Core Insights - Destination XL Group, Inc. (DXLG) has opened a new store in Bellevue, WA, marking its seventh new store opening in the U.S. for the fiscal year [1][4] - The new store aims to enhance the shopping experience for Big + Tall men by offering a variety of brands and styles tailored to their needs [2][4] - DXL has introduced FiTMAPSM Sizing Technology in the Bellevue store, which captures 242 unique measurements for custom clothing options [3] Company Overview - Destination XL Group, Inc. is the leading retailer specializing in Big + Tall men's apparel, operating DXL Big + Tall and Casual Male XL stores across the U.S. [5] - The company provides a multi-channel shopping experience through its e-commerce website DXL.COM and mobile app, offering a wide selection of products for Big + Tall men [5]

Core Viewpoint - Destination XL Group, Inc. has updated its fiscal year 2024 guidance based on holiday sales results, indicating a slight decrease in expected total sales and adjusted EBITDA margin due to consumer spending challenges and price sensitivity [1][6]. Sales Performance - Total sales for the 9-week holiday period ended January 4, 2025, were $94.7 million, down from $102.4 million for the same period in the previous year [6]. - Comparable sales decreased by 7.4%, with in-store sales down 6.2% and direct business down 10.0% [6]. - November sales experienced a decline of 11.8%, but December saw an improvement with a decline of only 4.4% due to successful promotions during Black Friday and Cyber Monday [1]. Fiscal Year 2024 Guidance - Total sales for fiscal 2024 are now expected to be between $467.0 million and $470.0 million, a slight decrease from the previous guidance of $470.0 million [6]. - The adjusted EBITDA margin is projected to be between 4.2% and 4.5%, down from the previous guidance of 4.5% [6]. Financial Reporting - The company plans to report its actual fourth-quarter and fiscal 2024 financial results on March 20, 2025, during a conference call hosted by the CEO and CFO [2]. Non-GAAP Measures - The company provides adjusted EBITDA and adjusted EBITDA margin as non-GAAP measures to help investors better understand its performance [3][4]. - Adjusted EBITDA is calculated as earnings before interest, taxes, depreciation, and amortization, adjusted for any asset impairment charges [4]. Company Overview - Destination XL Group, Inc. is a leading retailer specializing in Big + Tall men's apparel, operating both physical stores and an e-commerce platform [5]. - The company is headquartered in Canton, Massachusetts, and its stock is listed on the Nasdaq Global Market under the symbol "DXLG" [5].

Group 1 - Destination XL Group, Inc. has received a non-binding proposal from Fund 1 Investments, LLC to acquire all outstanding shares of the company [1] - The Board of Directors will review and evaluate the proposal along with other strategic alternatives with the assistance of financial and legal advisors [2] - Guggenheim Securities, LLC is serving as the financial advisor, while Greenberg Traurig, LLP is acting as the legal advisor for the company [2] Group 2 - Destination XL Group, Inc. is a leading retailer specializing in Big + Tall men's apparel, operating DXL Big + Tall and Casual Male XL retail and outlet stores across the United States [3] - The company also offers a multi-channel shopping experience through its e-commerce website DXL.COM and mobile app, providing a wide selection of products for Big + Tall men [3] - Destination XL Group, Inc. is headquartered in Canton, Massachusetts, and its common stock is listed on the Nasdaq Global Market under the symbol "DXLG" [3]

Group 1 - The core investment strategy focuses on long-only investment, evaluating companies from an operational and buy-and-hold perspective, rather than market-driven dynamics [1] - The articles emphasize understanding the long-term earnings power of companies and the competitive dynamics within their industries [1] - The majority of recommendations will be holds, indicating a cautious approach to investment opportunities [1] Group 2 - A very small fraction of companies are expected to be a buy at any given time, highlighting a selective investment strategy [1] - Hold articles are intended to provide valuable information for future investors and introduce skepticism in a generally bullish market [1]

