Reitmans Q1 revenue rises 0.8% as shoppers return to stores

Canadian apparel retailer Reitmans reported an improved first quarter, posting higher sales and a narrower loss as investments in its store network and cost-reduction efforts began to deliver results.

The Montreal-based company, and owner of brands such as Penningtons and Rw&Co, said net revenues for the three months ended May 2 increased 0.8% to $160.1 million, while comparable sales, including e-commerce, rose 0.3%.

Revenue from retail stores increased 2.9% during the quarter, despite the company operating seven fewer stores than a year earlier. Growth was driven largely by newer locations and recently renovated stores, which outperformed the broader fleet.

The company unveiled a new flagship concept store at Carrefour Laval, while banner RW&CO completed the renovation of its location at Toronto Eaton Centre shortly after quarter-end. According to the company, the revamped RW&CO store has exceeded expectations since reopening in late May.

“RCL delivered an improved first quarter compared to last year, with solid progress shown across the business despite a challenging economic environment,” said Andrea Limbardi, president and CEO of Reitmans.

“Net revenues from our retail stores increased 2.9% as Canadians continued returning to stores, particularly in shopping malls. Our investments in the store fleet are beginning to pay off, with non‑comparable locations contributing more strongly to revenue growth.” 

Gross profit rose slightly to $89.1 million from $88.5 million a year earlier, while gross margin remained unchanged at 55.7%.

The retailer also made progress on profitability. Adjusted EBITDA improved by $5.2 million to a loss of $5.4 million, while net loss narrowed 37% to $6.3 million, or $0.13 per share, compared with a loss of $10 million, or $0.20 per share, in the same period last year.