Duluth Holdings Inc. Announces Third Quarter 2024 Financial Results
Duluth Trading Company (DLTH) reported third quarter 2024 financial results with net sales of $127.1 million, down 8.1% year-over-year. The company posted a net loss of $28.5 million, with an adjusted net loss of $13.8 million. Gross margin improved by 210 basis points to 52.3%.
Direct-to-consumer sales decreased 8.3% to $79.8 million, while retail store sales fell 7.8% to $47.2 million. The company maintains a strong financial position with approximately $165 million in liquidity. For fiscal 2024, Duluth now expects net sales of approximately $640 million.
The company completed phase two of its fulfillment center network plan, which is projected to reduce overhead expenses by $1.2 million in Q4 and approximately $5.0 million annually.
Duluth Trading Company (DLTH) ha riportato i risultati finanziari del terzo trimestre 2024 con vendite nette di 127,1 milioni di dollari, in calo dell'8,1% rispetto all'anno precedente. L'azienda ha registrato una perdita netta di 28,5 milioni di dollari, con una perdita netta rettificata di 13,8 milioni di dollari. Il margine lordo è migliorato di 210 punti base, raggiungendo il 52,3%.
Le vendite dirette al consumatore sono diminuite dell'8,3% a 79,8 milioni di dollari, mentre le vendite nei negozi al dettaglio sono scese del 7,8% a 47,2 milioni di dollari. L'azienda mantiene una posizione finanziaria solida con circa 165 milioni di dollari in liquidità. Per l'anno fiscale 2024, Duluth prevede ora vendite nette di circa 640 milioni di dollari.
L'azienda ha completato la fase due del piano della rete dei centri di distribuzione, che dovrebbe ridurre le spese generali di 1,2 milioni di dollari nel Q4 e circa 5,0 milioni di dollari all'anno.
Duluth Trading Company (DLTH) reportó los resultados financieros del tercer trimestre de 2024 con ventas netas de 127,1 millones de dólares, una disminución del 8,1% interanual. La compañía reportó una pérdida neta de 28,5 millones de dólares, con una pérdida neta ajustada de 13,8 millones de dólares. El margen bruto mejoró en 210 puntos básicos, alcanzando el 52,3%.
Las ventas directas al consumidor disminuyeron un 8,3% a 79,8 millones de dólares, mientras que las ventas en tiendas minoristas cayeron un 7,8% a 47,2 millones de dólares. La compañía mantiene una sólida posición financiera con aproximadamente 165 millones de dólares en liquidez. Para el año fiscal 2024, Duluth ahora espera ventas netas de aproximadamente 640 millones de dólares.
La compañía completó la fase dos de su plan de red de centros de distribución, que se proyecta que reducirá los gastos generales en 1,2 millones de dólares en el cuarto trimestre y aproximadamente 5,0 millones de dólares anuales.
Duluth Trading Company (DLTH)는 2024년 3분기 재무 결과를 발표했으며, 순매출 1억 2,710만 달러로 지난해 대비 8.1% 감소했습니다. 회사는 순손실 2,850만 달러를 기록했으며, 조정된 순손실은 1,380만 달러입니다. 총 마진은 210bp 향상되어 52.3%에 도달했습니다.
소비자 직접 판매는 8.3% 감소하여 7,980만 달러에 이르렀고, 소매 매장 판매는 7.8% 감소하여 4,720만 달러를 기록했습니다. 회사는 약 1억 6,500만 달러의 유동성을 갖춘 강력한 재무 위치를 유지하고 있습니다. 2024 회계연도에 대해 Duluth는 현재 약 6억 4천만 달러의 순매출을 예상하고 있습니다.
회사는 물류 센터 네트워크 계획의 두 번째 단계를 완료했으며, 이는 4분기에 120만 달러, 연간 약 500만 달러의 간접비를 감소시킬 것으로 예상됩니다.
Duluth Trading Company (DLTH) a annoncé les résultats financiers du troisième trimestre 2024 avec des ventes nettes de 127,1 millions de dollars, en baisse de 8,1 % par rapport à l'année précédente. L'entreprise a enregistré une perte nette de 28,5 millions de dollars, avec une perte nette ajustée de 13,8 millions de dollars. La marge brute s'est améliorée de 210 points de base, atteignant 52,3 %.
