradley factory and Pura Vida store locations and technology and logistics enhancements.

Disclosure Regarding Non-GAAP Measures

The Company’s management does not, nor does it suggest that investors should, consider the supplemental non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). Further, the non-GAAP measures utilized by the Company may be unique to the Company, as they may be different from non-GAAP measures used by other companies.

The Company believes that the non-GAAP measures presented in this earnings release, including cost of sales; gross profit; selling, general, and administrative expenses; impairment of goodwill and intangible assets; operating income (loss); net income (loss); net (loss) income attributable and available to Vera Bradley, Inc.; and diluted net income (loss) per share available to Vera Bradley, Inc. common shareholders, along with the associated percentages of net revenues, are helpful to investors because they allow for a more direct comparison of the Company’s year-over-year performance and are consistent with management’s evaluation of business performance. A reconciliation of the non-GAAP measures to the most directly comparable GAAP measures can be found in the Company’s supplemental schedules included in this earnings release.

Call Information

A conference call to discuss results for the third quarter is scheduled for today, Wednesday, December 7, 2022, at 9:30 a.m. Eastern Time. A broadcast of the call will be available via Vera Bradley’s Investor Relations section of its website, www.verabradley.com. Alternatively, interested parties may dial into the call at (800) 437-2398, and enter the access code 6836290. A replay will be available shortly after the conclusion of the call and remain available through December 21, 2022. To access the recording, listeners should dial (844) 512-2921, and enter the access code 6836290.

About Vera Bradley, Inc.

Vera Bradley, Inc. operates two unique lifestyle brands – Vera Bradley and Pura Vida. Vera Bradley and Pura Vida are complementary businesses, both with devoted, emotionally-connected, and multi-generational female customer bases; alignment as casual, comfortable, affordable, and fun brands; positioning as “gifting” and socially-connected brands; strong, entrepreneurial cultures; a keen focus on community, charity, and social consciousness; multi-channel distribution strategies; and talented leadership teams aligned and committed to the long-term success of their brands.

Vera Bradley, based in Fort Wayne, Indiana, is a leading designer of women’s handbags, luggage and other travel items, fashion and home accessories, and unique gifts.  Founded in 1982 by friends Barbara Bradley Baekgaard and Patricia R. Miller, the brand is known for its innovative designs, iconic patterns, and brilliant colors that inspire and connect women unlike any other brand in the global marketplace.

In July 2019, Vera Bradley, Inc. acquired a 75% interest in Creative Genius, Inc., which also operates under the name Pura Vida Bracelets (“Pura Vida”). Pura Vida, based in La Jolla, California, is a digitally native, highly-engaging lifestyle brand founded in 2010 by friends Paul Goodman and Griffin Thall. Pura Vida has a differentiated and expanding offering of bracelets, jewelry, and other lifestyle accessories.

The Company has three reportable segments: Vera Bradley Direct (“VB Direct”), Vera Bradley Indirect (“VB Indirect”), and Pura Vida. The VB Direct business consists of sales of Vera Bradley products through Vera Bradley full-line and factory outlet stores in the United States, verabradley.com, verabradley.ca, Vera Bradley’s online outlet site, and the Vera Bradley annual outlet sale in Fort Wayne, Indiana. The VB Indirect business consists of sales of Vera Bradley products to approximately 1,700 specialty retail locations throughout the United States, as well as select department stores, national accounts, third party e-commerce sites, and third-party inventory liquidators, and royalties recognized through licensing agreements related to the Vera Bradley brand. The Pura Vida segment consists of sales of Pura Vida products through the Pura Vida websites, www.puravidabracelets.comwww.puravidabracelets.eu, and www.puravidabracelets.ca; through the distribution of its products to wholesale retailers and department stores; and through its Pura Vida retail stores.

Website Information

We routinely post important information for investors on our website www.verabradley.com in the “Investor Relations” section. We intend to use this webpage as a means of disclosing material, non-public information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors should monitor the Investor Relations section of our website, in addition to following our press releases, SEC filings, public conference calls, presentations and webcasts. The information contained on, or that may be accessed through, our webpage is not incorporated by reference into, and is not a part of, this document.

Investors and other interested parties may also access the Company’s most recent Corporate Responsibility and Sustainability Report outlining its ESG (Environmental, Social, and Governance) initiatives at https://verabradley.com/pages/corporate-responsibility.

