Destination XL Group, Inc. (NASDAQ: DXLG), the largest integrated
commerce specialty retailer of Big + Tall men’s clothing and shoes,
today reported financial results for the fourth quarter and fiscal
year 2022.
Fourth Quarter Highlights
- Total sales for the fourth quarter were $143.9 million, up 7.8%
from $133.5 million for fiscal 2021. Comparable sales for the
fourth quarter increased 10.8% as compared to the fourth quarter of
fiscal 2021.
- Net income for the fourth quarter was $8.3 million, or $0.13
per diluted share, as compared to net income of $9.9 million, or
$0.14 per diluted share, for the fourth quarter of fiscal
2021.
- Adjusted EBITDA, a non-GAAP measure, was $14.2 million for the
fourth quarter as compared to $14.3 million for the fourth quarter
of fiscal 2021.
Fiscal 2022 Highlights
- Total sales for fiscal 2022 were $545.8 million as compared to
$505.0 million for fiscal 2021. Comparable sales increased 10.9% as
compared to fiscal 2021.
- Net income was $89.1 million, or $1.33 per diluted share, as
compared to $56.7 million, or $0.83 per diluted share, in fiscal
2021. Net income for fiscal 2022 included a non-recurring tax
benefit for the release of our tax valuation allowance of $31.6
million, or $0.47 per diluted share.
- Adjusted EBITDA was $73.8 million as compared to $76.9 million
for fiscal 2021.
- Cash flow from operations for fiscal 2022 was $59.9 million, as
compared to $75.5 million for fiscal 2021. Free cash flow, a
non-GAAP measure, was $50.3 million as compared to $70.3 million
for fiscal 2021.
- At January 28, 2023, total cash and cash equivalents were $52.1
million as compared to $15.5 million at January 29, 2022, with no
outstanding debt for either period.
- On March 14, 2023, the Board authorized a $15.0 million stock
repurchase program, effective March 16, 2023.
Management Comments
“We are pleased to report our second year of
record-breaking sales, with eight consecutive quarters of positive
comparable sales and two consecutive years of double-digit adjusted
EBITDA margins. We exceeded our sales and margin plan this year, in
both our stores and direct business, with an increase of 10.9% in
comparable sales which we believe was driven by the brand’s
strategic transformational repositioning,” said Harvey Kanter,
President, and Chief Executive Officer.
“Heading into fiscal 2023, we remain focused on
our primary objective of serving the underserved Big + Tall
consumer by providing him the opportunity to wear what he wants,”
Kanter continued. “Earlier this month, we launched our new brand
initiative “Wear What You Want”℠, further supporting this
positioning. We believe our greater gains in market share, by
increasing brand awareness and introducing our guy to the breadth
of exclusivity in our assortment, will give him the freedom to
choose his own style. At DXL, Big + Tall is all we do and we trade
on the belief that we offer superior fit, assortment, and
experience to him. This leads to a deeper level of engagement and
relationship with our customers that is built on respect, trust,
and belonging. We believe that the brand positioning is resonating
with the customer and is helping to grow market share as the brand
and category leader for the Big + Tall man.
“We are excited about the results of the past two
years and are equally excited about the opportunity to
operationalize “Wear What You Want” and believe that this will
support the greater growth potential to drive our 2023 strategic
initiatives. We also recognize that there are many macro-economic
pressures that could impact us in the short term and our growth
strategy as we head into fiscal 2023 and so we continue to be
conservatively optimistic when thinking about guidance. As such, we
are planning for sales in fiscal 2023 of $550.0 million to $570.0
million and an adjusted EBITDA margin of 12.5% to 13.5%,” Kanter
concluded.
Fourth-Quarter and Fiscal 2022
Results
Sales
For the fourth quarter of fiscal 2022, total sales
were $143.9 million as compared to $133.5 million for the fourth
quarter of fiscal 2021. Comparable sales for the fourth quarter
increased 10.8%, driven by a 13.2% comparable sales increase from
stores and a 6.2% increase in the direct business. Sales for the
quarter started slowly with comparable sales for November up 2.7%,
but accelerated up 10.8% in December and then up 23.7% in January.
The incremental increase in comparable sales in January was largely
driven by store traffic. All regions of the country performed well
in the fourth quarter with the southeast and south central stores
our strongest performers. The growth in our direct business of 6.2%
was driven primarily by our web and app.
