• Q3 loss amounts to US$607.8m
  • Gross margin narrows to 40.2%
  • Sales grow 6%
J Crew warned it may book further write-downs

J Crew warned it may book further write-downs

US fashion retailer J Crew Group has moved to a net loss in third-quarter thanks to write-downs on the value of its retail store operations and non-cash impairment charges.

Net losses in the three months ended 1 November amounted to US$607.8m compared with earnings of $35.4m in the third quarter last year. The company logged write-downs of $536m in the period related to its stores reporting unit and $145m for its trade name.

Gross margin narrowed to 40.2% from 43.9% in the year ago period.

Revenues, however, increased 6% to $655.2m, while comparable sales dropped 2%. Store sales were up 4% to $437.8m, while direct sales rose 10% to $207.8m.

The privately held New York retailer warned it may book further write-downs in future quarters.