Les ventes directes aux consommateurs ont diminué de 8,3 % pour s'établir à 79,8 millions de dollars, tandis que les ventes en magasin de détail ont chuté de 7,8 % pour atteindre 47,2 millions de dollars. L'entreprise maintient une solide position financière avec environ 165 millions de dollars de liquidités. Pour l'exercice 2024, Duluth prévoit désormais des ventes nettes d'environ 640 millions de dollars.
L'entreprise a terminé la phase deux de son plan de réseau de centres de distribution, qui devrait réduire les frais généraux de 1,2 million de dollars au quatrième trimestre et d'environ 5,0 millions de dollars par an.
Duluth Trading Company (DLTH) hat die Finanzzahlen für das dritte Quartal 2024 veröffentlicht, mit Nettoverkäufen von 127,1 Millionen Dollar, was einem Rückgang von 8,1% im Jahresvergleich entspricht. Das Unternehmen verzeichnete einen Nettoverlust von 28,5 Millionen Dollar, mit einem bereinigten Nettoverlust von 13,8 Millionen Dollar. Die Bruttomarge verbesserte sich um 210 Basispunkte auf 52,3%.
Der Direktvertrieb an Verbraucher ging um 8,3% auf 79,8 Millionen Dollar zurück, während die Einzelhandelsverkäufe um 7,8% auf 47,2 Millionen Dollar sanken. Das Unternehmen hat eine starke Finanzlage mit etwa 165 Millionen Dollar an Liquidität. Für das Geschäftsjahr 2024 erwartet Duluth nun Nettoverkäufe von etwa 640 Millionen Dollar.
Das Unternehmen hat die zweite Phase seines Erfüllungszentrumsnetzes abgeschlossen, was voraussichtlich die Gemeinkosten im vierten Quartal um 1,2 Millionen Dollar und jährlich um etwa 5 Millionen Dollar reduzieren wird.
- Gross margin improved 210 basis points to 52.3%
- Strong liquidity position of $165 million
- Fulfillment center optimization expected to save $5.0 million annually
- Digital traffic increased by double digits
- Average order value showed growth
- Net sales declined 8.1% to $127.1 million
- Net loss widened to $28.5 million from $10.5 million year-over-year
- Direct-to-consumer sales decreased 8.3% to $79.8 million
- Retail store sales declined 7.8% to $47.2 million
- SG&A expenses increased 1.2% to $82.9 million
Insights
The Q3 results reveal significant challenges for Duluth Holdings with
While gross margin improved by
The revised guidance suggesting margin compression and SG&A deleverage indicates continued pressure on profitability. However, the company maintains strong liquidity of
Duluth's performance reflects broader retail industry challenges, with both direct-to-consumer and retail store segments showing weakness. The
The company's strategic focus on inventory management and operational efficiency through the Adairsville fulfillment center shows promise, with fulfillment costs at
However, the revised outlook and continued pressure on transactions despite higher digital traffic indicate persistent headwinds in the near term, though Black Friday and Cyber Monday improvements offer some optimism.
Benefiting from our product and sourcing initiatives, gross margin expands 210 basis points to
Strong financial position with approximately
MOUNT HOREB, Wis., Dec. 05, 2024 (GLOBE NEWSWIRE) -- Duluth Holdings Inc. (dba, Duluth Trading Company) (“Duluth Trading” or the “Company”) (NASDAQ: DLTH), a lifestyle brand of men’s and women’s workwear, casual wear, outdoor apparel and accessories, today announced its financial results for the fiscal third quarter ended October 27, 2024.
Summary of the Third Quarter ended October 27, 2024
- Net sales of
$127.1 million - Net loss of
$28.5 million and adjusted net loss1 of$13.8 million , compared to net loss of$10.5 million in the prior year third quarter. Adjusted net loss of$13.8 million excludes$6.2 million of restructuring expense and$10.1 million valuation allowance on our deferred tax asset - EPS per diluted share of (
$0.85) ; Adjusted EPS1 of ($0.41) - Adjusted EBITDA2 decreased
$5.2 million from the prior year to ($6.8) million
1See Reconciliation of net loss to adjusted net loss and adjusted net loss to adjusted EPS in the accompanying financial tables.
2See Reconciliation of net loss to EBITDA and EBITDA to Adjusted EBITDA in the accompanying financial tables.