For fiscal 2022, total sales increased 8.1% to
$545.8 million from $505.0 million for fiscal 2021. Comparable
sales increased 10.9%, with stores up 11.3% and the direct business
up 9.9%. Similar to the fourth quarter, all regions of the country
performed well in fiscal 2022 with southeast, south central and
northeast stores our strongest performers, and direct growth driven
primarily by our web and app.
Gross Margin
For the fourth quarter of fiscal 2022, gross
margin, inclusive of occupancy costs, was 47.7%, compared with a
gross margin of 49.8% for the fourth quarter of fiscal 2021. Our
gross margin rate for the fourth quarter decreased by 210 basis
points, due to a 270 basis point decrease in merchandise margins
partially offset by a 60 basis point improvement in occupancy
costs. The merchandise margin decrease was due to an increase in
cost associated with the launch of our loyalty program, an
anticipated increase in markdown rate against the prior year's
exceptionally low rate, increased direct shipping costs, and a
shift in overall merchandise mix from own brands to national
brands. These factors were partially offset by lower inbound
freight costs.
For fiscal 2022, gross margin, inclusive of
occupancy costs, was 49.9% as compared to 49.5% for fiscal 2021.
For the full year, our gross margin rate improved by 40 basis
points, driven by a 90 basis point improvement in occupancy costs
due to increased leverage from sales partially offset by a 50 basis
point decrease in merchandise margins. The decrease in merchandise
margin was due to increased costs for raw materials, increased
shipping costs driven by higher fuel costs and surcharges, and a
higher penetration of our marketplace business, which includes
commission costs. Those increases were partially offset by lower
promotional markdowns. We continue to optimize our pricing and
strategic promotional cadence to mitigate cost increases and
preserve our margin rates.
Selling, General & Administrative
SG&A expenses for the fourth quarter of fiscal
2022 were 37.8% of sales, compared with 39.0% in the fourth quarter
of fiscal 2021. On a dollar basis, SG&A expense increased by
$2.2 million. The increase was primarily due to increases in
payroll and marketing costs to support sales growth.
For fiscal 2022, SG&A expenses were 36.4% of
sales, compared to 34.2% in fiscal 2021. On a dollar basis,
SG&A expense for fiscal 2022 increased $25.8 million. The
increase was primarily due to an increase in marketing costs from
4.7% to 6.0% of sales to drive customer acquisition and engagement,
payroll costs to support sales growth and fill open positions, and
an increase in performance-based incentive accruals.
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 20.8% of
sales for fiscal 2022 as compared to 19.1% of sales for fiscal
2021. Corporate Support Costs, which include the distribution
center and corporate overhead costs, represented 15.6% of sales,
compared to 15.1% of sales for fiscal 2021.
Interest Income (Expense)
Interest income for fourth quarter of fiscal 2022
was $0.1 million, as compared to interest expense of $0.1 million
for the fourth quarter of fiscal 2021. In the fourth quarter of
fiscal 2022, we began investing in short-term, US government-backed
investments, which generated a net interest income position.
For fiscal 2022, interest expense was $0.3 million
as compared to interest expense of $4.4 million for fiscal 2021.
Interest expense in fiscal 2022 was limited as we had no
outstanding debt and no borrowings under our credit facility during
fiscal 2022 and was partially offset by interest income. Interest
expense for fiscal 2021 included a prepayment penalty of $1.1
million associated with the early prepayment of our long-term debt
in the third quarter of fiscal 2021.
Income Taxes
Since the end of fiscal 2013, we had maintained a
full valuation allowance against our deferred taxes assets. During
the second quarter of fiscal 2022, we determined that it was more
likely than not that the majority of our deferred tax assets will
be realized. In reaching this determination, we considered the
cumulative three years of profitability, our expectations regarding
the generation of future taxable income as well as the overall
improvement in our business and our current market position. As a
result, for fiscal 2022, the valuation allowance against our
deferred tax assets decreased by $47.6 million, of which $31.6
million was recorded as a non-recurring tax benefit in fiscal 2022
related to the release of the valuation allowance on deferred tax
assets expected to be realized in future periods. At January 28,
2023, we continued to provide a valuation allowance of $2.4 million
primarily against certain state and foreign net operating losses
("NOLs").
