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Destination XL Q2 comparable sales increase 3.3 percent

By Prachi Singh

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Business

Total sales for the second quarter of fiscal 2018 at Destination XL increased 0.9 percent to 122.2 million dollars. The company said, increase of 1.1 million dollars in total sales was due to a comparable sales increase of 3.3 percent or 3.8 million dollars and an increase of 2 million dollars in non-comparable sales from DXL stores open less than 13 months partially offset by closed stores of 2.3 million dollars and a 1.9 million dollars shift in calendar weeks due to the 53rd week in fiscal 2017.

“We are pleased to report our third consecutive quarter of positive comparable sales growth with a second quarter increase of 3.3 percent. This was another quarter of successful execution against our strategic initiatives and we are well positioned for continued progress in the second half,” said David Levin, President and Chief Executive Officer in a statement.

DXL eliminates 56 staff positions to drive profitability

In May 2018, the company added that it executed a corporate restructuring to accelerate the company's path to profitability by better aligning its expense structure with its revenues. The Company eliminated 56 positions, which represented approximately 15 percent of its corporate work force or 2 percent of the total work force. Of the 56 positions, 36 positions were terminations and 20 positions were open positions that will not be filled.

As a result of this restructuring, the company expects to realize savings of approximately 5.6 million dollars in SG&A expenses in fiscal 2018, which is reflected in our earnings guidance. For the second quarter the company’s net loss was 1.2 million dollars or 0.02 dollar per diluted share, compared with 3.7 million dollars or 0.08 dollar per diluted share, for the second quarter of fiscal 2017. Adjusted net income per share, assuming a normalized tax rate of 26 percent, was 0.01 dollar per diluted share, as compared to 0.03 dollar per diluted share for the second quarter 2017.

Adjusted EBITDA was 8.8 million dollars compared to 6.7 million dollars for the second quarter of fiscal 2017. Gross margin rate, inclusive of occupancy costs, was 46.3 percent as compared to 46.1 percent for the second quarter of fiscal 2017. The 20 basis point improvement was due to a 30 basis point decrease in occupancy costs as a percent of sales partially offset by a 10 basis point decrease in merchandise margins.

DXL expects FY18 comparable sales to rise between 1 to 3 percent

For fiscal 2018, based on a 52-week year, the company expects sales of 462 million dollars to 472 million dollars, with a total company comparable sales increase of approximately 1percent to 3 percent, gross margin rate of approximately 44.5 percent, net loss, on a GAAP basis, of 13.2 to 18.2 million dollars or 0.27 dollar to 0.37 dollar per diluted share and adjusted net loss of 0.11 dollar to 0.18 dollar per diluted share.

Picture:Facebook DXL men's apparel

Destination XL