As Fort Wayne Vera Bradley Inc. (Nasdaq: VRA) prepares for a leadership change, the fashion retailer is reporting third quarter net income of $5.1 million, compared to $5.7 million during the same period a year ago. Outgoing CEO Rob Wallstrom says Q3 revenues of $124 million were modestly above overall expectations as the company experienced some stabilization in costs.
He says 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,” said Wallstrom.
In July, the company announced Wallstrom was retiring at the end of the year from the luggage, handbag, and accessory design company. In September, Jackie Ardrey, a veteran in multi-channel retail enterprises, was named successor.
Ardrey also replaces Wallstrom on the company’s board of directors.
Most recently Ardrey currently served as president of Grandin Road, a home decor and furnishings company headquartered in Ohio. She is also the former CEO of Victoria Trading Co. in Kansas.
Ardrey, who joined Vera Bradley in November, says the company faces economic headwinds.
“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.”
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