Destination XL Group, Inc., the largest multi-channel specialty retailer of big & tall men's apparel and accessories, reported operating results for the first quarter of fiscal 2014.
First-Quarter Fiscal 2014 Highlights
Total sales increased 3.0% to $96.8 million compared with $94.0 million in the first quarter of fiscal 2013, of which $36.2 million were from DXL stores compared with $17.0 million in the first quarter of fiscal 2013. Total comparable sales increased 3.4%.
52 DXL stores, opened at least 13 months, had a 12.8% comparable sales increase. DXL brand awareness increased from 13% in Spring 2013 to 30% in Spring 2014. Company reaffirms guidance of $(0.12) to $(0.16) per diluted share, on a non-GAAP basis, for fiscal 2014.
The Company opened 7 new DXL stores and closed 10 Casual Male XL stores, bringing the total DXL store count to 106 as of May 3, 2014.
First-Quarter Fiscal 2014 Results
For the first quarter of fiscal 2014, total sales were $96.8 million compared with $94.0 million in the first quarter of fiscal 2013. The increase of $2.8 million in total sales was primarily due to an increase in comparable sales of $2.5 million, or 3.4%. Through the end of fiscal 2013, the Company's definition of comparable sales included DXL stores compared with the sales of predecessor Casual Male XL stores.
This was done to provide a metric as to how the Company's DXL stores were performing in comparison to its Casual Male XL legacy stores. Beginning in the first quarter of fiscal 2014, the Company returned to a more traditional calculation of comparable sales and only stores open at least 13 months are included in the calculation of comparable store sales.
Gross Profit Margin
For the first quarter of fiscal 2014, gross margin, inclusive of occupancy costs, was 45.4% as compared to a gross margin rate of 47.2% for the first quarter of fiscal 2013. The decrease of 180 basis points for the first quarter of fiscal 2014 was the result of an increase in occupancy costs of 20 basis points and a decrease in merchandise margins of 160 basis points. The decrease in merchandise margin for the first quarter of fiscal 2014 was higher due to increased in-store promotions, customer acquisition initiatives, and increased penetration of clearance merchandise.