Financial Performance - For the three months ended November 2, 2024, sales decreased to $107.5 million, down from $119.2 million in the prior quarter, representing a decline of 9.4%[82] - Comparable sales decreased by 11.3%, with store sales down 9.9% and direct business sales down 14.7%[82] - Total sales for Q3 fiscal 2024 were $107.5 million, down 10.4% from $119.2 million in Q3 fiscal 2023, primarily due to an 11.3% decrease in comparable sales[86] - Net loss for Q3 fiscal 2024 was $1.8 million, or $(0.03) per diluted share, compared to net income of $4.0 million, or $0.06 per diluted share, in Q3 fiscal 2023[93] Margins and Expenses - Gross margin as a percentage of sales was 45.1%, down from 47.5% in the previous quarter[82] - Gross margin rate for Q3 fiscal 2024 was 45.1%, a decrease of 240 basis points from 47.5% in Q3 fiscal 2023, driven by increased occupancy costs[87] - SG&A expenses as a percentage of sales increased to 44.1%, compared to 40.2% in the prior quarter[82] - SG&A expenses as a percentage of sales increased to 44.1% in Q3 fiscal 2024 from 40.2% in Q3 fiscal 2023, despite a dollar decrease of $0.6 million[88] Cash and Investments - Cash and investments as of November 2, 2024, were $43.0 million, down from $60.4 million at October 28, 2023, with no debt outstanding[82] - Cash flow from operations for the first nine months of fiscal 2024 was $12.5 million, down from $33.1 million in the same period of fiscal 2023[97] - The Company had no outstanding borrowings under the Credit Facility at November 2, 2024, and no borrowings during the first nine months of fiscal 2024[103] Inventory Management - Inventory levels decreased by 10.7% compared to October 28, 2023[82] - Inventory decreased by approximately $10.7 million to $89.1 million as of November 2, 2024, with clearance inventory at 9.2% of total inventory[95] Store Openings and Expansion Plans - The company has paused its brand campaign for Q4 fiscal 2024 and reduced the planned number of new store openings in fiscal 2025 due to continued sales pressure[83] - Four new stores were opened in the first nine months of fiscal 2024, with plans for four more[83] - The company plans to open 8 new stores in fiscal 2025, down from a previous expectation of 10[84] - The Company opened four new DXL stores and converted four Casual Male XL stores to the DXL format during the first nine months of fiscal 2024, expecting to open four additional DXL stores by the end of fiscal 2024[105] - The Company plans to potentially open approximately 50 net new DXL stores over the next five years, representing a 15% increase in total square footage[105] Stock Repurchase and Credit Facilities - A $15.0 million stock repurchase program was approved, with $10.2 million utilized to repurchase 3.6 million shares during Q3 fiscal 2024[82] - A new stock repurchase program was approved, allowing the company to repurchase up to $15.0 million of its common stock[101] - The Company has a $125.0 million revolving credit agreement with Citizens Bank, with a maturity date of October 28, 2026[102] - As of November 2, 2024, the average unused excess availability was approximately $72.9 million, with unused excess availability at $78.1 million[103] - Outstanding standby letters of credit were $4.2 million and documentary letters of credit were $0.3 million as of November 2, 2024[103] - The Company is subject to an unused line fee of 0.25% on the Credit Facility[102] Marketing and Consumer Engagement - The company is focusing on traditional marketing channels, including a video campaign on social media platforms, after positive results from a brand advertising campaign test[83] - The new eCommerce platform is fully operational, with 100% of site traffic migrated, aiming to enhance consumer experience and operational agility[84] Capital Expenditures - Capital expenditures for fiscal 2024 are expected to range from $21.0 million to $24.0 million, net of tenant incentives[105] - Free cash flow before capital expenditures for store development was $2.5 million for the nine months ended October 28, 2023[110] - Adjusted EBITDA for the nine months ended November 2, 2024, was $15.7 million, with an adjusted EBITDA margin of 44.2%[110]

