Destination XL Group Inc. made top-line progress in the second quarter while its bottom line fell more deeply into the red.
The Canton, Mass.-based big and tall men’s wear retailer’s net loss for the three months ended Aug. 2 was $4 million, or 8 cents a diluted share, versus a loss of $1.6 million, or 3 cents, in the 2013 period. Excluding extraordinary items, the loss was 5 cents a diluted share, 1 cent below the consensus estimate for a 4-cent loss.
Sales in the period hit $103.7 million, 5.8 percent above the $98 million registered during last year’s quarter but below the $104.4 million anticipated, on average, by analysts.
Comparable sales in the quarter rose 7 percent, with its expanded DXL stores up 11.3 percent and the Casual Male and Rochester stores ahead 7.1 percent for an 8.5 percent same-store sales increase. The direct business rose 0.5 percent in the quarter.
Gross margin dipped to 45.7 percent of sales from 46.1 percent in the year-ago period.
“The solid performance of our DXL stores was driven by increased traffic and higher conversion rates,” said David Levin, president and chief executive officer. “We are seeing growth in the total number of our active customers and our sales penetration into the smaller waist-size customer is improving.”
Sales per square foot in the DXL stores rose to a range of $160 to $165 from $147 last year.
The firm provided full-year guidance that conformed to the expectations of Wall Street. Total sales are expected to finish between $413 million and $418 million, bracketing the consensus estimate of $414.7 million, and the adjusted loss per share is projected to be between 12 and 16 cents, again bracketing the Wall Street view for a loss of 14 cents.
The company said it was in the process of winding down its direct business with Sears Canada, a process it expects to complete before the end of the fiscal year.
Year-to-date, the firm’s net loss expanded to $7.6 million, or 16 cents a diluted share, from a loss of $576,000, or 1 cent, in the first half of last year. Sales rose 4.4 percent to $200.5 million from $192 million.