Management Commentary
President and CEO, Sam Sato commented, “Impacted by a combination of uncertain macro environment and unseasonably warm weather, our third quarter performance did not meet our expectations. Despite the macro and weather-related impacts, we were pleased to see growth in our average order value and a double-digit increase in digital traffic. That said, these were not enough to offset the year-over-year contraction in transactions. As a result, we began taking the necessary actions to increase our unit selling velocity beginning in late October and I am pleased to report that our top line trends have meaningfully improved leading into the all-important black Friday week and continued through cyber Monday.”
“As we enter the final peak selling weeks of the Holiday season, we are committed to prudently managing our inventory and ending the fiscal year in a clean, high quality position.”
“Looking past fiscal 2024, leveraging our advanced sourcing and product innovation functions, and led by our new Chief Merchant Eli Getson, we are significantly enhancing our go-forward assortment and inventory management.”
“Key initiatives tied to our Big Dam Blueprint are delivering tangible improvements including product cost reductions driven by our successful direct sourcing initiative and another quarter of cost per unit fulfillment benefits, a direct result from leveraging our fully operational and highly automated Adairsville fulfillment center. There is much work ahead of us and we are laser focused on improving operational and financial performance over the long term.”
Sato concluded, “As we look ahead to 2025 and beyond, we are building upon the success of our strategic initiatives, making meaningful progress on structural improvements, and embarking on Enterprise Planning, an end-to-end cross functional initiative to significantly enhance our operational and strategic planning processes.”
Operating Results for the Third Quarter ended October 27, 2024
Net sales decreased
Gross profit margin increased 210 basis points to
Selling, general and administrative expenses increased
As part of the Company’s in-depth review of the retail portfolio strategy, fulfillment center network, and benchmarking to identify structural opportunities to improve operating margin, working capital, and asset efficiency, the Company identified phase two of the fulfillment center network plan to maximize productivity and capacity.
As previously mentioned, during the third quarter last year, the Company went live with a highly automated fulfillment center in Adairsville, Georgia. The Adairsville facility processed over
The Company incurred total restructuring expenses related to the lease amendment of
Exiting the legacy facility is projected to reduce overhead expenses by approximately
Balance Sheet and Liquidity
The Company ended the quarter with
Fiscal 2024 Outlook
The Company is issuing new guidance for its fiscal 2024, superseding its previous guidance. For fiscal 2024, the Company now expects:
- Net sales of approximately
$640 million - Full year gross margin reduction of approximately 125 basis points versus prior year
- SG&A expenses, excluding the sales tax contingency, to deleverage by approximately 80 bps versus prior year
- Capital expenditures, inclusive of software hosting implementation costs, of approximately
$23 million
Conference Call Information
A conference call and audio webcast with analysts and investors will be held on Thursday, December 5, 2024 at 9:30 am Eastern Time, to discuss the results and answer questions.
- Live conference call: 844-875-6915 (domestic) or 412-317-6711 (international)
- Conference call replay available through December 12, 2024: 877-344-7529 (domestic) or 412-317-0088 (international)
- Replay access code: 2540359
- Live and archived webcast: ir.duluthtrading.com
Investors can pre-register for the earnings conference call to expedite their entry into the call and avoid waiting for a live operator. To pre-register for the call, please visit https://dpregister.com/sreg/10193192/fda17fd748 and enter your contact information. You will then be issued a personalized phone number and pin to dial into the live conference call. Investors can pre-register any time prior to the start of the conference call.
About Duluth Trading
Duluth Trading is a lifestyle brand for the Modern, Self-Reliant American. Based in Mount Horeb, Wisconsin, we offer high quality, solution-based casual wear, workwear and accessories for men and women who lead a hands-on lifestyle and who value a job well-done. We provide our customers an engaging and entertaining experience. Our marketing incorporates humor and storytelling that conveys the uniqueness of our products in a distinctive, fun way, and are available through our content-rich website, catalogs, and “store like no other” retail locations. We are committed to outstanding customer service backed by our “No Bull Guarantee” - if it’s not right, we’ll fix it. Visit our website at http://www.duluthtrading.com.
Non-GAAP Measurements
Management believes that non-GAAP financial measures may be useful in certain instances to provide additional meaningful comparisons between current results and results in prior operating periods. Within this release, including the tables attached hereto, reference is made to adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted net loss and adjusted earnings per share (EPS). See attached table “Reconciliation of Net Loss to EBITDA and EBITDA to Adjusted EBITDA,” for a reconciliation of net loss to EBITDA and EBITDA to Adjusted EBITDA for the three and nine months ended October 27, 2024, versus the three and nine months ended October 29, 2023 and attached table “Reconciliation of Net Loss to Adjusted Net Loss and Adjusted Net Loss to Adjusted EPS,” for a reconciliation of net loss to adjusted net loss and adjusted net loss to adjusted EPS for the three and nine months ended October 27, 2024.
