Thu, Aug 29, 5:58 PM (324 days ago)
Destination XL Group, Inc. reported a challenging second quarter for fiscal 2024, ending August 3, 2024, with total sales of $124.8 million, reflecting a 10.9% decline compared to $140.0 million in the previous year. Comparable sales decreased 11.1%, attributed to reduced foot traffic and lower conversion rates in direct sales. Gross profit margins fell to 48.2%, down from 50.3%, primarily due to increased occupancy costs. Net income dropped significantly to $2.4 million ($0.04 per diluted share) from $11.6 million ($0.18) in the prior year. Despite these challenges, the company maintained a strong balance sheet with cash and investments totaling $63.2 million and no outstanding debt. Inventory levels decreased by 10.2%, indicating effective inventory management. SG&A expenses rose to 43.0% of sales, driven by increased marketing costs. The company is pivoting its strategy to focus on immediate traffic stimulation and has decided to slow new store openings. Future growth initiatives include enhancing eCommerce capabilities and exploring collaborations to expand market reach. Overall, while facing headwinds, Destination XL remains focused on liquidity and operational efficiency amidst a volatile retail environment.