Financial Performance - Net sales in fiscal 2024 decreased by $20.1 million, or 3.1%, to $626.6 million compared to $646.7 million in fiscal 2023[166] - Net loss in fiscal 2024 was ($43.6) million compared to a net loss of ($9.9) million in the prior year[153] - Adjusted EBITDA in fiscal 2024 decreased by $18.0 million to $14.6 million, representing 2.3% of net sales compared to 5.1% in fiscal 2023[176] - Gross profit decreased by $16.5 million, or 5.1%, to $308.5 million, with a gross margin of 49.2% in fiscal 2024 compared to 50.3% in fiscal 2023[168] - Selling, general and administrative expenses increased by $3.1 million, or 0.9%, to $337.6 million, representing 53.9% of net sales in fiscal 2024[169] - The decrease in net sales was primarily driven by lower average unit retail prices and processing delays at a legacy fulfillment center[166] - For the fiscal year ended February 2, 2025, Duluth Holdings Inc. reported a net loss of $43.6 million, compared to a net loss of $9.9 million for the previous fiscal year[240] - The operating loss for the fiscal year ended February 2, 2025, was $(36,861,000), compared to an operating loss of $(9,569,000) in the prior year[345] Cash Flow and Working Capital - Free cash flow decreased by $14.8 million to ($25.2) million in fiscal 2024 compared to ($10.4) million in fiscal 2023, primarily due to higher inventory levels[178] - Net cash used in operating activities was ($16.9) million for fiscal 2024, compared to $38.7 million provided in fiscal 2023[186] - As of February 2, 2025, working capital was $63.1 million, including cash and cash equivalents of $3.3 million[179] - The company expects cash flow from operating activities and credit availability to cover working capital and capital expenditure needs for the foreseeable future[181] Inventory and Assets - Inventory increased by $40.8 million in fiscal 2024, while trade accounts payable increased by $22.9 million[186] - Total current assets increased to $191,631 thousand as of February 2, 2025, compared to $180,974 thousand at the end of the previous fiscal year[229] - Inventory levels rose to $166,545 thousand, up from $125,757 thousand, suggesting potential overstock issues[229] - The inventory reserve for excess, obsolete items and shrinkage increased to $2.1 million as of February 2, 2025, from $1.4 million in the previous year[264] Expenses and Liabilities - Interest expense increased by $0.4 million to $4.6 million in fiscal 2024 due to higher interest rates on outstanding debt[171] - Income tax expense was $2.4 million in fiscal 2024 compared to an income tax benefit of $2.9 million in fiscal 2023[172] - Total liabilities increased slightly to $272,763 thousand from $271,460 thousand, indicating stable leverage[229] - Total accrued expenses and other current liabilities increased to $35.684 million as of February 2, 2025, from $34.111 million as of January 28, 2024[315] Capital Expenditures and Investments - Capital expenditures for fiscal 2024 were $17.4 million, with an expected increase to approximately $20.0 million in fiscal 2025[180] - Net cash used in investing activities was $8.1 million in fiscal 2024, down from $48.7 million in fiscal 2023[189] - The company has a credit facility with a revolving commitment of $100.0 million following amendments made in January 2025[194] Shareholder Equity and Stock - The company’s total shareholders' equity decreased to $179,679 thousand from $219,750 thousand, indicating a decline in net worth[229] - The weighted average shares of common stock outstanding increased to 33,368 thousand from 32,955 thousand, reflecting potential dilution[231] - Total stock compensation expense associated with restricted stock was $4.0 million for fiscal 2024, a decrease of 4.76% from $4.2 million in fiscal 2023[283] Tax and Valuation - Total income tax expense for the fiscal year ended February 2, 2025, was $2,370,000, compared to a tax benefit of $(2,862,000) for the previous year[330] - The company recognized a valuation allowance of $11.8 million against deferred tax assets as of February 2, 2025, due to cumulative losses over the past 36 months[332] Operational Metrics - Direct-to-consumer revenue for the fiscal year ended February 2, 2025, was $419.860 million, down from $425.562 million in the previous year[325] - Store revenue for the fiscal year ended February 2, 2025, was $206.769 million, a decline from $221.119 million in the prior year[327] - The company incurred advertising and catalog expenses of $67.5 million for fiscal 2024, down from $69.0 million in fiscal 2023, reflecting a decrease of approximately 2.2%[255] - Shipping and processing expenses were $43.7 million for fiscal 2024, compared to $47.2 million in fiscal 2023, indicating a reduction of about 9.4%[258]