For fiscal 2022 and 2021, we recorded a current
income tax provision of $0.8 million and $0.9 million,
respectively, primarily related to income tax in states with
statutory limitations on the usage of NOLs.
Net Income
Net income for the fourth quarter of fiscal 2022
was $8.3 million, or $0.13 per diluted share, as compared to net
income for the fourth quarter of fiscal 2021 of $9.9 million, or
$0.14 per diluted share.
Net income for fiscal 2022 was $89.1 million, or
$1.33 per diluted share, as compared to a net income for fiscal
2021 of $56.7 million, or $0.83 per diluted share. Net income for
fiscal 2022 includes the reversal of $31.6 million, or $0.47 per
diluted share, of our deferred tax asset valuation allowance.
Adjusted EBITDA
Earnings before interest, taxes, depreciation and
amortization, adjusted for impairment (gain) of assets (adjusted
EBITDA), a non-GAAP measure, for the fourth quarter of fiscal 2022
were $14.2 million as compared to $14.3 million for the fourth
quarter of fiscal 2021.
For fiscal 2022, adjusted EBITDA was $73.8
million, as compared to $76.9 million for fiscal 2021. The slight
decrease in adjusted EBITDA for fiscal 2022 as compared to fiscal
2021 was due to deliberate investments in our business,
specifically in marketing, as well as attracting and retaining
talent, to drive our digital transformation and brand repositioning
to support sales growth.
Cash Flow
Cash flow from operations for fiscal 2022 was
$59.9 million as compared to $75.5 million for fiscal 2021. Capital
expenditures for fiscal 2022 were $9.6 million, as compared to $5.3
million for fiscal 2021. Free cash flow, a non-GAAP measure, was
$50.3 million as compared to $70.3 million in fiscal 2021.
The decrease in free cash flow was due to
replenishment of inventory in several categories that were depleted
last year, the payout of incentive-based awards, and an increase in
capital expenditures.
(in millions) |
|
Fiscal 2022 |
|
|
Fiscal 2021 |
|
Cash flow from operating activities (GAAP) |
|
$ |
59.9 |
|
|
$ |
75.5 |
|
Capital expenditures |
|
|
(9.6 |
) |
|
|
(5.3 |
) |
Free cash flow (non-GAAP) |
|
$ |
50.3 |
|
|
$ |
70.3 |
|
Non-GAAP Measures
Adjusted EBITDA, adjusted EBITDA margin 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
At January 28, 2023, we had cash and cash
equivalents of $52.1 million, with no outstanding debt and excess
availability under our credit facility of $78.4 million. This
compares to a cash balance of $15.5 million with no outstanding
debt and excess availability of $68.9 million at January 29, 2022.
As discussed below, during fiscal 2022, we used approximately $12.7
million of our available cash to repurchase shares of our common
stock.
Inventory was $93.0 million at January 28, 2023,
as compared to $81.8 million at January 29, 2022. Inventory at
January 28, 2023 is approximately 13.7% higher than the prior year,
but we are in a better inventory position than we were at the end
of 2021. As compared to fiscal 2019, or pre-pandemic levels, we
reduced our inventory by 9.2%, and our inventory turnover was up
over 30%. At January 28, 2023 clearance inventory was 7.9%, as
compared to 6.0% at January 29, 2022, which is below our historical
benchmark of approximately 10.0%. Given the ongoing macro-economic
concerns around inflation and consumer spending, managing our
inventory will remain a primary focus for us in fiscal 2023.
Stock Repurchase Program
In March 2022, our Board of Directors approved a
stock repurchase program. Under the stock repurchase program, we
were authorized to repurchase up to $15.0 million of our common
stock through open market and privately negotiated
transactions.
There were no repurchases of stock during the
fourth quarter of fiscal 2022. For fiscal 2022, we repurchased 2.9
million shares at an aggregate cost, including fees, of $12.7
million. Shares of repurchased common stock are held as treasury
stock. The stock repurchase program expired on March 15, 2023.
On March 14, 2023, the Board of Directors
authorized a new stock repurchase program, effective March 16,
2023, whereby we may repurchase up to $15.0 million of our common
stock through open market and privately negotiated transactions.
