MONTREAL, Oct. 20,
2022 /CNW/ - LXRandCo, Inc. (LXR or the
Company) (TSX: LXR), today announced that it is undertaking
a strategic review process to assess the best course of action for
the Company's next phase of development and growth. The Company has
retained Stifel Nicolaus Canada, Inc. (Stifel GMP) as
exclusive financial advisor to help assess and more fully
explore the strategic alternatives available to it, which may
include the possibility of raising growth capital, a sale or merger
of the Company or an acquisition by the Company.
Since the onset of the COVID-19 pandemic in March 2020, the Company's transformation to a
digital first strategy has been successful. Total revenue in 2021
increased to $18.0 million, an
increase of 31% from $13.8 million in
2020, and our latest twelve months trailing total revenue as at
September 30, 2022 was $21.2 million. Year-to-date e-commerce revenue
now represents 60% of total revenue (as compared to under 10% in
2019), gross margin (see Non-GAAP and Other Financial Measures
Disclosure below) increased to 36% from pre-pandemic levels of
32%, and the Company's annual SG&A expenses have been
materially reduced from over $19.2
million in 2019 to a current level of $9.5 million thus positioning the Company on a
path to future profitability.
As the transformation progressed, the Company considered and
explored several opportunities of a strategic nature, some of which
were unsolicited. In light of this, together with the successful
repositioning of the Company and the growing trend of consolidation
within the resale sector, the Company feels it is appropriate at
this time to more formally assess its alternatives for growth and
to embark on a strategic review. However, there can be no assurance
that the strategic review process will result in any transaction or
other alternative nor any assurance as to its outcome or timing.
The Company has not set a timetable for completion of the review
process and does not intend to periodically or otherwise disclose
developments related to the process unless it determines that such
disclosure is necessary or appropriate.
Given the above, the Company will cease reporting revenue on a
monthly basis and revert to its quarterly reporting cycle. The
Company's financial results for the third quarter 2022 will be
available on November 11, 2022.
In addition, the Company has retained Renmark Financial
Communications Inc. (Renmark Financial) to assist with
investor relations activities.
About LXR
LXRandCo is a socially responsible, digital-first omni-channel
retailer of authenticated pre-owned luxury handbags and personal
accessories. Since 2010, we have been providing consumers with
authenticated branded luxury products by promoting their reuse and
providing an environmentally responsible way for consumers to
purchase luxury products. We achieve this through our digital-first
strategy by selling directly to consumers through our website
at www.lxrco.com and indirectly, by powering the
e-commerce and other platforms of key channel partners. Our
omni-channel model is also supported by retail 'shop-in-shop'
experience centers and by wholesale activities with select retail
partners across North America.
About Renmark Financial
Founded in 1999, Renmark Financial is one of North America's leading retail investor
relations firms. Employing a strategic and comprehensive mix
of exposure tactics, Renmark Financial hosts virtual non-deal
roadshows as well as in-person corporate presentations and
maintains daily communications with thousands of brokers and money
managers across Canada and
the United States. Renmark
Financial empowers its publicly-traded clientele to maximize their
visibility within the financial community and strengthen their
investor audience messaging.
Caution Regarding Forward-Looking Statements
Certain statements in this press release are prospective in
nature and constitute forward-looking information or
forward-looking statements within the meaning of applicable
securities laws (collectively, "forward-looking statements").
Forward-looking statements generally, but not always, can be
identified by the use of forward-looking terminology such as
"outlook", "objective", "may", "could", "would", "will", "expect",
"intend", "estimate", "forecasts", "project", "seek", "anticipate",
"believes", "should", "plans" or "continue", or similar expressions
suggesting future outcomes or events and the negative of any of
these terms. Forward-looking statements in this news release
include, but are not limited to, statements concerning future
objectives and strategies to achieve those objectives, including,
without limitation, the Company's strategic review process and the
types of strategic alternatives to be considered, as well as other
statements with respect to management's beliefs, plans, estimates
and intentions, and similar statements concerning anticipated
future events, results, outlook, circumstances, performance or
expectations that are not historical facts. Forward-looking
statements reflect management's current beliefs, expectations and
assumptions and are based on information currently available to
management, which includes assumptions about continued revenues
based on historical past performance, management's historical
experience, perception of trends and current business conditions,
expected future developments, including the Company's capacity to
secure additional financing, Company's ability to identify timely
and reasonable strategic alternatives and other factors which
management considers appropriate. With respect to the
forward-looking statements included in this press release,
management has made certain assumptions with respect to, among
other things, the Company's ability to meet its future objectives
and strategies, the Company's ability to achieve its future
projects and plans and that such projects and plans will proceed as
anticipated, the expected growth of the Company's e-commerce
revenue, and the Company's ability to identify and undertake
strategic alternatives for its next phase of growth as well as
assumptions concerning general economic and market growth rates,
currency exchange and interest rates and competitive intensity,
notably in the context of the current COVID-19 outbreak.
Readers are cautioned not to place undue reliance on
forward-looking statements, as there can be no assurance that the
future circumstances, outcomes or results anticipated or implied by
such forward-looking statements will occur or that plans,
intentions or expectations upon which the forward-looking
statements are based will occur.
All forward-looking statements included in and incorporated
into this press release are qualified by these cautionary
statements. Unless otherwise indicated, the forward-looking
statements contained herein are made as of the date of this press
release, and except as required by applicable law, the Company does
not undertake any obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
Readers are cautioned that the actual results achieved will
vary from the information provided herein and that such variations
may be material. Consequently, there are no representations by LXR
that actual results achieved will be the same in whole or in part
as those set out in the forward-looking statements.
Non-GAAP and Other Financial Measures Disclosure
This news release includes Gross Margin as a supplemental
indicator of the Company's operating performance. This non-GAAP
financial measure is provided to enhance the user's understanding
of our historical and current financial performance. Readers are
cautioned that Gross Margin should not be construed as an
alternative measure to other measures as determined in accordance
with GAAP, or as an indicator of the Company's financial
performance or a measure of liquidity and cash flows.
"Gross Margin" means total net revenue less the cost of
goods sold. Gross Margin is not an earnings measure recognized by
GAAP and does not have a standardized meaning prescribed by GAAP;
accordingly, Gross Margin may not be comparable to similar measures
presented by other issuers. Management believes Gross Margin is a
useful measure of profitability before considering operating and
other expenses and can be used to assess the Company's ability to
generate positive net earnings and cash flows.
SOURCE LXRandCo, Inc.