Group 1 - Duluth Holdings (DLTH) has experienced significant selling pressure, resulting in a 26.3% decline over the past four weeks, but it is now considered to be in oversold territory with expectations of better earnings ahead [1] - The Relative Strength Index (RSI) is a key technical indicator used to identify oversold stocks, with a reading below 30 typically indicating oversold conditions [2] - The RSI reading for DLTH is currently at 29.58, suggesting that the heavy selling may be exhausting itself, indicating a potential bounce back towards equilibrium [5] Group 2 - There has been a strong consensus among sell-side analysts to raise earnings estimates for DLTH, with a 9.5% increase in the consensus EPS estimate over the last 30 days, which often correlates with price appreciation [6] - DLTH holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, indicating a strong potential for a turnaround [7]

Financial Data and Key Metrics Changes - The fourth quarter results fell short of expectations due to processing delays at the legacy fulfillment center [3] - The company finished the quarter with $103 million in liquidity and no debt, indicating a strong financial position despite challenges [4] Business Line Data and Key Metrics Changes - Promotional adjustments after Cyber Monday reduced top line revenue while limiting gross margin pressure [4] Market Data and Key Metrics Changes - Specific market data and metrics were not disclosed in the provided content Company Strategy and Development Direction and Industry Competition - The company is focused on the "Big Dan Blueprint" initiatives, which are strategic efforts designed to transform the business and unlock growth and profit potential [3] Management's Comments on Operating Environment and Future Outlook - Management acknowledged significant challenges in fulfilling orders and emphasized the need for immediate corrective actions [3] - The fourth quarter results did not meet expectations, but the company is optimistic about the foundational progress made in 2024 [3] Other Important Information - Sam Sato, the President and CEO, is retiring, and his contributions to the company were acknowledged by the Board of Directors [5] Summary of Q&A Session Questions and Answers - There was no Q&A session following the presentation, as noted in the conference call introduction [1]

Financial Data and Key Metrics Changes - Net sales for Q4 2024 declined 1.8% to $241 million, with direct channel sales flat and retail store sales down 6.9% due to decreased traffic [7][36] - Adjusted EBITDA for Q4 was approximately $8.5 million, with a reported EPS loss of $0.17 and adjusted EPS loss of $0.04 [36][40] - Full year 2024 net sales were $626.6 million, down 3.1% compared to the prior year, with an adjusted net loss of $23.6 million [44][46] Business Line Data and Key Metrics Changes - Direct channel sales remained flat, while retail sales decreased due to lower foot traffic and average order value (AOV) [37] - Mobile sales grew 4% year-over-year, accounting for nearly 70% of site visits and 58% of digital sales [15][37] Market Data and Key Metrics Changes - The company experienced a gross margin contraction of 410 basis points in Q4, driven by an AUR decline of 8.9% [38] - Full year gross margin ended at 49.2%, down 110 basis points, primarily due to deeper promotions to reduce excess inventory [44] Company Strategy and Development Direction - The company is focused on a transformation strategy called the Big Dam Blueprint, aimed at unlocking growth and profit potential [6][12] - Strategic initiatives include direct-to-factory sourcing, enhancing logistics and fulfillment capabilities, and revitalizing the retail store portfolio [12][18] - The omnichannel strategy is crucial, with plans to enhance mobile experiences and open new stores in priority markets [16][18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in fulfilling orders and emphasized the importance of improving logistics and inventory management [6][30] - The outlook for fiscal 2025 projects net sales between $570 million and $595 million, with anticipated gross margin expansion of approximately 300 basis points [47][48] Other Important Information - The company ended 2024 with no debt and $103 million in liquidity, providing flexibility for operations [30][43] - A leadership transition is underway, with the current CEO announcing retirement effective April 25, 2025, and the Chairman taking over day-to-day operations [32][55] Summary of Q&A Session Questions and Answers - There was no question-and-answer session following the presentation, as noted in the call introduction [1]

