Aritzia Inc. announced earnings results for the third quarter and nine months ended November 27, 2016. For the quarter, the company reported net revenue increased by 20.0% to $186.5 million from $155.4 million in the third quarter last year. The increase was primarily driven by comparable sales growth of 15.2%, with strong in-store performance and continued momentum in the Company's eCommerce business, as well as the revenue from five new store openings and five expanded or repositioned stores since the third quarter of last year. Comparable sales increased 15.2%, following 15.4% comparable sales growth in the third quarter last year. Adjusted EBITDA increased by 35.4% to $45.4 million from $33.6 million in the third quarter last year. During the quarter, a modification to the accounting treatment of the Company's legacy option plan resulted in a non-cash reversal of a $28.3 million deferred income tax asset to income tax expense. This primarily led to a net loss of $8.1 million, or $0.08 per share (on a basic and diluted basis) as compared to net income of $15.6 million, or $0.15 per share (on a basic and diluted basis), in the third quarter last year. Adjusted net income increased by 44.7% to $27.5 million, or $0.23 per diluted share, as compared to Adjusted Net Income of $19.0 million, or $0.16 per diluted share, in the third quarter last year.

For the nine months, net revenue increased by 25.5% to $470.8 million from $375.1 million in the prior year. The increase was primarily driven by comparable sales growth of 15.1%, arising from both the strong in-store performance and continued momentum in the Company's eCommerce business, as well as the revenue from non-comparable stores. Adjusted EBITDA increased by 38.3% to $85.4 million, or 18.1% of net revenue, as compared to $61.7 million, or 16.5% of net revenue, in the prior year. Stock-based compensation of $98.6 million was expensed due to both legacy time-based options adjusted to fair market value up to September 30, 2016 and the triggering of legacy performance-based options of $97.3 million in connection with the Company's IPO. Stock-based compensation of $8.6 million was expensed in the prior year due solely to the legacy time-based options. The stock-based compensation expense primarily contributed to a net loss of $67.6 million, compared to net income of $22.4 million in the prior year. Excluding the impact of stock-based compensation and the aforementioned income tax expense resulting from the reversal of the deferred income tax asset, IPO-related costs, unrealized foreign exchange (gains) losses on U.S. dollar forward contracts and $2.9 million in debt refinancing costs related to the IPO, net of related tax effects, adjusted net income increased by 62.5% to $46.3 million, compared to $28.5 million in the prior year.

The company provided sales guidance for the fourth quarter of fiscal 2017. The company had a strong holiday period starting with a successful Black Friday promotion at the end of the third quarter of fiscal 2017. This year represented the company's fourth and strongest Black Friday sales week, both in stores and online. The company's fourth quarter is off to a strong start, with December comparable sales growth up 12.9% for the 5-week period ended January 1, 2017.