Adjusted EBITDA is a metric used by management and frequently used by the financial community, which provides insight into an organization’s operating trends and facilitates comparisons between peer companies, since interest, taxes, depreciation and amortization can differ greatly between organizations as a result of differing capital structures and tax strategies. Adjusted EBITDA excludes certain items that are unusual in nature or not comparable from period to period.
Adjusted Net Loss and Adjusted EPS is a metric used by management and frequently used by the financial community, which provides insight into the effectiveness of our business strategies and to compare our performance against that of peer companies. Adjusted Net Loss and Adjusted EPS excludes restructuring expenses and a one-time estimated sales tax accrual that are not comparable from period to period.
The Company provides this information to investors to assist in comparisons of past, present and future operating results and to assist in highlighting the results of on-going operations. While the Company’s management believes that non-GAAP measurements are useful supplemental information, such adjusted results are not intended to replace the Company’s GAAP financial results and should be read in conjunction with those GAAP results.
Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts included in this press release, including statements concerning Duluth Trading's plans, objectives, goals, beliefs, business strategies, future events, business conditions, its results of operations, financial position and its business outlook, business trends and certain other information herein, including statements under the heading “Fiscal 2024 Outlook” are forward-looking statements. You can identify forward-looking statements by the use of words such as “may,” ”might,” “will,” “should,” “expect,” “plan,” “anticipate,” “could,” “believe,” “estimate,” “project,” “target,” “predict,” “intend,” “future,” “budget,” “goals,” “potential,” “continue,” “design,” “objective,” “forecasted,” “would” and other similar expressions. The forward-looking statements are not historical facts, and are based upon Duluth Trading's current expectations, beliefs, estimates, and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond Duluth Trading's control. Duluth Trading's expectations, beliefs and projections are expressed in good faith, and Duluth Trading believes there is a reasonable basis for them. However, there can be no assurance that management's expectations, beliefs, estimates, and projections will be achieved and actual results may vary materially from what is expressed in or indicated by the forward-looking statements. Forward-looking statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the forward-looking statements, including, among others, the risks, uncertainties, and factors set forth under Part 1, Item 1A “Risk Factors” in the Company’s Annual Report on Form 10-K filed with the SEC on March 22, 2024 and other factors as may be periodically described in Duluth Trading’s subsequent filings with the SEC. These risks and uncertainties include, but are not limited to, the following: the impact of inflation and measures to control inflation on our results of operations; the prolonged effects of economic uncertainties on store and website traffic and disruptions to our distribution network, supply chains and operations; failure to effectively manage inventory levels; our ability to maintain and enhance a strong brand and sub-brand image; adapting to declines in consumer confidence, inflation and decreases in consumer spending; disruptions in our e-commerce platform; effectively adapting to new challenges associated with our expansion into new geographic markets; our ability to meet customer delivery time expectations; natural disasters, unusually adverse weather conditions, boycotts, prolonged public health crises, epidemics or pandemics and unanticipated events; generating adequate cash from our existing stores and direct sales to support our growth; the impact of changes in corporate tax regulations and sales tax; identifying and responding to new and changing customer preferences; the success of the locations in which our stores are located; effectively relying on sources for merchandise located in foreign markets; transportation delays and interruptions, including port congestion; inability to timely and effectively obtain shipments of products from our suppliers and deliver merchandise to our customers; the inability to maintain the performance of a maturing store portfolio; our inability to deploy marketing tactics to strengthen brand awareness and attract new customers in a cost effective manner; our ability to successfully open new stores; competing effectively in an environment of intense competition; our ability to adapt to significant changes in sales due to the seasonality of our business; price reductions or inventory shortages resulting from failure to purchase the appropriate amount of inventory in advance of the season in which it will be sold; the potential for further increases in price and availability of raw materials; our dependence on third-party vendors to provide us with sufficient quantities of merchandise at acceptable prices; the susceptibility of the price and availability of our merchandise to international trade conditions; failure of our vendors and their manufacturing sources to use acceptable labor or other practices; our dependence upon key executive management or our inability to hire or retain the talent required for our business; increases in costs of fuel or other energy, transportation or utility costs and in the costs of labor and employment; failure of our information technology systems to support our current and growing business, before and after our planned upgrades; disruptions in our supply chain and fulfillment centers; our inability to protect our trademarks or other intellectual property rights; infringement on the intellectual property of third parties; acts of war, terrorism or civil unrest; the impact of governmental laws and regulations and the outcomes of legal proceedings; changes in U.S. and non-U.S. laws affecting the importation and taxation of goods, including imposition of unilateral tariffs on imported goods; our ability to secure the personal and/or financial information of our customers and employees; our ability to comply with the security standards for the credit card industry; our failure to maintain adequate internal controls over our financial and management systems; acquisition, disposition, and development risks; and other factors that may be disclosed in our SEC filings or otherwise. Forward-looking statements speak only as of the date the statements are made. Duluth Trading assumes no obligation to update forward-looking statements to reflect actual results, subsequent events or circumstances or other changes affecting forward-looking information except to the extent required by applicable securities laws.