Financial Data and Key Metrics - Net sales for Q3 2024 were $107.5 million, down from $119.2 million in Q3 2023, primarily due to an 11.3% decrease in comparable sales [58][59] - Comparable sales declined 11.3% for the quarter, with stores down 9.9% and direct sales down 14.7% [15] - Gross margin for Q3 was 45.1%, down 240 basis points from 47.5% in Q3 2023, largely due to increased store occupancy costs [63][65] - Adjusted EBITDA for Q3 was 1% of sales, compared to 7.3% in Q3 2023, with full-year adjusted EBITDA margin expected to be around 4.5% [71] Business Line Performance - Sportswear accounted for approximately 76% of sales, tailored clothing 20%, and footwear 4% [25] - Sales mix shifted towards private label and lower-priced brands, with private brands gaining over a full percentage point in sales mix [24] - New stores opened in Q3 included locations in Phoenix and Houston, bringing the total to seven new stores since the beginning of 2023, with four more planned by year-end [26][27] Market Performance - Sales in November continued to show low to mid-teens negative comps, reflecting ongoing softness in big and tall consumer demand [14] - The company observed a shift in consumer behavior towards lower-priced goods and promotions, with customers gravitating towards entry-level and private brands [11][12] - Despite the challenging environment, the company believes it is gaining share of wallet from other big and tall retailers [13] Strategic Direction and Industry Competition - The company is focusing on long-term strategic initiatives, including a new loyalty program, a revamped e-commerce platform, and customer segmentation to drive growth [32][39][43] - A new price match guarantee was introduced to remain competitive with national brands offering richer discounts [25] - The company is monitoring the impact of GLP-1 weight loss drugs on its customer base, with no significant impact observed yet [54][57] Management Commentary on Operating Environment and Outlook - Management acknowledged ongoing macroeconomic challenges, with consumers holding tight to their wallets and prioritizing value-driven purchases [10][60] - The company expects Q4 comp sales to improve to mid-single-digit declines, driven by better year-over-year comparisons and strategic promotions [61][87] - Management remains optimistic about future growth, citing new initiatives, a new e-commerce platform, and potential improvements in consumer sentiment [30][31] Other Key Information - Inventory levels at the end of Q3 were $89.1 million, down 10.7% from $99.9 million in Q3 2023, reflecting disciplined inventory management [21][64] - The company repurchased 3.6 million shares for $10.2 million in Q3, with $4.8 million remaining under its share repurchase program [77] - Free cash flow before store development costs was $2.5 million year-to-date, with a focus on balancing long-term returns and short-term fiscal responsibility [78] Q&A Session Summary Question: Implied Q4 guidance and promotional strategy - The company expects Q4 comp sales to improve to mid-single-digit declines, driven by better year-over-year comparisons and strategic promotions [86][87] - Promotions are largely baked into guidance, with some flexibility for unplanned opportunities like weather-driven sales [89][90] Question: Competitive dynamics with national brands - The company introduced a price match guarantee to remain competitive with national brands offering richer discounts [90][91] - Relationships with national brands vary, with some offering vendor allowances or guaranteed margins, while others are promoting heavily to move inventory [90] Question: Market share and competitive positioning - The company believes it is gaining share of wallet from other big and tall retailers, based on aggregated anonymous data and credit card information [92][93] - The company's assortment is focused on moderate to upper-moderate price points, with limited direct competition from lower-end retailers [93] Question: Product margins and assortment strategy - Lower-priced private brands have higher margins, making the shift towards these products beneficial for profitability [99] - The company plans to introduce new national brands in spring 2025 to address lower price points while maintaining its core assortment [99] Question: Brand awareness and advertising results - Brand awareness metrics showed modest improvements in Q2, but the company has pulled back on national brand campaigns due to challenging ROAS [100] - A new video campaign will be launched on streaming platforms to drive awareness, with hopes of going viral [100] Question: SG&A and store hours - SG&A expenses decreased by $600,000 in Q3, primarily due to reduced advertising costs [68] - Store hours will see minimal extensions during the holiday season, as extended hours have not shown significant incremental sales [103]

