Destination XL Group, Inc. (NASDAQ: DXLG), the largest omni-channel
specialty retailer of big and tall men's clothing, today reported
operating results for the second quarter of fiscal 2020 and
provided a business update with respect to the COVID-19 pandemic.
Management’s Response to COVID-19
“Our second quarter performance was better than we anticipated,
driven by our DXL.com website’s 69% growth and opening stores
sooner than initially expected. Although this performance permits
us to be cautiously optimistic, we remain exposed to the ongoing
challenges brought on by the COVID-19 pandemic. Our stores began to
reopen in late April and, by the end of June, all of our retail
locations were open. As you will hear me say often, we are striving
to maintain a balance between short-term performance and protecting
the long-term viability of the Company. During the quarter, we saw
gradual improvements in store sales despite curtailed store
operating hours. The strong growth in our direct business is a
direct outcome of the digital strategies we have implemented and
consumers’ shift in shopping preferences further grow in response
to COVID-19. Given this increased demand, we have been fortunate
that our digital strategies were well-defined and the distribution
center has been able to operate without any disruption. We also saw
positive growth in our wholesale business during the second
quarter, and were quick to mobilize the sourcing and manufacture of
protective masks,” said Harvey Kanter, President and Chief
Executive Officer.
Kanter continued, “We continued to be very proactive during the
second quarter in managing our liquidity. We have worked very
closely with our landlords, who have been great partners in helping
us make short-term accommodations to manage our cash flow while our
stores were closed. We also restructured our business to reduce
operating costs, where possible, to adjust to the sales decline.
The majority of our associates were on furlough through the end of
the first quarter and we began to gradually bring them back this
quarter as our stores reopened. We did our best to protect our
associates during furlough, extending benefits as long as we could.
However, there were approximately 430 associates who we were not
able to bring back, mostly store personnel, in order to align our
field organization with the reduced sales base.
At the end of the second quarter of fiscal 2020, we had a cash
balance of $20.4 million, total debt of $81.4 million and remaining
availability under our credit facility of $12.4 million. Our focus
on cash has been relentless. Over the past two quarters, we have
worked with our vendors on extended payment terms, including
entering into short-term promissory terms with vendors, and rent
concessions with the majority of our landlords. We have a cash
management plan for the next 12 months and we believe that we have
sufficient liquidity to navigate our working capital needs given no
further significant shutdowns of the economy,” Mr. Kanter
concluded.
Second Quarter Financial Highlights
- Total sales for the second quarter were $76.4 million, down
38.0% from $123.2 million in the prior-year second quarter.
- Cash Flow from operations of ($9.0) million as compared to the
prior year of $0.9 million. Free Cash Flow was ($11.1) million as
compared to ($6.7) million last year.
- Net loss for the second quarter was $(10.7) million as compared
to net income of $0.0 million in the prior year’s second
quarter.
- Adjusted EBITDA for the second quarter was $(4.3) million
compared to $7.1 million in the prior-year quarter.
- At August 1, 2020, cash balance of $20.4 million, total debt of
$81.4 million and remaining availability under our credit facility
of $12.4 million.
Second Quarter Results
Sales
Total sales for the second quarter of fiscal 2020 decreased
38.0% to $76.4 million from $123.2 million in the second quarter of
fiscal 2019. We were able to reopen our retail stores sooner than
expected, and by the end of June, all locations had been reopened.
Given the nature of the pandemic, we experienced headwinds due to
the virus during the quarter in critically important states which
produce higher than average sales. Because our stores were closed
temporarily during much of the second quarter of fiscal 2020 and
continue to operate with reduced hours, we do not believe a
discussion of comparable sales is a meaningful metric at this time.
We continued to see a material shift to online shopping during the
second quarter and expect to see a similar trend through the
remainder of fiscal 2020. Overall sales in the second quarter were
driven by a 69% increase in our dxl.com business, which brought
total direct sales penetration up to 46.1% of total retail
sales.
Our wholesale business contributed $5.0 million in sales during
the second quarter, as compared to $2.7 million in the prior year,
driven primarily by the sale of $4.1 million in protective
masks.