Investor Contacts:
Tom Filandro
ICR, Inc.
(646) 277-1200
DuluthIR@icrinc.com
(Tables Follow)
| DULUTH HOLDINGS INC. Condensed Consolidated Balance Sheets (Unaudited) (Amounts in thousands) | |||||||||||
| October 27, 2024 | January 28, 2024 | October 29, 2023 | |||||||||
| ASSETS | |||||||||||
| Current Assets: | |||||||||||
| Cash and cash equivalents | $ | 9,335 | $ | 32,157 | $ | 8,177 | |||||
| Receivables | 4,396 | 5,955 | 5,679 | ||||||||
| Income tax receivable | 138 | 617 | 99 | ||||||||
| Inventory, net | 231,430 | 125,757 | 173,966 | ||||||||
| Prepaid expenses & other current assets | 18,991 | 16,488 | 15,597 | ||||||||
| Total current assets | 264,290 | 180,974 | 203,518 | ||||||||
| Property and equipment, net | 116,941 | 132,718 | 133,946 | ||||||||
| Operating lease right-of-use assets | 101,784 | 121,430 | 125,125 | ||||||||
| Finance lease right-of-use assets, net | 33,802 | 40,315 | 45,010 | ||||||||
| Available-for-sale security | 4,840 | 4,986 | 4,867 | ||||||||
| Other assets, net | 11,442 | 9,020 | 9,861 | ||||||||
| Deferred tax assets | — | 1,010 | 3,686 | ||||||||
| Total assets | $ | 533,099 | $ | 490,453 | $ | 526,013 | |||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||||||
| Current liabilities: | |||||||||||
| Trade accounts payable | $ | 104,546 | $ | 51,122 | $ | 53,522 | |||||
| Accrued expenses and other current liabilities | 36,252 | 30,930 | 31,776 | ||||||||
| Current portion of operating lease liabilities | 15,439 | 16,401 | 16,067 | ||||||||
| Current portion of finance lease liabilities | 2,502 | 3,149 | 3,047 | ||||||||
| Duluth line of credit | 44,000 | — | 36,000 | ||||||||
| Current maturities of TRI long-term debt1 | 909 | 847 | 827 | ||||||||
| Total current liabilities | 203,648 | 102,449 | 141,239 | ||||||||
| Operating lease liabilities, less current maturities | 88,441 | 106,413 | 110,450 | ||||||||
| Finance lease liabilities, less current maturities | 31,272 | 34,276 | 35,104 | ||||||||
| TRI long-term debt, less current maturities1 | 24,510 | 25,141 | 25,346 | ||||||||
| Deferred tax liabilities | 123 | — | — | ||||||||
| Total liabilities | 347,994 | 268,279 | 312,139 | ||||||||
| Shareholders' equity: | |||||||||||
| Treasury stock | (2,331 | ) | (1,738 | ) | (1,737 | ) | |||||
| Capital stock | 107,224 | 103,579 | 102,565 | ||||||||
| Retained earnings | 83,660 | 123,816 | 116,833 | ||||||||
| Accumulated other comprehensive loss, net | (426 | ) | (427 | ) | (553 | ) | |||||
| Total shareholders' equity of Duluth Holdings Inc. | 188,127 | 225,230 | 217,108 | ||||||||
| Noncontrolling interest | (3,022 | ) | (3,056 | ) | (3,234 | ) | |||||
| Total shareholders' equity | 185,105 | 222,174 | 213,874 | ||||||||
| Total liabilities and shareholders' equity | $ | 533,099 | $ | 490,453 | $ | 526,013 | |||||
1Represents debt of the variable interest entity, TRI Holdings, LLC, that is consolidated in accordance with ASC 810, Consolidation. Duluth Holdings Inc. is not the guarantor nor the obligor of this debt.
