RTW Retailwinds, Inc. Comments on Holiday Performance and Fourth Quarter Outlook

RTW Retailwinds, Inc. [NYSE:RTW], an omni-channel specialty apparel retail platform for powerful celebrity and consumer brands, today commented on its holiday (the nine weeks ended January 4, 2020) performance and fourth quarter (the thirteen weeks ending February 1, 2020) fiscal year 2019 outlook ahead of its fireside chat at the 22^nd Annual ICR Conference.

Gregory Scott, RTW Retailwinds CEO, commented: “Growth in our core digital brand, celebrity brands and another double-digit comp increase for our Fashion to Figure business driven by eCommerce were not enough to offset disappointing holiday sales resulting from significant declines in store traffic which led to increased promotional activity. These results emphasize the urgency to adapt to the challenges we face as a business.”

Mr. Scott continued: “In light of our performance and given the current environment, we are taking decisive action and accelerating our strategic transformation agenda. We are addressing these challenges with a sense of urgency, which will include investing in our customer first initiative, rationalizing our real estate portfolio, evaluating all aspects of our go-to-market strategy, and reconfiguring our business to support a profitable and more balanced direct to consumer operating model. We are in the process of finalizing the details of our strategic transformation and will provide further updates during our fourth quarter and fiscal year 2019 earnings release as we position RTW Retailwinds to deliver long-term profitable and sustainable growth. Our strong balance sheet with significant cash and no debt affords us the opportunity to support our transformation.”

Based upon holiday results, the Company now expects comparable store sales for the fourth quarter to be down 8% to 10%, as compared to the same period last year. The operating loss for the fourth quarter is now expected to reflect a loss in the low to mid $20 million range prior to the impact of non-cash impairment charges related to underperforming store assets which will be determined based upon the final closeout of the fiscal year. The Company continues to expect inventory to be down in the mid-single-digit percentage range as we enter the Spring season.