Gross Margin
For the second quarter of fiscal 2020, our gross margin rate,
inclusive of occupancy costs, was 28.1% as compared to a gross
margin rate of 44.3% for the second quarter of fiscal 2019. Our
gross margin rate declined 5.1% from the deleveraging in occupancy
costs and a decrease of 11.1% in merchandise margins. We remained
highly promotional during the first half of the second quarter in
order to reduce inventories and drive our on-line business, but
began to scale back after Father’s Day. Our gross margin improved
significantly post Father’s Day, where we saw a merchandise margin
improvement of 1260 basis points for the month of July, as compared
to May. Because of the growth in our direct channel and free
shipping promotions, shipping costs for the second quarter
increased over the prior year.
Selling, General & Administrative
As a percentage of sales, SG&A (selling, general and
administrative) expenses for the second quarter of fiscal 2020 were
33.7% as compared to 38.5% for the second quarter of fiscal 2019.
On a dollar basis, SG&A decreased by $21.7 million, or 45.7%,
as compared to the second quarter of fiscal 2019. We took several
steps to reduce our operating costs while our stores were closed,
including the furlough of our store associates and certain
corporate associates, reduced marketing costs, a temporary salary
reduction of 10-20% for management, and the non-employee directors
voluntarily suspended their compensation for the second quarter. As
we reopened stores during the second quarter, our operating costs
were realigned with the expected sales levels and associates were
brought back on a staggered schedule. We continue to assess and
rationalize our entire SG&A cost structure. Given the changes
to our business as a result of this pandemic, we are restructuring
various areas to ensure that we can operate most efficiently. This
included the elimination of approximately 34 corporate positions in
the first quarter of fiscal 2020 and an additional 430 store
associates in the second quarter. With the reduced sales levels and
store traffic, our stores are operating at minimal staffing levels
and reduced operating hours.
Management views SG&A expenses through two primary cost
centers: Customer Facing Costs and Corporate Support Costs.
Customer Facing Costs, which include store payroll, marketing and
other store operating costs, represented 15.8% of sales in the
second quarter of fiscal 2020 as compared to 23.9% of sales in the
second quarter of last year. Corporate Support Costs, which include
the distribution center and corporate overhead costs, represented
17.9% of sales in the second quarter of fiscal 2020 compared to
14.6% of sales in the second quarter of last year.
Net Loss
For the second quarter of fiscal 2020, we had a net loss of
$(10.7) million, or $(0.21) per diluted share, compared with a net
income of $0.0 million, or $0.00 per diluted share, for the second
quarter of fiscal 2019.
On a non-GAAP basis, adjusting for a normalized tax rate of 26%
for both periods, the adjusted net loss for the second quarter of
fiscal 2020 was ($0.15) per diluted share, as compared to an
adjusted net income of $0.00 per diluted share for the second
quarter of fiscal 2019.
Adjusted EBITDA
Adjusted earnings before interest, taxes, depreciation and
amortization (Adjusted EBITDA), a non-GAAP measure, for the second
quarter of fiscal 2020 were $(4.3) million, compared to $7.1
million for the second quarter of fiscal 2019.
Cash Flow
Cash flow from operations for the first six months of fiscal
2020 was $(9.0) million as compared to $0.9 million for the first
six months of fiscal 2019 and free cash flow was $(11.1) million
for the first six months of fiscal 2020 as compared to $(6.7)
million for the first six months of fiscal 2019.
Preserving liquidity was our primary financial goal this
quarter. We have eliminated costs where possible and have reduced
the majority of our capital spending, unless such spending is
necessary to our immediate business needs. Our capital expenditures
for the first six months of fiscal 2020 were $2.1 million as
compared to $7.6 million for the same period last year.
|
|
For the six months ended |
|
(in millions) |
|
August 1, 2020 |
|
|
August 3, 2019 |
|
Cash flow from operating activities (GAAP basis) |
|
$ |
(9.0 |
) |
|
$ |
0.9 |
|
Capital expenditures,
infrastructure projects |
|
|
(1.4 |
) |
|
|
(5.2 |
) |
Capital expenditures for DXL
stores |
|
|
(0.7 |
) |
|
|
(2.4 |
) |
Free Cash Flow (non-GAAP basis) |
|
$ |
(11.1 |
) |
|
$ |
(6.7 |
) |
Non-GAAP Measures
Adjusted EBITDA, adjusted net income (loss),
adjusted net (income) loss per diluted share and free cash flow are
non-GAAP financial measures. Please see “Non-GAAP Measures” below
and reconciliations of these non-GAAP measures to the comparable
GAAP measures that follow in the tables below.