The timing and the amount of any repurchases of common stock will
be determined based on the Company’s evaluation of market
conditions and other factors. The stock repurchase program will
expire on March 16, 2024. The stock repurchase program may be
suspended, terminated or modified at any time for any reason. We
expect to finance the repurchases from operating funds and/or
periodic borrowings on our credit facility. Any repurchased common
stock will be held as treasury stock.
Store Information
During fiscal 2022, we closed nine stores,
converted one Casual Male XL store to a DXL store, and remodeled
two DXL stores. There were no new stores opened in fiscal 2022.
|
Year End 2020 |
|
Year End 2021 |
|
Year End 2022 |
|
|
# of Stores |
|
Sq Ft. (000’s) |
|
# of Stores |
|
Sq Ft. (000’s) |
|
# of Stores |
|
Sq Ft. (000’s) |
|
DXL retail |
|
226 |
|
|
1,718 |
|
|
220 |
|
|
1,678 |
|
|
218 |
|
|
1,663 |
|
DXL outlets |
|
17 |
|
|
82 |
|
|
16 |
|
|
80 |
|
|
16 |
|
|
80 |
|
CMXL retail |
|
46 |
|
|
152 |
|
|
35 |
|
|
115 |
|
|
28 |
|
|
92 |
|
CMXL outlets |
|
22 |
|
|
66 |
|
|
19 |
|
|
57 |
|
|
19 |
|
|
57 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
311 |
|
|
2,018 |
|
|
290 |
|
|
1,930 |
|
|
281 |
|
|
1,892 |
|
We believe that our store portfolio is a vital
asset to our business strategy and we expect to invest in stores
over the next several years as we strengthen the store portfolio.
Over the next three to five years, based on our preliminary store
development plan, we believe that we could potentially open up to
50 net new stores. For fiscal 2023, our plan is to convert 10 of
our existing Casual Male XL stores to DXL stores, remodel 5 of our
existing DXL stores, close 5 stores and open 3 new DXL stores. We
expect our capital expenditures to range from $19.0 million to
$21.0 million in fiscal 2023.
Digital Commerce Sales
We distribute our national brands and own brand
merchandise directly to consumers through our stores, website, app
and third-party marketplaces. Digital 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 through our
Universe platform or through a third-party marketplace. Our direct
business is a critical component of our business and an area of
significant growth opportunity for us. From fiscal 2019 to fiscal
2022, comparable sales in this channel have increased 58.3%.
Our comparable sales in our direct business
increased 9.9% as compared to fiscal 2021. For the fourth quarter
of fiscal 2022, our direct sales were $49.2 million, or 34.2% of
retail segment sales, as compared to $46.8 million, or 35.2% of
retail segment sales, in the fourth quarter of fiscal 2021. For the
year, our direct sales increased $14.9 million to 31.1% of retail
segment sales as compared to 31.0% for fiscal 2021.
Financial Outlook
As we head into fiscal 2023, we are maintaining
our sales growth orientation as we build off the sales momentum
from the past two years. Despite the macro-economic challenges and
uncertainties regarding consumer spending and how that might impact
sales demand, we believe our expectations for fiscal 2023 are
appropriately balanced.
Our guidance for fiscal 2023, based on a 53-week
year, is:
- Sales of $550.0 - $570.0 million
- Net income of $41.0 - $47.0 million
- Adjusted EBITDA margin of 12.5% - 13.5%
Conference Call
The Company will hold a conference call to review
its financial results on Thursday, March 16, 2023, at 9:00 a.m.
ET.
To participate in the live webcast, please
pre-register at:
https://register.vevent.com/register/BI565a4d5dcf7b4be5a8d1a74b891bb7c2.
Upon registering, you will be emailed a dial-in number, and unique
PIN.
For listen-only, please join and register at:
https://edge.media-server.com/mmc/p/ev6a3bfw. An archived version
of the webcast may be accessed by visiting the "Events" section of
the Company's investor relations 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 EBITDA margin and free cash
flow, and makes projections about adjusted EBITDA margin. 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, net income 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.
Adjusted EBITDA is calculated as earnings before
interest, taxes, depreciation and amortization and any asset
impairment charges or gains. Adjusted EBITDA margin is calculated
as adjusted EBITDA divided by 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.
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
maintain 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, if any.
About Destination XL Group,
Inc.