Vera Bradley Safe Harbor Statement

Certain statements in this release are “forward-looking statements” made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the Company’s current expectations or beliefs concerning future events and are subject to various risks and uncertainties that may cause actual results to differ materially from those that we expected, including: possible adverse changes in general economic conditions and their impact on consumer confidence and spending; possible inability to predict and respond in a timely manner to changes in consumer demand; possible loss of key management or design associates or inability to attract and retain the talent required for our business; possible inability to maintain and enhance our brands; possible inability to successfully implement the Company’s long-term strategic plan; possible inability to successfully open new stores, close targeted stores, and/or operate current stores as planned; incremental tariffs or adverse changes in the cost of raw materials and labor used to manufacture our products; possible adverse effects resulting from a significant disruption in our distribution facilities; or business disruption caused by COVID-19 or other pandemics. Risks, uncertainties, and assumptions also include the possibility that Pura Vida acquisition benefits may not materialize as expected and that Pura Vida’s business may not perform as expected. More information on potential factors that could affect the Company’s financial results is included from time to time in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of the Company’s public reports filed with the SEC, including the Company’s Form 10-K for the fiscal year ended January 29, 2022. We undertake no obligation to publicly update or revise any forward-looking statement. Financial schedules are attached to this release.

CONTACTS:
Investors:
Julia Bentley, VP of Investor Relations and Communications
jbentley@verabradley.com
(260) 207-5116

Media:        
mediacontact@verabradley.com
877-708-VERA (8372)

Release – Vera Bradley Announces Reporting Date For Fiscal Year 2023 Third Quarter Results

Research, News, and Market Data on VRA

Nov 2, 2022

FORT WAYNE, Ind., Nov. 02, 2022 (GLOBE NEWSWIRE) — Vera Bradley, Inc. (Nasdaq: VRA) (“Vera Bradley” or the “Company”) today announced that it plans to report results for the third quarter ended October 29, 2022 at 8:00 a.m. Eastern Time on Wednesday, December 7, 2022.

The Company will host a conference call to discuss its financial results at 9:30 a.m. Eastern Time that same day. A live webcast of the conference call will be available on the Investor Relations section of the Company’s website, www.verabradley.com. Alternatively, interested parties may dial into the call at (800) 437-2398 or (323) 289-6576, and enter the access code 6836290. A replay will be available shortly after the conclusion of the call and remain available through December 21, 2022. To access the recording, listeners should dial (844) 512-2921, and enter the access code 6836290.

ABOUT VERA BRADLEY, INC.

Vera Bradley, Inc. operates two unique lifestyle brands – Vera Bradley and Pura Vida. Vera Bradley and Pura Vida are complementary businesses, both with devoted, emotionally connected, and multi-generational female customer bases; alignment as casual, comfortable, affordable, and fun brands; positioning as “gifting” and socially-connected brands; strong, entrepreneurial cultures; a keen focus on community, charity, and social consciousness; multi-channel distribution strategies; and talented leadership teams aligned and committed to the long-term success of their brands.

Vera Bradley, based in Fort Wayne, Indiana, is a leading designer of women’s handbags, luggage and other travel items, fashion and home accessories, and unique gifts. Founded in 1982 by friends Barbara Bradley Baekgaard and Patricia R. Miller, the brand is known for its innovative designs, iconic patterns, and brilliant colors that inspire and connect women unlike any other brand in the global marketplace.

In July 2019, Vera Bradley, Inc. acquired a 75% interest in Creative Genius, Inc., which also operates under the name Pura Vida Bracelets (“Pura Vida”). Pura Vida, based in La Jolla, California, is a digitally native, highly engaging lifestyle brand founded in 2010 by friends Paul Goodman and Griffin Thall. Pura Vida has a differentiated and expanding offering of bracelets, jewelry, and other lifestyle accessories.

CONTACTS:
Investors:
Julia Bentley, VP of Investor Relations and Communications
jbentley@verabradley.com
(260) 207-5116

Media:           
877-708-VERA (8372)                                
Mediacontact@verabradley.com

Release – Vera Bradley To Donate Percentage Of Sales To Breast Cancer Research For National Breast Cancer Awareness Month

Research, News, and Market Data on VRA

Oct 3, 2022

Company To Donate 100% Of Primary Net Proceeds From 1982 Collection NFTs, 100% Of Net Proceeds From Limited-Edition Hope Charity Pouch, And 20% Of Purchase Price From “Rose Toile” And “Happiness Returns Pink” Prints To The Vera Bradley Foundation For Breast Cancer

FORT WAYNE, Ind., Oct. 03, 2022 (GLOBE NEWSWIRE) — Vera Bradley, Inc. (NASDAQ: VRA) today announced that Vera Bradley, its iconic American bag and luggage lifestyle brand, will donate 100% of primary net proceeds from its second NFT drop; 100% of net proceeds from its limited-edition Hope Charity Pouch; and 20% of the purchase price of its new Rose Toile and Happiness Returns Pink patterns, to the Vera Bradley Foundation for Breast Cancer (the “Foundation”) in support of National Breast Cancer Awareness Month.