Balance Sheet & Liquidity
Managing our liquidity and financial flexibility
continues to be our primary goal as we navigate through this
pandemic. To this end, we have taken several actions since March,
including but not limited to: (i) amending our credit facility to
increase our borrowing base, (ii) decreasing our payroll and
operating costs to align with the expected decrease in revenues,
(iii) working with our landlords on short-term rent relief, (iv)
cancellation of purchase orders, and (v) negotiating extended
payment terms with our merchandise vendors.
At the end of the second quarter of fiscal 2020, we
had a cash balance of $20.4 million, total debt (which consists of
our revolving credit facility and long-term FILO loan) of $81.4
million and remaining availability under our credit facility of
$12.4 million. Our availability under our credit facility is based
on inventory levels, which are intentionally at lower levels given
the current environment. Total debt less cash for the second
quarter is $61.0 million compared to $58.7 million in the second
quarter of fiscal 2019. At August 1, 2020, the accounts payable
balance of $18.5 million included $2.0 million of promissory notes,
payable through April 1, 2021. During the second quarter of fiscal
2020, the Company entered into rent concessions with the majority
of its landlords, in the form of rent abatements and deferments. As
a result of lease modifications, the Company has reduced rent
payments by approximately $10.0 million for fiscal 2020.
As of August 1, 2020, our inventory decreased
approximately $23.0 million to $87.4 million, as compared to $110.4
million at August 3, 2019. We cancelled approximately $148 million,
at retail, of open orders leading into the second quarter. With
respect to the remainder of fiscal 2020, we expect to be responsive
to business changes, but expect that our fall inventory buys will
be below fiscal 2019 levels. Our objective is to maintain a healthy
inventory, which will include narrowing our assortment while also
continuing to manage clearance levels. At August 1, 2020, our
clearance inventory decreased by approximately $2.2 million,
representing 11.3% of our total inventory, as compared to 10.9% at
August 3, 2019.
Retail Store Information
Total retail square footage has remained relatively
constant since the end of fiscal 2017:
|
Year End 2017 |
|
Year End 2018 |
|
Year End 2019 |
|
At August 1, 2020 |
|
|
# ofStores |
|
Sq Ft.(000’s) |
|
# ofStores |
|
Sq Ft.(000’s) |
|
# ofStores |
|
Sq Ft.(000’s) |
|
# ofStores |
|
Sq Ft.(000’s) |
|
DXL retail |
|
212 |
|
|
1,665 |
|
|
216 |
|
|
1,684 |
|
|
228 |
|
|
1,729 |
|
|
228 |
|
|
1,729 |
|
DXL outlets |
|
14 |
|
|
72 |
|
|
15 |
|
|
78 |
|
|
17 |
|
|
82 |
|
|
17 |
|
|
82 |
|
CMXL retail |
|
78 |
|
|
268 |
|
|
66 |
|
|
221 |
|
|
50 |
|
|
164 |
|
|
49 |
|
|
160 |
|
CMXL outlets |
|
33 |
|
|
103 |
|
|
30 |
|
|
91 |
|
|
28 |
|
|
85 |
|
|
23 |
|
|
69 |
|
Rochester Clothing |
|
5 |
|
|
51 |
|
|
5 |
|
|
51 |
|
|
- |
|
|
- |
|
|
- |
|
- |
|
Total |
|
342 |
|
|
2,159 |
|
|
332 |
|
|
2,125 |
|
|
323 |
|
|
2,060 |
|
|
317 |
|
|
2,040 |
|
E-Commerce Information
The Company distributes its licensed branded and
private label products directly to consumers through its stores,
website and third-party marketplaces. E-commerce sales, which we
also refer to as direct sales, are defined as sales that originate
online, whether through our website, at the store level or through
a third-party marketplace. For the second quarter of fiscal 2020,
our direct sales increased by $7.6 million to 46.1% of retail
segment sales as compared to 21.1% for the second quarter of fiscal
2019. The increase in sales growth and penetration was driven by a
69% increase in sales on our own website at DXL.com. Even though
all of our stores had reopened by the end of June 2020, store
traffic has been slow to rebound and we continue to see our
e-commerce business playing a vital role in enabling us to continue
to engage with our customers. Our direct business will be a
critical component of how we navigate through the remainder of
fiscal 2020 and beyond.
