The storefront of a Roots location in Toronto is pictured on Sept 14, 2017.Chris Young/The Canadian Press
Roots Corp. shares jumped to their highest levels since they were listed publicly last year on Wednesday, after the Canadian clothing company’s sales and adjusted earnings topped analyst estimates in its latest quarter.
The shares closed at $12.60, up $1.13 or nearly 10 per cent from the previous close. Earlier, they hit an all-time high of $12.78.
The Toronto-based company’s shares have seldom traded above the $12 set for its initial public offering in October.
Roots announced its net income was $20.8 million or 50 cents per share for the fiscal fourth quarter ended Feb. 3, up from $17.2 million or 41 cents per share in the same quarter a last year.
On an adjusted basis, Roots says it earned 59 cents per share in the quarter, up from 48 cents per share a year ago. Analysts on average had expected an adjusted profit of 53 cents per share and revenue of $124.4 million, according to Thomson Reuters.
Sales for the period that includes the busy holiday shopping season totalled $130 million, up from $111.2 million in the same quarter a year earlier. Same-store sales growth was 15.1 per cent.
Jim Gabel, the president and chief executive officer of Roots, said that holiday sales “were outstanding both in-store and online, driving impressive top and bottom-line growth.”
He expressed confidence that Roots will be able to achieve its previously announced outlook for the end of fiscal 2019, following a multi-year transformation project that began in fiscal 2016.
Roots is aiming to achieve between $410 million and $450 million in annual sales for the 2019 financial year that ends in early 2020. Its outlook also estimates between $35 million and $40 million of adjusted net income for fiscal 2019.
As part of the 45-year-old company’s rejuvenation, it listed its shares on the Toronto Stock Exchange in October through an initial public offering.
At the time, the IPO was considered unsuccessful as the initial stock price of $12 per share was below the original proposed range of $14 to $16 each and the stock fell on the first day of trading to close at $10.