SEC Filing | Destination XL Group, Inc.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

View:

Download DOC

Download PDF

Download XLS

Download XBRL

10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 30, 2021


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 01-34219

DESTINATION XL GROUP, INC.

(Exact Name of Registrant as Specified in its Charter)


Delaware	04-2623104
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
555 Turnpike Street Canton, MA	02021
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (781) 828-9300

Securities registered pursuant to Section 12(b) of the Act.


Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	DXLG	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of November 12, 2021, the registrant had 63,254,046 shares of common stock, $0.01 par value per share, outstanding.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

DESTINATION XL GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)


	October 30, 2021			January 30, 2021
	(Fiscal 2021)			(Fiscal 2020)

ASSETS
Current assets:
Cash and cash equivalents	$	6,937		$	18,997
Accounts receivable		1,604			6,416
Inventories		82,284			85,028
Prepaid expenses and other current assets		6,926			3,689
Total current assets		97,751			114,130

Non-current assets:
Property and equipment, net of accumulated depreciation and amortization		45,769			56,552
Operating lease right-of-use assets		118,684			134,321
Intangible assets		1,150			1,150
Other assets		567			602
Total assets	$	263,921		$	306,755

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	29,765		$	27,091
Accrued expenses and other current liabilities		32,753			24,825
Operating leases, current		37,150			43,598
Borrowings under credit facility		—			59,521
Total current liabilities		99,668			155,035

Long-term liabilities:
Long-term debt		—			14,869
Operating leases, non-current		112,252			135,819
Other long-term liabilities		4,268			5,109
Total long-term liabilities		116,520			155,797

Commitments and contingencies

Stockholders' equity (deficit):
Preferred stock, $0.01 par value, 1,000,000 shares authorized, none issued		—			—
Common stock, $0.01 par value, 125,000,000 shares and 100,000,000 authorized at October 30, 2021 and January 30, 2021, respectively, 76,777,738 and 64,656,384 shares issued at October 30, 2021 and January 30, 2021, respectively		768			647
Additional paid-in capital		319,439			314,747
Treasury stock at cost, 12,755,873 shares at October 30, 2021 and January 30, 2021		(92,658	)		(92,658	)
Accumulated deficit		(173,788	)		(220,592	)
Accumulated other comprehensive loss		(6,028	)		(6,221	)
Total stockholders' equity (deficit)		47,733			(4,077	)
Total liabilities and stockholders' equity (deficit)	$	263,921		$	306,755

The accompanying notes are an integral part of the consolidated financial statements.

DESTINATION XL GROUP, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)


	For the Three Months Ended						For the Nine Months Ended
	October 30, 2021			October 31, 2020			October 30, 2021			October 31, 2020
	(Fiscal 2021)			(Fiscal 2020)			(Fiscal 2021)			(Fiscal 2020)

Sales	$	121,486		$	85,171		$	371,570		$	218,840
Cost of goods sold including occupancy costs		60,529			54,099			188,178			153,057
Gross profit		60,957			31,072			183,392			65,783

Expenses:
Selling, general and administrative		41,962			32,820			120,856			90,727
Impairment of assets		(1,086	)		(1,135	)		(2,103	)		15,200
Depreciation and amortization		4,142			5,302			13,031			16,374
Total expenses		45,018			36,987			131,784			122,301

Operating income (loss)		15,939			(5,915	)		51,608			(56,518	)

Interest expense, net		(2,189	)		(1,080	)		(4,256	)		(2,873	)

Income (loss) before provision for income taxes		13,750			(6,995	)		47,352			(59,391	)
Provision for income taxes		94			27			548			71


Net income (loss)	$	13,656		$	(7,022	)	$	46,804		$	(59,462	)


Net income (loss) per share - basic	$	0.21		$	(0.14	)	$	0.74		$	(1.16	)
Net income (loss) per share - diluted	$	0.20		$	(0.14	)	$	0.69		$	(1.16	)

Weighted-average number of common shares outstanding:
Basic		63,699			51,545			63,126			51,127
Diluted		68,644			51,545			67,378			51,127

The accompanying notes are an integral part of the consolidated financial statements.

DESTINATION XL GROUP, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In thousands)

(Unaudited)


	For the Three Months Ended					For the Nine Months Ended
	October 30, 2021		October 31, 2020			October 30, 2021			October 31, 2020
	(Fiscal 2021)		(Fiscal 2020)			(Fiscal 2021)			(Fiscal 2020)
Net income (loss)	$	13,656	$	(7,022	)	$	46,804		$	(59,462	)

Other comprehensive income before taxes:
Foreign currency translation		2		-			(40	)		(39	)
Pension plans		77		247			233			742
Other comprehensive income before taxes		79		247			193			703
Tax provision related to items of other comprehensive income		—		—			—			—
Other comprehensive income, net of tax		79		247			193			703
Comprehensive income (loss)	$	13,735	$	(6,775	)	$	46,997		$	(58,759	)

The accompanying notes are an integral part of the consolidated financial statements.

DESTINATION XL GROUP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

(In thousands)

(Unaudited)


																			Accumulated
							Additional												Other
	Common Stock						Paid-in			Treasury Stock						Accumulated			Comprehensive
	Shares			Amounts			Capital			Shares			Amounts			Deficit			Income (Loss)			Total
Balance at January 30, 2021		64,656		$	647		$	314,747			(12,755	)	$	(92,658	)	$	(220,592	)	$	(6,221	)	$	(4,077	)
Issuance of common stock through private direct offering, net of offering costs		11,111			111			4,264															4,375
Board of directors compensation		137			1			108															109
Stock compensation expense								327															327
Issuance of common stock, upon RSUs release		308			3			(3	)														—
Accumulated other comprehensive income (loss):
Pension plan, net of taxes																				78			78
Foreign currency, net of taxes																				(25	)		(25	)
Net income																	8,697						8,697
Balance at May 1, 2021		76,212		$	762		$	319,443			(12,755	)	$	(92,658	)	$	(211,895	)	$	(6,168	)	$	9,484
Board of directors compensation		70			1			109															110
Stock compensation expense								316															316
Exercise of stock options		7			—			4															4
Accumulated other comprehensive income (loss):
Pension plan, net of taxes																				78			78
Foreign currency, net of taxes																				(17	)		(17	)
Net income																	24,451						24,451
Balance at July 31, 2021		76,289		$	763		$	319,872			(12,755	)	$	(92,658	)	$	(187,444	)	$	(6,107	)	$	34,426
Board of directors compensation		15			—			77															77
Stock compensation expense								295															295
Issuance of common stock, upon PSUs release		240			3			(3	)														—
Exercise of stock options		423			4			342															346
Shares withheld for taxes related to net share settlements		(190	)		(2	)		(1,144	)														(1,146	)
Accumulated other comprehensive income (loss):																							—
Pension plan, net of taxes																				77			77
Foreign currency, net of taxes																				2			2
Net income																	13,656						13,656
Balance at October 30, 2021		76,777		$	768		$	319,439			(12,755	)	$	(92,658	)	$	(173,788	)	$	(6,028	)	$	47,733

The accompanying notes are an integral part of the consolidated financial statements.

DESTINATION XL GROUP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(In thousands)

(Unaudited)