Party City Announces Third Quarter 2016 Financial Results And Brand Comparable Sales For Fiscal October 2016

Party City Holdco Inc. (NYSE: PRTY) today announced its financial results for the quarter ended September 30, 2016 and brand comparable sales for fiscal October 2016.

For the quarter ended September 30, 2016 the Company reported total revenues of $557 million, up 0.3% from the prior year period or up 1.7% on a constant currency basis. Income from operations increased 17.3% to $36.9 million and adjusted EBITDA (see "Non-GAAP Information") increased 13.4% to $66.0 million. Reported GAAP diluted earnings per share increased to $0.08 from a loss of $0.37 in the third quarter of fiscal 2015. Adjusted diluted net income per share increased to $0.12 from $0.10 in the third quarter of fiscal 2015 (see "Non-GAAP Information").

For the five-week period ended November 5, 2016 (fiscal October, which comprises the majority of Halloween sales), the Company reported retail sales of $399.4 million, a 7.0% decrease from the same period in 2015. Brand comparable sales, which include Company-owned Party City stores in the US and Canada and North American e-commerce operations, decreased 6.4%.

During the Halloween season, the Company operated 270 temporary Halloween City stores, compared to 335 in 2015, with the reduction in temporary stores a result of the shift from a Saturday Halloween last year to a Monday Halloween this year.

"We are pleased with our third quarter results, which demonstrate the competitive advantages of our unique, vertical model," said James M. Harrison, Chief Executive Officer. "While a portion of the third quarter was impacted by a softer Halloween season, we continued to see strong gains in our everyday categories, which delivered brand comparable sales growth of almost 4%. In addition, in our international markets, in constant currency, we grew total revenue over 12%."

Mr. Harrison added: "With respect to the month of October, the two day Halloween shift from Saturday to Monday this year, as well as the backdrop of a more distracted consumer, resulted in the negative Halloween brand comp, as we saw less overall participation on the adult side of the business. The good news is that our juvenile Halloween business was essentially flat, and our everyday business remained strong in the month, with comp sales growth of around 4%. As we finish the year, while we are well positioned to remain the top of mind choice for the holiday entertaining season, leveraging our full assortment of products and our omni-channel strategy, we are updating our outlook to reflect our year-to-date performance. "

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