Duluth says its efforts to focus on core products are beginning to improve profitability, even as sales remained under pressure in the first quarter.
The workwear and outdoor apparel brand reported a net loss of $10 million for the quarter ended May 3, an improvement from a loss of $15.3 million a year earlier.
Net sales fell 4 per cent to $98.6 million, while adjusted EBITDA (earnings before interest, taxes, depreciation and amortisation) increased by $6.4 million to $2.6 million.
Duluth also reduced inventory by 24.8 per cent year-over-year, a move president and CEO Stephanie Pugliese said strengthened the company’s liquidity.
“These efforts led to enhanced gross margin, reduced inventory, improved profitability, and stronger liquidity,” Pugliese said.
Direct-to-consumer sales declined 8.7 per cent to $57.1 million, which Duluth attributed to lower website traffic and weaker conversion rates following a pullback in promotional activity.
Retail store sales increased 3.3 per cent to $41.5 million, supported by higher average transaction values at comparable stores and contributions from two stores opened in the third quarter of last year.
“As we look ahead, our focus remains on delivering the core, high-quality, solution-based products that resonate most with our customers and creating an exceptional experience,” Pugliese concluded.
Duluth Trading is a casual wear and workwear apparel brand founded in 1989 in Duluth, Minnesota. Known for its durable, solution-oriented gear and humorous advertising, the retailer operates more than 60 store and outlet locations across the US alongside its e-commerce platform.