Conference Call
The Company will hold a conference call to review
its financial results today, August 27, 2020 at 9:00 a.m. ET. To
listen to the live webcast, visit the "Investor Relations" section
of the Company's website. The live call also can be accessed by
dialing: (866) 680-2311. Please reference conference ID:
8157438. An archived version of the webcast may be
accessed by visiting the "Events" section of the Company's website
for up to one year.
During the conference call, the Company may discuss
and answer questions concerning business and financial developments
and trends. The Company’s responses to questions, as well as other
matters discussed during the conference call, may contain or
constitute information that has not been disclosed previously.
Non-GAAP Measures
In addition to financial measures prepared in
accordance with U.S. generally accepted accounting principles
(“GAAP”), this press release contains non-GAAP financial measures,
including adjusted EBITDA, adjusted net income (loss), adjusted net
income (loss) per diluted share and free cash flow. The
presentation of these non-GAAP measures is not in accordance with
GAAP, and should not be considered superior to or as a substitute
for net income (loss), net income (loss) per diluted share or cash
flows from operating activities or any other measure of performance
derived in accordance with GAAP. In addition, not all companies
calculate non-GAAP financial measures in the same manner and,
accordingly, the non-GAAP measures presented in this release may
not be comparable to similar measures used by other companies. The
Company believes the inclusion of these non-GAAP measures help
investors gain a better understanding of the Company’s performance,
especially when comparing such results to previous periods, and
that they are useful as an additional means for investors to
evaluate the Company's operating results, when reviewed in
conjunction with the Company's GAAP financial statements.
Reconciliations of these non-GAAP measures to their comparable GAAP
measures are provided in the tables below.
The Company believes that adjusted EBITDA
(calculated as earnings before interest, taxes, depreciation and
amortization and excluding CEO transition costs and asset
impairment charges, if applicable) is useful to investors in
evaluating its performance and is a key metric to measure
profitability and economic productivity.
The Company has fully reserved against its deferred
tax assets and, therefore, its net income (loss) is not reflective
of earnings assuming a “normal” tax position. In addition, we have
added back charges for costs associated with the CEO transition and
asset impairment charges, if applicable, because it provides
comparability of results without these charges. Adjusted net income
(loss) provides investors with a useful indication of the financial
performance of the business, on a comparative basis, assuming a
normalized effective tax rate of 26%.
Free cash flow is a metric that management uses to
monitor liquidity. Management believes this metric is important to
investors because it demonstrates the Company’s ability to
strengthen liquidity while supporting its capital projects and new
store growth. Free cash flow is calculated as cash flow from
operating activities, less capital expenditures and excludes the
mandatory and discretionary repayment of debt.
About Destination XL Group,
Inc.
Destination XL Group, Inc. is the largest retailer
of men’s clothing in sizes XL and up, with operations throughout
the United States as well as in Toronto, Canada. In addition to DXL
Big + Tall retail and outlet stores, subsidiaries of Destination XL
Group, Inc. also operate Casual Male XL retail and outlet stores,
and e-commerce sites, including DXL.com. DXL.com offers a
multi-channel solution similar to the DXL store experience with the
most extensive selection of online products available anywhere for
Big + Tall men. The Company is headquartered in Canton,
Massachusetts, and its common stock is listed on the NASDAQ Global
Market under the symbol "DXLG." For more information, please visit
the Company's investor relations website:
https://investor.dxl.com.
Forward-Looking Statements Certain
statements and information contained in this press release
constitute forward-looking statements under the federal securities
laws, including statements regarding the Company’s expectations for
performance in the second half of fiscal 2020, its ability to
maintain sufficient liquidity to meet its working capital needs,
expected inventory levels in the remainder of fiscal 2020 and the
impact of its direct business on results in the remainder of fiscal
2020. 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
Securities and Exchange Commission, including without limitation,
its Annual Report on Form 10-K filed on March 19, 2020, its
Quarterly Reports on Form 10-Q and other filings with the
Securities and Exchange Commission that set forth certain risks and
uncertainties that may have an impact on future results and
direction of the Company, including risks relating to the COVID-19
pandemic and its impact on the Company’s results of operations, the
Company’s execution of its DXL strategy and ability to grow its
market share, predict customer tastes and fashion trends, forecast
sales growth trends and compete successfully in the United States
men’s big and tall apparel market.
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.