Financial Performance - Net sales for the fourth quarter decreased by 1.8% to $241.3 million compared to $245.6 million in the prior year[5] - The company reported a net loss of $5.6 million for the fourth quarter, compared to a net income of $6.8 million in the prior year[5] - Adjusted EBITDA for the fourth quarter was $8.5 million, down from $20.9 million in the prior year[5] - For the full fiscal year, net sales were $626.6 million, a decrease from $646.7 million in the prior year[5] - The company experienced a net loss of $43.6 million for the full fiscal year, compared to a net loss of $9.9 million in the prior year[5] - Adjusted EBITDA for the fiscal year ended February 2, 2025, was $14.62 million, down from $32.67 million in the previous fiscal year[36] - The company forecasts a net loss between $26.80 million and $21.50 million for the fiscal year ending February 1, 2026[43] - Free cash flow for the fiscal year ended February 2, 2025, was $(25.25) million, compared to $(10.41) million in the previous year[38] Sales Breakdown - Direct-to-consumer net sales increased by 0.4% to $172.9 million in the fourth quarter, while retail store net sales decreased by 6.9% to $68.4 million[9] - Net sales for the three months ended February 2, 2025, were $241.27 million, a decrease of 1.4% from $245.61 million for the same period last year[32] Profitability Metrics - The gross profit margin decreased to 44.1% of net sales, down from 48.2% in the prior year, primarily due to increased discounting[10] - Gross profit for the fiscal year ended February 2, 2025, was $308.51 million, down 5.1% from $324.97 million in the previous fiscal year[32] Liquidity and Debt - The company ended the quarter with a liquidity of $103.3 million and no debt on the credit facility[1] - Cash and cash equivalents at the end of the period were $3.34 million, a significant decrease from $32.16 million at the beginning of the period[34] - Total assets decreased to $452.44 million as of February 2, 2025, from $491.21 million as of January 28, 2024[29] - Total current liabilities increased to $128.55 million as of February 2, 2025, compared to $105.63 million in the previous year[29] Strategic Initiatives - The company plans to expand its Duluth Women's Heirloom and Garden collection and introduce new products featuring Armachillo cooling technology[7] Future Outlook - Fiscal 2025 outlook includes net sales projected in the range of $570 million to $595 million and adjusted EBITDA in the range of $20 million to $25 million[18] - The company incurred restructuring expenses of $7.75 million during the fiscal year ended February 2, 2025[32]

Leadership Transition - Samuel M. Sato plans to retire as President and CEO of Duluth Trading effective April 25, 2025, and will also step down from the Board [2] - Stephen L. Schlecht, the Chairman of the Board and founder, will assume day-to-day leadership during the transition period with Mr. Sato's assistance [2][3] - The Board of Directors is conducting a search for a new CEO to replace Mr. Sato [2] Company Commitment - Mr. Schlecht expressed a deep commitment to the ongoing success of Duluth Trading and aims to ensure continuity in vision and strategy execution during the leadership transition [3] - The company has a talented senior leadership team that is committed to maintaining business operations without disruption [3] Company Overview - Duluth Trading is a lifestyle brand offering high-quality workwear, casual wear, and outdoor apparel for men and women [4] - The company emphasizes customer engagement through humor and storytelling in its marketing, and it operates through a content-rich website, catalogs, and unique retail locations [4] - Duluth Trading is dedicated to outstanding customer service, backed by its "No Bull Guarantee" [4]

Core Insights - Duluth Holdings Inc. reported net sales of $241.3 million for the fourth quarter and $626.6 million for the full fiscal year, reflecting a decrease from the previous year [1][6] - The company experienced a net loss of $5.6 million in the fourth quarter and $43.6 million for the full fiscal year, compared to a net income of $6.8 million in the prior-year fourth quarter [6][10] - Duluth Trading ended the quarter with liquidity of $103.3 million and no debt on its credit facility [1] Financial Performance - Fourth quarter net sales decreased by 1.8% to $241.3 million from $245.6 million in the same period last year [10] - Direct-to-consumer net sales increased by 0.4% to $172.9 million, while retail store net sales decreased by 6.9% to $68.4 million [10] - Gross profit for the fourth quarter decreased by 10.1% to $106.5 million, representing 44.1% of net sales, down from 48.2% in the prior year [11] - Selling, general and administrative expenses increased by 1.5% to $110.7 million, with a notable increase in expenses as a percentage of net sales [12] Adjusted Metrics - Adjusted net loss for the fourth quarter was $1.5 million, excluding software impairment and deferred tax asset valuation allowance [6] - Adjusted EBITDA for the fourth quarter was $8.5 million, down from $20.9 million in the prior year [6] - For the full fiscal year, adjusted net loss was $23.6 million, with adjusted EBITDA of $14.6 million, reflecting 2.3% of net sales [6] Inventory and Operational Strategy - Total inventory increased compared to last year, but a higher unit velocity during peak sales periods helped reduce seasonal and clearance inventory [7] - The company plans to expand its product offerings, including new collections and collaborations, to enhance its market presence [8][9] Future Outlook - Duluth Trading provided a fiscal 2025 outlook with projected net sales in the range of $570 million to $595 million and adjusted EBITDA between $20 million and $25 million [20] - The company aims to focus on strategic initiatives and operational improvements to enhance performance in the upcoming year [9]