Destination XL Group, Inc. is the leading retailer
of Men’s Big + Tall apparel that provides the Big + Tall man the
freedom to choose his own style. Subsidiaries of Destination XL
Group, Inc. operate DXL Big + Tall retail and outlet stores and
Casual Male XL retail and outlet stores throughout the United
States, and an e-commerce website, DXL.COM, and mobile app, which
offer 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 our outlook
for fiscal 2023, including expected sales, net income, adjusted
EBITDA margin, expected capital expenditures and our strategic
initiatives for fiscal 2023; our ability to continue to attract new
customers and gain market share; expectations regarding the
realizability of our deferred tax assets; our ability to manage
inventory; and expected changes in our store portfolio and plan for
new or relocated stores. 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
17, 2022, 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
lingering effects of the global COVID-19 pandemic and its impact on
the Company’s results of operations; the impact of rising inflation
and the Russian invasion of Ukraine on the global economy;
potential labor shortages; and the Company’s ability to execute on
its digital and store 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 fiscal year ended |
|
|
|
January 28, 2023 |
|
|
January 29, 2022 |
|
|
|
January 28, 2023 |
|
|
January 29, 2022 |
|
|
|
Sales |
|
$ |
143,878 |
|
|
$ |
133,451 |
|
|
|
$ |
545,838 |
|
|
$ |
505,021 |
|
|
|
Cost of goods sold, including occupancy |
|
|
75,280 |
|
|
|
67,019 |
|
|
|
|
273,240 |
|
|
|
255,197 |
|
|
|
Gross profit |
|
|
68,598 |
|
|
|
66,432 |
|
|
|
|
272,598 |
|
|
|
249,824 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
|
54,349 |
|
|
|
52,106 |
|
|
|
|
198,790 |
|
|
|
172,962 |
|
|
|
Impairment (gain) of assets |
|
|
239 |
|
|
|
(241 |
) |
|
|
|
(159 |
) |
|
|
(2,344 |
) |
|
|
Depreciation and amortization |
|
|
3,633 |
|
|
|
4,195 |
|
|
|
|
15,381 |
|
|
|
17,226 |
|
|
|
Total expenses |
|
|
58,221 |
|
|
|
56,060 |
|
|
|
|
214,012 |
|
|
|
187,844 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
10,377 |
|
|
|
10,372 |
|
|
|
|
58,586 |
|
|
|
61,980 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income (expense), net |
|
|
99 |
|
|
|
(94 |
) |
|
|
|
(251 |
) |
|
|
(4,350 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision for income taxes |
|
|
10,476 |
|
|
|
10,278 |
|
|
|
|
58,335 |
|
|
|
57,630 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes |
|
|
2,156 |
|
|
|
369 |
|
|
|
|
(30,788 |
) |
|
|
917 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
8,320 |
|
|
$ |
9,909 |
|
|
|
$ |
89,123 |
|
|
$ |
56,713 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share - basic |
|
$ |
0.13 |
|
|
$ |
0.15 |
|
|
|
$ |
1.42 |
|
|
$ |
0.89 |
|
|
|
Net income per share - diluted |
|
$ |
0.13 |
|
|
$ |
0.14 |
|
|
|
$ |
1.33 |
|
|
$ |
0.83 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average number of common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
62,517 |
|
|
|
64,227 |
|
|
|
|
62,825 |
|
|
|
63,401 |
|
|
|
Diluted |
|
|
66,281 |
|
|
|
68,920 |
|
|
|
|
66,890 |
|
|
|
68,031 |
|
|
|
DESTINATION XL GROUP, INC. |
CONDENSED CONSOLIDATED BALANCE SHEETS |
January 28, 2023 and January 29, 2022 |
(In thousands) |
Unaudited |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January 28, |
|
|
January 29, |
|
|
|
|
2023 |
