Roots, the Canadian outdoor lifestyle brand, has experienced a 3.7% decline in sales during the first quarter. Sales for the quarter dropped to $41.5 million, down from $43.1 million in the same period last year. The decrease can primarily be attributed to a decline in direct-to-consumer sales, including retail store and e-commerce sales, which fell 5.3% year-over-year. These results reflect ongoing economic challenges and a highly promotional market environment.

Despite the overall decline, there were some positive aspects to report. P&O sales, which include wholesale branded products and licensing agreements, increased by 6.9% to $6.1 million. This increase was driven partly by higher sales from the company’s international operating partner in Taiwan. Additionally, there were increased royalties for licensing agreements with select manufacturing partners and a favorable foreign exchange rate.

Roots reported that it incurred a net loss of $8 million, or $0.19 per share, for the first quarter of 2023, compared to a net loss of $5.3 million, or ($0.13) per share, in the same period last year. Despite these challenges, Meghan Roach, the president and CEO of Roots, remains optimistic about the company’s future. Roach stated, “Our Q1 2023 results aligned with our internal projections and reflect a challenging economic environment. The first quarter traditionally represents less than 15% of our annual sales, and we have made strategic investments in our business that support our revenue-intensive second half.”

Notably, Roots recently appointed Joey Gollish as a creative director in residence, marking the first time the brand has welcomed an outsider in this role. Gollish, the founder of the renowned fashion label Mr. Saturday, was recognized as Canada’s 2022 Menswear Designer of The Year by the Canadian Arts & Fashion Awards.

Despite the sales decline in the first quarter, Roots remains focused on strategic investments and optimistic about its future performance. With the addition of a creative director in residence and a commitment to navigating the challenging economic landscape, the company is well-positioned to seize opportunities and drive growth in the upcoming quarters.

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