Company Overview - Duluth Holdings Inc. operates under the brand name Duluth Trading Company, focusing on lifestyle apparel for men and women, including casual wear, workwear, and accessories [1][2] - The company is based in Mount Horeb, Wisconsin, and targets the modern, self-reliant American consumer [2] Financial Reporting - Duluth Trading will report its fourth quarter 2024 financial results on March 13, 2025, before the market opens [1] - A conference call and audio webcast for analysts and investors will take place on the same day at 9:30 am Eastern Time to discuss the results [1] Conference Call Details - The live conference call can be accessed domestically at 1-844-875-6915 and internationally at 1-412-317-6711 [2] - A replay of the conference call will be available until March 20, 2025, with domestic access at 1-877-344-7529 and international access at 1-412-317-0088 [2] - Investors can pre-register for the call to expedite entry and receive a personalized phone number and pin [3]

Financial Performance - Net sales decreased by 8.1% year-over-year in Q3 fiscal 2024 to $127.1 million, and decreased by 3.9% to $385.4 million for the first nine months of fiscal 2024 [108]. - Net loss for Q3 fiscal 2024 was $28.5 million, compared to a net loss of $10.5 million in Q3 fiscal 2023, with a total net loss of $40.1 million for the first nine months of fiscal 2024 compared to $16.4 million in the same period last year [108]. - Adjusted EBITDA for Q3 fiscal 2024 decreased to ($6.8) million from ($1.6) million in Q3 fiscal 2023, and for the first nine months of fiscal 2024, it decreased to $5.7 million from $12.3 million [108]. - The operating loss for Q3 fiscal 2024 was $22.6 million, compared to an operating loss of $12.4 million in Q3 fiscal 2023, with a total operating loss of $35.4 million for the first nine months of fiscal 2024 compared to $18.4 million in the same period last year [118]. - Net loss attributable to controlling interest was $28.5 million for the three months ended October 27, 2024, compared to a net loss of $10.5 million for the same period in 2023 [126]. - For the nine months ended October 27, 2024, net sales decreased by $15.7 million, or 3.9%, to $385.4 million compared to $401.1 million for the same period in 2023 [128]. - Net loss attributable to controlling interest for the nine months ended October 27, 2024, was $40.2 million, compared to a net loss of $16.3 million for the same period in 2023 [136]. Expenses and Costs - Selling, general and administrative expenses increased to $82.9 million in Q3 fiscal 2024 from $81.8 million in Q3 fiscal 2023, and totaled $229.7 million for the first nine months of fiscal 2024 compared to $225.0 million in the prior year [118]. - Selling, general and administrative expenses increased by $1.0 million, or 1.2%, to $82.9 million, with expenses as a percentage of net sales rising to 65.2% from 59.2% [123]. - Restructuring expenses amounted to $6.2 million in Q3 fiscal 2024, indicating ongoing adjustments within the company [118]. - Income tax expense was $4.7 million for the three months ended October 27, 2024, compared to an income tax benefit of $3.1 million for the same period in 2023 [125]. Cash Flow and Investments - Net cash used in operating activities was $58.1 million for the nine months ended October 27, 2024, primarily due to a $105.7 million increase in inventory [146]. - Net cash used in investing activities for the nine months ended October 27, 2024, was $5.7 million, a decrease from $39.8 million for the same period in 2023 [149]. - Net cash used in financing activities for the nine months ended October 27, 2024, was $41.0 million, compared to $33.5 million in the prior year [150]. - The company expects to spend approximately $23.0 million on capital expenditures in fiscal 2024, focusing on logistics optimization and information technology [141]. Market and Operational Context - The macroeconomic environment is characterized by inflation and recessionary concerns, impacting store traffic and consumer demand [111]. - The company anticipates challenges in maintaining inventory levels and adapting to changing consumer preferences amid economic uncertainties [111]. - The company operated 62 retail stores and three outlet stores as of October 27, 2024, reflecting its ongoing expansion strategy [105]. - The company continues to focus on innovative product offerings, including Longtail T shirts and Buck Naked underwear, to enhance brand appeal and customer loyalty [106]. Accounting and Compliance - There have been no significant changes to contractual obligations as described in the Annual Report on Form 10-K for the fiscal year ended January 28, 2024 [151]. - The company is not a party to any material off-balance sheet arrangements [152]. - There have been no significant changes in critical accounting policies and estimates as described in the 2023 Form 10-K [154]. - There have been no significant changes in market risks as described in the 2023 Form 10-K [156].

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, with only a small fraction of companies deemed suitable for buying at any given time [1] Group 2 - The articles aim to provide important information for future investors and introduce a healthy skepticism towards a generally bullish market [1] - There is a clear distinction made between the author's opinions and professional investment advice, highlighting the need for readers to conduct their own due diligence [2][3]