| DULUTH HOLDING INC. Consolidated Statements of Operations (Unaudited) (Amounts in thousands, except per share figures) | |||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
| October 27, 2024 | October 29, 2023 | October 27, 2024 | October 29, 2023 | ||||||||||||
| Net sales | $ | 127,056 | $ | 138,210 | $ | 385,359 | $ | 401,068 | |||||||
| Cost of goods sold (excluding depreciation and amortization) | 60,645 | 68,806 | 183,328 | 194,530 | |||||||||||
| Gross profit | 66,411 | 69,404 | 202,031 | 206,538 | |||||||||||
| Selling, general and administrative expenses1 | 82,850 | 81,832 | 229,731 | 224,958 | |||||||||||
| Restructuring expense | 6,152 | — | 7,748 | — | |||||||||||
| Operating loss | (22,591 | ) | (12,428 | ) | (35,448 | ) | (18,420 | ) | |||||||
| Interest expense | 1,251 | 1,219 | 3,232 | 3,033 | |||||||||||
| Other income, net | 6 | 47 | 167 | 304 | |||||||||||
| Loss before income taxes | (23,836 | ) | (13,600 | ) | (38,513 | ) | (21,149 | ) | |||||||
| Income tax expense (benefit) | 4,688 | (3,126 | ) | 1,609 | (4,786 | ) | |||||||||
| Net loss | (28,524 | ) | (10,474 | ) | (40,122 | ) | (16,363 | ) | |||||||
| Less: Net income (loss) attributable to noncontrolling interest | 15 | (8 | ) | 34 | (24 | ) | |||||||||
| Net loss attributable to controlling interest | $ | (28,539 | ) | $ | (10,466 | ) | $ | (40,156 | ) | $ | (16,339 | ) | |||
| Basic earnings per share (Class A and Class B): | |||||||||||||||
| Weighted average shares of common stock outstanding | 33,448 | 32,987 | 33,314 | 32,937 | |||||||||||
| Net loss per share attributable to controlling interest | $ | (0.85 | ) | $ | (0.32 | ) | $ | (1.21 | ) | $ | (0.50 | ) | |||
| Diluted earnings per share (Class A and Class B): | |||||||||||||||
| Weighted average shares and equivalents outstanding | 33,448 | 32,987 | 33,314 | 32,937 | |||||||||||
| Net loss per share attributable to controlling interest | $ | (0.85 | ) | $ | (0.32 | ) | $ | (1.21 | ) | $ | (0.50 | ) | |||
1In conjunction with ongoing state sales tax audits the Company began a review of its sales tax positions. As a result of the review, the Company recorded an estimated sales tax expense accrual of
| DULUTH HOLDINGS INC. Consolidated Statements of Cash Flows (Unaudited) (Amounts in thousands) | |||||||
| Nine Months Ended | |||||||
| October 27, 2024 | October 29, 2023 | ||||||
| Cash flows from operating activities: | |||||||
| Net loss | $ | (40,122 | ) | $ | (16,363 | ) | |
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
| Depreciation and amortization | 24,730 | 23,434 | |||||
| Stock based compensation | 3,352 | 3,305 | |||||
| Deferred income taxes | 1,133 | (4,800 | ) | ||||
| Loss on disposal of property and equipment | 102 | 37 | |||||
| Changes in operating assets and liabilities: | |||||||
| Receivables | 1,559 | 362 | |||||
| Income taxes receivable | 479 | (99 | ) | ||||
| Inventory | (105,673 | ) | (19,044 | ) | |||
| Prepaid expense & other current assets | (585 | ) | (952 | ) | |||
| Software hosting implementation costs, net | (4,485 | ) | (800 | ) | |||
| Trade accounts payable | 53,160 | (10,171 | ) | ||||
| Income taxes payable | — | (1,761 | ) | ||||
| Accrued expenses and deferred rent obligations | 5,286 | (3,691 | ) | ||||
| Other assets | (3 | ) | 20 | ||||
| Noncash lease impacts | 2,942 | (483 | ) | ||||
| Net cash used in operating activities | (58,125 | ) | (31,006 | ) | |||
| Cash flows from investing activities: | |||||||
| Purchases of property and equipment | (5,813 | ) | (39,958 | ) | |||
| Principal receipts from available-for-sale security | 147 | 133 | |||||
