U.S. Auto Parts Network has reported its results for the second quarter ended June 29, 2019.
Net sales were $73.7 million compared to $77 million. Gross profit increased 6% to $21.8 million compared to $20.5 million. As a percentage of net sales, gross profit increased 280 basis points to 29.5% compared to 26.7%.
Net loss was $1.5 million or $(4 cents) per share, compared to net loss of $0.8 million or $(2 cents) per share. Adjusted EBITDA was $1.4 million compared to $2.8 million.
“We began to execute on our new operating plan during the second quarter, which led to sequential improvements in gross profit, gross margin and adjusted EBITDA,” said Lev Peker, CEO of U.S. Auto Parts. “In fact, this was our strongest quarter of gross margin since Q1 2018, reflecting our renewed focus on private label sales. In just over six months at the company, we have rebuilt and strengthened our team with key personnel, further consolidated our websites, and are now in the process of realigning our inventory and cost structure to better match our new directives.
“Last week, our new 125,000-square-foot distribution center (DC) went live in Las Vegas, Nevada, approximately one month ahead of schedule. This is now our third DC, which will enable us to provide two-day delivery or less to 94% of the country while realizing savings in freight costs.
“As we look ahead, we will continue building out our team within merchandising, engineering, planning and operations. We believe we have a good handle on margins and are now turning our focus to operating expenses, where we expect to make significant reductions over the next six months. We also will continue to focus on better utilizing our resources to sell our highest margin products — private label — through our highest margin channels — CarParts.com, JCwhitney.com and AutoPartsWarehouse.com. The journey for the new U.S. Auto Parts is just beginning. There is still much to improve, particularly with inventory optimization and in-stock rates, however we are taking the necessary steps to deliver positive adjusted EBITDA in 2019 and look forward to maximizing value for all shareholders as we execute on our operating plan,” Peker concluded.
