The holidays were not kind to Destination XL Group, Inc..
The Massachusetts-based big & tall men’s apparel retailer, said total sales for the nine-week holiday sales period ending Dec. 31, 2016 decreased to $97.9 million, compared with $98.2 million for the same period of the prior year. Additionally, comparable-store sales for the period fell 1.4 percent.
As a result, the retailer has updated guidance to the low-end of its previously announced full-year range.
“The retail apparel environment was challenging over the holiday selling season, but we were pleased with our store results on the East and West coasts,” said David Levin, president and chief executive officer. “We believe our strategic decision to eliminate a fall television advertising campaign, while increasing our digital advertising spend, impacted top-line performance across the country, but resulted in a better return on investment in the current environment.”
Levin said that during the November/December period, the company saw “a noticeable migration with our ‘gift-giver’ this season to online shopping.” As a result, he said the company’s direct business performed well, but it was “not enough to offset the decline in store sales. We are managing our expenses very well, which we expect will allow us to meet the low-end of our sales, EBITDA and earnings guidance for the year. Our inventory levels are in excellent shape and we believe we are well-positioned as we enter the spring selling season.”
In reporting third-quarter results in November, the company actually increased guidance, saying that it was expecting a net loss of $44 million to breakeven in fiscal 2016 on total sales of $451 million to $457 million. Comparable-store sales were projected to be up 1 to 2 percent. Earlier guidance had projected sales of $457 million to $463 million and a same-store sales gain of 2 to 4 percent.
The company will report its actual fourth-quarter and fiscal 2016 financial results on March 17.
Destination XL joins a slew of retailers indicating that the holiday selling season was tough for many brick-and-mortar focused companies. Kohl’s and J.C. Penney Co. Inc. both last week indicated that sales had failed to match earlier projections, while The Limited closed all of its physical stores.