Vera Bradley’s second NFT drop, the 1982 Collection, is now available for purchase through The World of Vera Bradley, the brand’s new metaverse concept, or via OpenSea. The 1982 Collection is comprised of 1,982 generative backgrounds derived from 40 archived prints to commemorate the year the company was founded. Priced at $19.82 USD*, the 1982 Collection appeals to crypto lovers and breast cancer awareness supporters alike, with 100% of Vera Bradley’s primary net proceeds benefiting the Foundation, focusing its unique utility on advocacy and fundraising.

Designed to honor and give hope to those affected by breast cancer, Vera Bradley’s limited-edition Hope Charity Pouch features the word “HOPE,” surrounded by delicate floral embellishments and boldly emblazoned on a canvas zip-closure pouch. The Hope Charity Pouch, available online at www.verabradley.com and in Vera Bradley Full Line Stores nationwide, is priced at $20, with 100% of net proceeds directed to the Foundation.

Vera Bradley’s newest prints with a purpose, Rose Toile and Happiness Returns Pink, also support the critical, life-saving research taking place at the Vera Bradley Foundation Center for Breast Cancer Research at Indiana University School of Medicine in Indianapolis. For every purchase of a style in Rose Toile and Happiness Returns Pink through October 31, 2022, Vera Bradley will donate 20% of the purchase price (up to a maximum contribution of $100,000) to the Foundation. Styles range in price from $4 – $155 and are available now in Vera Bradley Full Line Stores, participating Vera Bradley retailers nationwide, and online at www.verabradley.com.

“Vera Bradley has championed breast cancer research since 1993 when our co-founders Barbara Bradley Baekgaard and Patricia R. Miller established the Vera Bradley Foundation for Breast Cancer in memory of their dear friend, Mary Sloan,” noted Daren Hull, Vera Bradley Brand President. “With support from Vera Bradley’s customers and communities, the Foundation has since donated more than $38 million to fund research pursuing innovative and improved treatments that enable women and men to thrive, not just survive, after a breast cancer diagnosis. We invite our customers to join us in funding even more progressive research this October by purchasing Vera Bradley’s breast cancer awareness items or donating to the Vera Bradley Foundation for Breast Cancer.”

*Please Note: The exact USD retail price will depend on gas prices at time of purchase.

ABOUT VERA BRADLEY
Vera Bradley, based in Fort Wayne, Indiana, is a leading designer of women’s handbags, luggage and other travel items, fashion and home accessories, and unique gifts. Founded in 1982 by friends Barbara Bradley Baekgaard and Patricia R. Miller, the brand is known for its innovative designs, iconic patterns, and brilliant colors that inspire and connect women unlike any other brand in the global marketplace. Visit www.verabradley.com and follow @verabradley to learn more.

ABOUT VERA BRADLEY FOUNDATION FOR BREAST CANCER
The Vera Bradley Foundation for Breast Cancer raises funds for breast cancer research to find a cure and to improve the lives of the many affected by this disease. The Foundation has contributed $38.6 million to the Vera Bradley Foundation Center for Breast Cancer Research at the Indiana University School of Medicine and has pledged to raise a total of $50 million. The Center is focused on developing and dramatically improving therapies for some of the most difficult-to-treat types of breast cancer. Funds are raised through special events, partner events, and individual donations. For more information, visit www.verabradley.org.

CONTACTS
877-708-VERA (8372)
Mediacontact@verabradley.com

Hunter PR for Vera Bradley
verabradley@hunterpr.com

Photos accompanying this announcement are available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/ef5b555c-eb53-4e47-a57e-5ce7237887cd
https://www.globenewswire.com/NewsRoom/AttachmentNg/77e55081-cd84-4b7e-b96a-47409b8e7cc4

Vera Bradley (VRA) – A New CEO


Wednesday, September 21, 2022

Joe Gomes, Senior Research Analyst, Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Getting a New Officer. Yesterday, Vera Bradley announced the appointment of Jacqueline Ardrey as President and CEO effective November 1, 2022, replacing retiring CEO Robert Wallstrom. Wallstrom will be assisting Ardrey through December 2022 to provide a smooth transition, and Ardrey will be joining the Board of Directors on November 1, 2022 as well.

The Past. Robert Wallstrom had been President and CEO of Vera Bradley since 2013, in which he oversaw the Company’s portfolio expansion in 2019 with the Pura Vida acquisition. Under his leadership, Vera Bradley was named America’s #1 Best Midsize Employer and #11 Best Employer for Diversity by Forbes and Statista.


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This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.