| Net cash used in investing activities | (5,666 | ) | (39,825 | ) | |||
| Cash flows from financing activities: | |||||||
| Net borrowings on line of credit | 44,000 | 36,000 | |||||
| Payments on TRI long term debt | (623 | ) | (564 | ) | |||
| Payments on finance lease obligations | (2,109 | ) | (2,116 | ) | |||
| Payments of tax withholding on vested restricted shares | (593 | ) | (278 | ) | |||
| Other | 294 | 418 | |||||
| Net cash provided by financing activities | 40,969 | 33,460 | |||||
| Decrease in cash and cash equivalents | (22,822 | ) | (37,371 | ) | |||
| Cash and cash equivalents at beginning of period | 32,157 | 45,548 | |||||
| Cash and cash equivalents at end of period | $ | 9,335 | $ | 8,177 | |||
| Supplemental disclosure of cash flow information: | |||||||
| Interest paid | $ | 3,232 | $ | 3,033 | |||
| Income taxes paid | $ | 125 | $ | 1,875 | |||
| Supplemental disclosure of non-cash information: | |||||||
| Unpaid liability to acquire property and equipment | $ | 2,173 | $ | 8,391 | |||
| DULUTH HOLDINGS INC. Reconciliation of Net Loss to EBITDA and EBITDA to Adjusted EBITDA For the Fiscal Quarter and Nine Months Ended October 27, 2024 and October 29, 2023 (Unaudited) (Amounts in thousands) | |||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
| October 27, 2024 | October 29, 2023 | October 27, 2024 | October 29, 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Net loss | $ | (28,524 | ) | $ | (10,474 | ) | $ | (40,122 | ) | $ | (16,363 | ) | |||
| Depreciation and amortization | 7,284 | 8,566 | 23,581 | 23,434 | |||||||||||
| Amortization of internal-use software hosting subscription implementation costs | 1,394 | 1,227 | 3,856 | 3,647 | |||||||||||
| Interest expense | 1,251 | 1,219 | 3,232 | 3,033 | |||||||||||
| Income tax expense (benefit) | 4,688 | (3,126 | ) | 1,609 | (4,786 | ) | |||||||||
| EBITDA | $ | (13,907 | ) | $ | (2,588 | ) | $ | (7,844 | ) | $ | 8,965 | ||||
| Stock based compensation | 969 | 1,021 | 3,352 | 3,305 | |||||||||||
| Restructuring expense | 6,152 | — | 7,748 | — | |||||||||||
| Sales tax expense accrual | — | — | 2,406 | — | |||||||||||
| Adjusted EBITDA | $ | (6,786 | ) | $ | (1,567 | ) | $ | 5,662 | $ | 12,270 | |||||
| DULUTH HOLDINGS INC. Reconciliation of Net Loss to Adjusted Net Loss and Adjusted Net Loss to Adjusted EPS For the Fiscal Quarter and Nine Months Ended October 27, 2024 (Unaudited) (Amounts in thousands) | |||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||
| October 27, 2024 | October 27, 2024 | ||||||||||||||
| (in thousands, except per share amounts) | Amount | Per share | Amount | Per share | |||||||||||
| Net loss attributable to controlling interest | $ | (28,539 | ) | $ | (0.85 | ) | $ | (40,156 | ) | $ | (1.21 | ) | |||
| Plus: Restructuring expenses | 6,152 | 0.18 | 7,748 | 0.24 | |||||||||||
| Plus: Sales tax expense accrual | - | - | 2,406 | 0.07 | |||||||||||
| Plus: Income tax effect of restructuring and sales tax accrual1 | (1,415 | ) | (0.04 | ) | (2,335 | ) | (0.06 | ) | |||||||
| Adjusted net loss before valuation allowance | (23,802 | ) | (0.71 | ) | (32,337 | ) | (0.96 | ) | |||||||
| Plus: Valuation Allowance | 10,051 | 0.30 | 10,051 | 0.30 | |||||||||||
| Adjusted net loss attributable to controlling interest | $ | (13,751 | ) | $ | (0.41 | ) | $ | (22,286 | ) | $ | (0.66 | ) | |||
1Restructuring expenses and sales tax accrual tax effect using the Company’s estimated
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FAQ
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