DESTINATION XL GROUP, INC. |
|
CONSOLIDATED STATEMENTS OF OPERATIONS |
|
(In thousands, except per share data) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months ended |
|
|
For the six months ended |
|
|
|
August 1, 2020 |
|
|
August 3, 2019 |
|
|
August 1, 2020 |
|
|
August 3, 2019 |
|
Sales |
|
$ |
76,442 |
|
|
$ |
123,245 |
|
|
$ |
133,669 |
|
|
$ |
236,218 |
|
Cost of goods sold including
occupancy |
|
|
54,945 |
|
|
|
68,676 |
|
|
|
98,958 |
|
|
|
132,236 |
|
Gross profit |
|
|
21,497 |
|
|
|
54,569 |
|
|
|
34,711 |
|
|
|
103,982 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
|
25,795 |
|
|
|
47,478 |
|
|
|
57,907 |
|
|
|
92,089 |
|
CEO transition costs |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
702 |
|
Impairment of assets |
|
|
— |
|
|
|
— |
|
|
|
16,335 |
|
|
|
— |
|
Depreciation and amortization |
|
|
5,340 |
|
|
|
6,210 |
|
|
|
11,072 |
|
|
|
12,548 |
|
Total expenses |
|
|
31,135 |
|
|
|
53,688 |
|
|
|
85,314 |
|
|
|
105,339 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
|
(9,638 |
) |
|
|
881 |
|
|
|
(50,603 |
) |
|
|
(1,357 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net |
|
|
(1,052 |
) |
|
|
(851 |
) |
|
|
(1,793 |
) |
|
|
(1,715 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before provision
for income taxes |
|
|
(10,690 |
) |
|
|
30 |
|
|
|
(52,396 |
) |
|
|
(3,072 |
) |
Provision (benefit) for income
taxes |
|
|
24 |
|
|
|
(8 |
) |
|
|
44 |
|
|
|
(29 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(10,714 |
) |
|
$ |
38 |
|
|
$ |
(52,440 |
) |
|
$ |
(3,043 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share -
basic and diluted |
|
$ |
(0.21 |
) |
|
$ |
0.00 |
|
|
$ |
(1.03 |
) |
|
$ |
(0.06 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average number of
common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
51,078 |
|
|
|
49,867 |
|
|
|
50,918 |
|
|
|
49,734 |
|
Diluted |
|
|
51,078 |
|
|
|
50,175 |
|
|
|
50,918 |
|
|
|
49,734 |
|
DESTINATION XL GROUP, INC. |
|
CONDENSED CONSOLIDATED BALANCE SHEETS |
|
August 1, 2020, February 1, 2020 and August 3, 2019 |
|
(In thousands) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
August 1, |
|
February 1, |
|
August 3, |
|
|
|
2020 |
|
2020 |
|
2019 |
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
20,414 |
|
$ |
4,338 |
|
$ |
5,493 |
|
Inventories |
|
|
87,388 |
|
|
102,420 |
|
|
110,374 |
|
Other current assets |
|
|
12,482 |
|
|
17,102 |
|
|
16,821 |
|
Property and equipment,
net |
|
|
65,258 |
|
|
78,279 |
|
|
85,953 |
|
Operating lease right-of-use
assets |
|
|
157,095 |
|
|
186,413 |
|
|
200,480 |
|
Intangible assets |
|
|
1,150 |
|
|
1,150 |
|
|
1,150 |
|
Other assets |
|
|
593 |
|
|
1,215 |
|
|
3,453 |
|
Total assets |
|
$ |
344,380 |
|
$ |
390,917 |
|
$ |
423,724 |
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
18,533 |
|
$ |
31,763 |
|
$ |
36,929 |
|
Accrued expenses and other
liabilities |
|
|
26,140 |
|
|
23,390 |
|
|
21,380 |
|
Operating leases |
|
|
210,936 |
|
|
223,227 |
|
|
238,760 |
|
Long-term debt |
|
|
14,841 |
|
|
14,813 |
|
|
14,785 |
|
Borrowings under credit
facility |
|
|
66,545 |
|
|
39,301 |
|
|
49,451 |
|
Stockholders' equity |
|
|
7,385 |
|
|
58,423 |
|
|
62,419 |
|
Total liabilities and stockholders' equity |
|
$ |
344,380 |
|
$ |