Financial Performance - Total sales for Q3 fiscal 2024 were $107.5 million, down 9.8% from $119.2 million in Q3 fiscal 2023, with comparable sales decreasing by 11.3%[3] - Net loss for Q3 fiscal 2024 was $(1.8) million, or $(0.03) per diluted share, compared to net income of $4.0 million, or $0.06 per diluted share in Q3 fiscal 2023[13] - Adjusted EBITDA for Q3 fiscal 2024 was $1.0 million, or 1.0% of sales, down from $8.6 million, or 7.3% of sales in Q3 fiscal 2023[4] - Gross profit for the three months ended November 2, 2024, was $48.4 million, down from $56.6 million in the same period last year[36] - The company reported a net loss of $1.8 million for the three months ended November 2, 2024, compared to a net income of $4.0 million in the same period last year[36] - The projected net income (GAAP basis) for Fiscal 2024 is $5.6 million, equating to $0.09 per diluted share[47] Cash and Investments - Cash and investments totaled $43.0 million as of November 2, 2024, down from $60.4 million as of October 28, 2023, with no outstanding debt[16] - Cash and cash equivalents decreased to $7.1 million as of November 2, 2024, down from $10.7 million as of October 28, 2023[40] - Free Cash Flow (non-GAAP basis) for the nine months ended October 28, 2023, was $22.7 million, after capital expenditures for store development of $3.8 million[44] - Cash flow from operating activities (GAAP basis) for the nine months ended October 28, 2023, was $33.1 million[44] Sales and Guidance - The company revised its full-year sales guidance for fiscal 2024 to approximately $470.0 million, reflecting a comparable sales decrease of about 10%[21] - The projected sales for Fiscal 2024 (low-end of guidance) is $470.0 million[47] - For Q3 fiscal 2024, direct sales were $31.3 million, representing 29.1% of retail segment sales, down from $36.2 million or 30.4% in Q3 fiscal 2023[20] Expenses and Margins - SG&A expenses as a percentage of sales increased to 44.1% in Q3 fiscal 2024 from 40.2% in Q3 fiscal 2023, despite a dollar decrease of $0.6 million[11] - Gross margin rate for Q3 fiscal 2024 was 45.1%, down 240 basis points from 47.5% in Q3 fiscal 2023, primarily due to increased occupancy costs[9] - Adjusted EBITDA guidance was lowered to 4.5% from 6.0% due to cost deleveraging on a lower sales base[21] - The adjusted EBITDA margin as a percentage of sales for Fiscal 2024 is projected to be 4.5%[47] Store Openings and Strategic Initiatives - The company opened two new stores in Q3 fiscal 2024, bringing the total to four new stores year-to-date, with plans for four additional openings in Q4[7] - The company expects to open eight new stores in fiscal 2025, down from a previous expectation of ten[7] - The company plans to continue its strategic initiatives to enhance brand awareness and improve its eCommerce platform[30] - The new eCommerce platform is fully operational, with 100% of site traffic on the new platform, enhancing user experience and speed[7] Liabilities and Equity - Total liabilities and stockholders' equity as of November 2, 2024, was $381.3 million, an increase from $372.7 million as of October 28, 2023[39] - Inventories increased to $89.1 million as of November 2, 2024, compared to $99.9 million as of October 28, 2023[40] Other Financial Metrics - The company reported a loss on termination of retirement plans of $0.1 million for the three months ended October 28, 2023[42] - Adjusted EBITDA (non-GAAP basis) for the three months ended October 28, 2023, was $8.6 million, and for the nine months ended October 28, 2023, it was $44.2 million[42] - The adjusted EBITDA margin as a percentage of sales for the nine months ended October 28, 2023, was 11.5%[42]

CANTON, Mass., Nov. 22, 2024 (GLOBE NEWSWIRE) -- Destination XL Group, Inc. (NASDAQ: DXLG), the leading integrated-commerce specialty retailer of Big + Tall men's clothing and shoes, today reported operating results for the third quarter of fiscal 2024, and updated sales and earnings guidance for the fiscal year. Third Quarter Financial Highlights Total sales for the third quarter were $107.5 million, down 9.8% from $119.2 million in the third quarter of fiscal 2023. Comparable sales for the third quarter o ...

CANTON, Mass., Oct. 25, 2024 (GLOBE NEWSWIRE) -- Destination XL Group, Inc. (NASDAQ: DXLG), the leading integrated commerce retailer of Big + Tall men's clothing and shoes, announced today it will release its third quarter of fiscal 2024 financial results before the market opens on Friday, November 22, 2024. President and Chief Executive Officer Harvey Kanter and Executive Vice President, Chief Financial Officer, and Treasurer Peter Stratton will host a conference call the same morning at 9:00 a.m. ET to di ...

Press Release Atos selected by the European Space Agency (ESA) to expand the capabilities of the Destination Earth (DestinE) services platform Funded by the European Commission, the DestinE initiative powers a platform harnessing extensive climate data using a digital model of Earth Paris, France – September 25, 2024 – Atos today announces that it has been selected by the European Space Agency (ESA) to lead a consortium tasked with an initial 12-month mission to expand the capabilities of the Destination Ea ...