The adjusted EBITDA increased $1.5 million, at 9.1 per cent of net sales. Cash and cash equivalents of $5.7 million with net liquidity of $73.3 million. Inventory down $20.7 million or 12.2 per cent.
Duluth Holdings Inc has reported net income of $1.3 million in Q2 FY25, or $0.04 per share, with adjusted EPS of $0.03.
Net sales fell 7 per cent to $131.7 million as DTC sales declined 13.7 per cent, partly offset by a 5.3 per cent rise in retail store sales.
The gross margin improved to 54.7 per cent, SG&A fell 7.1 per cent, and guidance for FY25 was maintained.
The net sales decreased $9.9 million, or 7 per cent, to $131.7 million, compared to $141.6 million in Q3 FY24. Direct-to-consumer (DTC) net sales decreased by 13.7 per cent to $79.1 million due to lower traffic, partially offset by higher average order values. Retail store net sales increased by 5.3 per cent to $52.6 million primarily driven by higher average order values, Duluth said in a press release.
The gross margin increased to 54.7 per cent of net sales in the three months ended August 3, 2025, compared to 52.3 per cent of net sales in the three months ended July 28, 2024. The increase in gross margin rate was primarily driven by an increase in average unit retail sales from reduced promotional activity coupled with an improvement in product costs from our direct to factory sourcing initiative.
Selling, general and administrative (SG&A) expenses decreased $5.2 million, or 7.1 per cent, to $68.8 million.
The selling, general and administrative (SG&A) expenses as a percentage of net sales decreased to 52.2 per cent. The decrease in selling, general and administrative expense as a percentage of net sales was mainly driven by leverage on outbound shipping costs due to higher average order values coupled with a reduction in personnel and depreciation expenses, added the release.
The company in its statement said that it is maintaining its previously issued fiscal 2025 financial guidance.
“We are encouraged by our second-quarter results, reflecting positive momentum in our turnaround efforts. Our team made notable improvements in the business including promotional reset, expense management, and inventory discipline. These efforts led to enhanced gross margin, reduced SG&A, and lower inventory levels,” said Stephanie Pugliese, president and CEO of Duluth.
“While pleased with our Q2 results, we acknowledge the significant work ahead. I am dedicated to leveraging our foundational work in product sourcing, optimizing our fulfilment centre network, and rationalizing our store portfolio. As we approach our peak selling season, our focus remains on simplifying the business, reducing expenses, mitigating tariff impacts, and delivering on our promise to consumers with excellence,” added Pugliese.
Fibre2Fashion News Desk (SG)