390,917 |
|
$ |
423,724 |
|
CERTAIN COLUMNS IN THE FOLLOWING TABLES MAY NOT FOOT DUE TO
ROUNDING |
|
GAAP TO NON-GAAP RECONCILIATION OF ADJUSTED NET
LOSS |
AND ADJUSTED NET LOSS PER DILUTED SHARE |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months ended |
|
|
For the six months ended |
|
|
|
August 1, 2020 |
|
|
August 3, 2019 |
|
|
August 1, 2020 |
|
|
August 3, 2019 |
|
|
|
$ |
|
|
Per dilutedshare |
|
|
$ |
|
|
Per dilutedshare |
|
|
$ |
|
|
Per dilutedshare |
|
|
$ |
|
|
Per dilutedshare |
|
(in thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) (GAAP
basis) |
|
$ |
(10,714 |
) |
|
$ |
(0.21 |
) |
|
$ |
38 |
|
|
$ |
0.00 |
|
|
$ |
(52,440 |
) |
|
$ |
(1.03 |
) |
|
$ |
(3,043 |
) |
|
$ |
(0.06 |
) |
Adjust: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CEO transition costs |
|
|
- |
|
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
702 |
|
|
|
|
|
Impairment of assets |
|
|
- |
|
|
|
|
|
|
|
- |
|
|
|
|
|
|
|
16,335 |
|
|
|
|
|
|
|
- |
|
|
|
|
|
Add back actual income tax
provision (benefit) |
|
|
24 |
|
|
|
|
|
|
|
(8 |
) |
|
|
|
|
|
|
44 |
|
|
|
|
|
|
|
(29 |
) |
|
|
|
|
Add income tax (provision)
benefit, assuming a normal tax rate of 26% |
|
|
2,779 |
|
|
|
|
|
|
|
(8 |
) |
|
|
|
|
|
|
9,376 |
|
|
|
|
|
|
|
616 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income (loss)
(non-GAAP basis) |
|
$ |
(7,911 |
) |
|
$ |
(0.15 |
) |
|
$ |
22 |
|
|
$ |
0.00 |
|
|
$ |
(26,685 |
) |
|
$ |
(0.52 |
) |
|
$ |
(1,754 |
) |
|
$ |
(0.04 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of
common shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
outstanding on a diluted basis |
|
|
|
|
|
|
51,078 |
|
|
|
|
|
|
|
50,175 |
|
|
|
|
|
|
|
50,918 |
|
|
|
|
|
|
|
49,734 |
|
GAAP TO
NON-GAAP RECONCILIATION OF ADJUSTED EBITDA |
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months ended |
|
|
For the six months ended |
|
|
|
August 1, 2020 |
|
|
August 3, 2019 |
|
|
August 1, 2020 |
|
|
August 3, 2019 |
|
(in millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) (GAAP basis) |
|
$ |
(10.7 |
) |
|
$ |
0.0 |
|
|
$ |
(52.4 |
) |
|
$ |
(3.0 |
) |
Add back: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CEO transition costs |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
0.7 |
|
Impairment of assets |
|
|
- |
|
|
|
- |
|
|
|
16.3 |
|
|
|
- |
|
Provision (benefit) for income taxes |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Interest expense |
|
|
1.1 |
|
|
|
0.9 |
|
|
|
1.8 |
|
|
|
1.7 |
|
Depreciation and amortization |
|
|
5.3 |
|
|
|
6.2 |
|
|
|
11.1 |
|
|
|
12.5 |
|
Adjusted EBITDA (non-GAAP basis) |
|
$ |
(4.3 |
) |
|
$ |
7.1 |
|
|
$ |
(23.2 |
) |
|
$ |
11.9 |
|
GAAP TO NON-GAAP RECONCILIATION OF FREE CASH
FLOW |
(unaudited) |
|
|
|
|
|
|
|
For the six months ended |
|
(in millions) |
|
August 1, 2020 |
|
|
August 3, 2019 |
|
Cash flow from operating activities (GAAP basis) |
|
$ |
(9.0 |
) |
|
$ |
0.9 |
|
Capital expenditures,
infrastructure projects |
|
|
(1.4 |
) |
|
|
(5.2 |
) |
Capital expenditures for DXL
stores |
|
|
(0.7 |
) |
|
|
(2.4 |
) |
Free Cash Flow (non-GAAP basis) |
|
$ |
(11.1 |
) |
|
$ |
(6.7 |
) |
|
|
|
|
|
|
|
|
|
Investor Contact:
ICR, Inc.
Tom Filandro
646-277-1235
Tom.Filandro@icrinc.com
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