Destination XL Group, Inc. Reports Holiday Sales Results
- Total sales were
$102.4 millioncompared to $111.7 millionfor the 9-week holiday sales period ended December 31, 2022.
- Comparable sales for the same 9-week holiday period decreased 8.7%, with comparable sales decreases of 7.6% from stores and 10.9% from the direct business.
Based on the holiday sales results and expectations for the remainder of the fourth quarter, the Company is narrowing its guidance for fiscal 2023 as follows:
- Total sales for fiscal 2023 are expected to be
$520.0 millionto $525.0 million, or the lower half of its previous guidance of $520.0 millionto $530.0 million.
- Net income of
$0.39to $0.43per diluted share, as compared to its previous guidance of $0.39to $0.46per diluted share. Adjusted net income of $0.45to $0.49per diluted share, as compared to its previous guidance of $0.45to $0.52per diluted share. Adjusted net income is a non-GAAP measure.
- Adjusted EBITDA margin of 10.0% to 10.5%, as compared to its previous guidance of 10.0% to 11.0%. Adjusted EBITDA margin is a non-GAAP financial measure.
“Our sales results for the 9-week holiday period were disappointing, but not unexpected. We started the quarter with a high, single-digit negative comp and that is exactly where we ended the holiday period. Lower traffic to both the stores and our website was the primary reason for the decline in sales. Despite the challenges with traffic, we resisted the temptation to stimulate sales by becoming hyper-promotional, which we believe also resulted in softer conversion online. Conversely, staying the course as we continue to rebuild the DXL brand avoided further erosion in gross margin with unnecessary markdowns. This strategy was made possible because of our clean inventory position and our disciplined approach to inventory management,” said
The Company plans to report its actual fourth-quarter and fiscal 2023 financial results on
In addition to financial measures prepared in accordance with
Adjusted net income and adjusted net income per diluted share are calculated by excluding any asset impairment charge (gain) and the loss from the termination of the retirement plans, subtracting the actual income tax provision (benefit) and applying an effective tax rate of 27%. The Company believes that this comparability is useful in comparing the actual results period to period. Adjusted net income per diluted share is then calculated by dividing the adjusted net income by the weighted average shares outstanding for the respective period, on a diluted basis.
Adjusted EBITDA is calculated as earnings before interest, taxes, depreciation and amortization and adjusted for the loss from the termination of the retirement plans and asset impairment charge (gain), if any. Adjusted EBITDA margin is calculated as adjusted EBITDA divided by total sales. The Company believes that providing adjusted EBITDA and adjusted EBITDA margin is useful to investors to evaluate the Company’s performance and are key metrics to measure profitability and economic productivity.
Certain statements and information contained in this press release constitute forward-looking statements under the federal securities laws, including statements regarding our guidance for fiscal 2023, including expected sales, net income and adjusted EBITDA margin, and the expected timing of the release of its financial results for the fourth quarter and fiscal year 2023. The discussion of forward-looking information requires management of the Company to make certain estimates and assumptions regarding the Company's strategic direction and the effect of such plans on the Company's financial results. The Company's actual results and the implementation of its plans and operations may differ materially from forward-looking statements made by the Company. The Company encourages readers of forward-looking information concerning the Company to refer to its filings with the
Forward-looking statements contained in this press release speak only as of the date of this release. Subsequent events or circumstances occurring after such date may render these statements incomplete or out of date. The Company undertakes no obligation and expressly disclaims any duty to update such statements occurring after such date may render these statements incomplete or out of date. The Company undertakes no obligation and expressly disclaims any duty to update such statements.
CERTAIN COLUMNS IN THE FOLLOWING TABLE MAY NOT FOOT DUE TO ROUNDING
|FISCAL 2023 FORECAST
|GAAP TO NON-GAAP ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN RECONCILIATION
|GAAP to NON-GAAP ADJUSTED NET INCOME AND ADJUSTED NET INCOME PER SHARE RECONCILIATION
|(in millions, except per share data and percentages)
|per diluted share
|Net income (GAAP basis)
|Loss from termination of retirement plans
|Provision for income taxes
|9.3 - 10.2
|Interest income, net
|Depreciation and amortization
|Adjusted EBITDA (non-GAAP basis)
|Sales (53-week basis)
|Adjusted EBITDA margin as a percentage of sales (non-GAAP basis)
|Net income (GAAP basis)
|Loss from termination of retirement plans, tax effected
|Adjusted net income (non-GAAP basis)
|Weighted average common shares outstanding - diluted (1)
|(1) No share repurchases have been assumed for the fourth quarter of fiscal 2023
Investor Contact: Investor.firstname.lastname@example.org 603-933-0541
Source: Destination XL Group, Inc.