Second Quarter Financial Highlights :

Total revenue decreased 5% to $267.8m or down 6% on a constant currency basis 2 .
DTC revenue decreased 5% to $103.9m, or 6% on a constant currency basis 2 with DTC comparable sales 3 declining 13%, partially offset by sales from newer stores.
Wholesale revenue decreased 15% to $137.3m or 17% on a constant currency basis 2 due to a planned lower order book as we continue to elevate our presence within the wholesale channel by right-sizing our inventory position and building strong relationships with brand-aligned partners.
Other revenue increased $16.9m to $26.6m primarily due to clearing slow-moving and discontinued inventory as part of our inventory exit strategy, and contribution of incremental revenue from our knitwear facility we acquired in third quarter fiscal 2024.
Gross profit decreased 9% to $164.1m. Gross margin for the quarter was 61.3% compared to 63.9% in the second quarter of fiscal 2024 primarily due to a higher proportion of non-Heavyweight down revenue within the product mix.

Selling, general and administrative (SG&A) expenses were $162.5m, compared to $177.2m in the prior year period. The reduction in SG&A was primarily due to the non-recurrence of costs relating to the Transformation Program, a shift in timing of marketing spend to align with the launch of the first capsule from Haider Ackermann, and continued efficiencies from workforce reductions in the prior year. This was partially offset by an increase in expenses related to the expansion of our global retail network.
Operating Income was $1.6m, compared to $2.3m in the prior year period.
Adjusted EBIT 4 was $2.5m, compared to $15.6m in the prior year period. The decrease in adjusted EBIT is due to the decline in gross profit in the quarter compared to the same period in fiscal 2024 and the expansion of our global retail network, partially offset by lower corporate SG&A expense and a shift in timing of marketing spend versus the same period last year.
Net income attributable to shareholders was $5.4m, or $0.06 per diluted share, compared with a net income attributable to shareholders of $3.9m, or $0.04 per diluted share in the prior year period.
Adjusted net income attributable to shareholders 4 was $5.2m, or $0.05 per diluted share, compared with an adjusted net income attributed to shareholders of $16.2m, or $0.16 per diluted share in the prior year period.

Balance Sheet Highlights
Inventory of $473.4m for the second quarter ended September 29, 2024, was down 9% year-over-year, due to a combination of sales through our DTC, Wholesale, and Other channels, and a temporary reduction in production levels.
The company ended the second quarter of fiscal 2025 with net debt 4 of $826.4m, compared with $851.9m at the end of the second quarter of fiscal 2024. This net debt position includes borrowings on our revolving facility which is seasonally typical for us as we build inventory in preparation for our peak selling season.

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