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
52,074 |
|
|
$ |
15,506 |
|
|
Inventories |
|
|
93,004 |
|
|
|
81,764 |
|
|
Other current assets |
|
|
8,934 |
|
|
|
8,725 |
|
|
Property and equipment, net |
|
|
39,062 |
|
|
|
44,442 |
|
|
Operating lease right-of-use assets |
|
|
124,356 |
|
|
|
127,812 |
|
|
Deferred income taxes, net of valuation allowance |
|
|
31,455 |
|
|
|
— |
|
|
Intangible assets |
|
|
1,150 |
|
|
|
1,150 |
|
|
Other assets |
|
|
563 |
|
|
|
559 |
|
|
Total assets |
|
$ |
350,598 |
|
|
$ |
279,958 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
27,548 |
|
|
$ |
25,165 |
|
|
Accrued expenses and other liabilities |
|
|
41,581 |
|
|
|
40,969 |
|
|
Operating leases |
|
|
144,241 |
|
|
|
155,605 |
|
|
Stockholders' equity |
|
|
137,228 |
|
|
|
58,219 |
|
|
Total liabilities and stockholders' equity |
|
$ |
350,598 |
|
|
$ |
279,958 |
|
|
CERTAIN COLUMNS IN THE FOLLOWING TABLES MAY NOT
FOOT DUE TO ROUNDING
GAAP TO NON-GAAP RECONCILIATION OF
ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN (Unaudited)
|
|
For the three months ended |
|
For the fiscal year ended |
|
|
January 28, 2023 |
|
|
January 29, 2022 |
|
|
|
January 28, 2023 |
|
|
January 29, 2022 |
|
|
(in millions, except margin percentages) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income, on a GAAP basis |
|
$ |
8.3 |
|
|
$ |
9.9 |
|
|
|
$ |
89.1 |
|
|
$ |
56.7 |
|
|
Add back: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes |
|
|
2.2 |
|
|
|
0.4 |
|
|
|
|
(30.8 |
) |
|
|
0.9 |
|
|
Interest (income) expense |
|
|
(0.1 |
) |
|
|
0.1 |
|
|
|
|
0.3 |
|
|
|
4.4 |
|
|
Depreciation and amortization |
|
|
3.6 |
|
|
|
4.2 |
|
|
|
|
15.4 |
|
|
|
17.2 |
|
|
EBITDA (non-GAAP) |
|
|
14.0 |
|
|
|
14.6 |
|
|
|
|
74.0 |
|
|
|
79.2 |
|
|
Add back: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment (gain) of assets |
|
|
0.2 |
|
|
|
(0.2 |
) |
|
|
|
(0.2 |
) |
|
|
(2.3 |
) |
|
Adjusted EBITDA (non-GAAP) |
|
$ |
14.2 |
|
|
$ |
14.3 |
|
|
|
$ |
73.8 |
|
|
$ |
76.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales |
|
$ |
143.9 |
|
|
$ |
133.5 |
|
|
|
$ |
545.8 |
|
|
$ |
505.0 |
|
|
Adjusted EBITDA margin (non-GAAP), as a percentage of sales |
|
|
9.9 |
% |
|
|
10.7 |
% |
|
|
|
13.5 |
% |
|
|
15.2 |
% |
|
GAAP TO NON-GAAP RECONCILIATION OF FREE
CASH FLOW (Unaudited)
|
|
For the fiscal year ended |
(in millions) |
|
January 28, 2023 |
|
|
January 29, 2022 |
|
|
Cash flow from operating activities (GAAP basis) |
|
$ |
59.9 |
|
|
$ |
75.5 |
|
|
Capital expenditures |
|
|
(9.6 |
) |
|
|
(5.3 |
) |
|
Free cash flow (non-GAAP) |
|
$ |
50.3 |
|
|
$ |
70.3 |
|
|
FISCAL 2023 FORECAST GAAP TO NON-GAAP
ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN RECONCILIATION
(Unaudited)
|
|
Projected |
|
|
|
|
|
Fiscal 2023 |
|
|
|
(in millions, except per share data and percentages) |
|
|
|
|
per diluted share |
Sales (53-week basis) |
|
$550.0 - $570.0 |
|
|
|
Net income (GAAP basis) |
|
$41.0 - $47.0 |
|
|
$0.61-$0.71 |
Add back: |
|
|
|
|
|
Provision for income taxes |
|
14.3 -16.5 |
|
|
|
Interest income, net |
|
|
(1.5 |
) |
|
|
Depreciation and amortization |
|
|
15.0 |
|
|
|
Adjusted EBITDA (non-GAAP basis) |
|
$68.8-$77.0 |
|
|
|
Adjusted EBITDA margin as a percentage of sales (non-GAAP
basis) |
|
12.5% - 13.5% |
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding - diluted |
|
|
66.6 |
|
|
|
Investor Contact:Investor.relations@dxlg.com603-933-0541
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