Duluth Holdings Inc. (NASDAQ: DLTH) reported Q2 EPS of $0.20, $0.06 better than the analyst estimate of $0.14. Revenue for the quarter came in at $110.7 million versus the consensus estimate of $106.56 million.

• Net sales increased 28.3% to $110.7 million compared to $86.2 million in the prior-year second quarter
• Gross margin decreased 50 basis points to 56.2% compared to 56.7% in the prior-year second quarter
• Operating income increased 33.9% to $9.9 million compared to operating income of $7.4 million in the prior-year second quarter
• Net income increased 48.9% to $6.4 million, or $0.20 per diluted share compared to net income of $4.3 million, or $0.13 per diluted share in the prior-year second quarter
• Adjusted EBITDA1 increased 38.6% to $13.1 million compared to $9.5 million in the prior-year second quarter
• The Company opened six retail stores in Colorado Springs, CO; Lubbock, TX; Denton, TX; Portland, OR; Columbus, OH and Arlington, TX, totaling approximately 92,000 gross square feet
• 34th consecutive quarter of increased net sales year-over-year

Management Commentary

“We posted strong results for the second quarter and achieved our 34th consecutive quarter of increased net sales year-over-year. Our 28% top-line growth was fueled by new stores, a growing contribution from our women’s business and customer demand for our spring and summer products,” said Stephanie Pugliese, Chief Executive Officer of Duluth Trading.

“Our team achieved some significant milestones this quarter. We opened six stores, bringing our total store count to eight new stores this year. Three of the stores opened this quarter were in the state of Texas, one of our top three direct states. All six stores opened strong and we are on track to open seven more stores during the remainder of the year, for a total of 15 new stores in fiscal 2018 as planned. We also successfully implemented two major IT projects. Our order management system went live in May and our ecommerce platform was launched to our customers the first week of August.”

“These results demonstrate the strength of the Duluth Trading brand and validate the investments we have made in building our omnichannel presence over the past few years. For the balance of the year, we plan to focus on product innovation, digital marketing, opening the remaining seven stores, and the completion of key technology and infrastructure projects to prepare us for our peak selling season. We are pleased with our first half results and optimistic about the rest of the year. We expect to deliver on our fiscal 2018 guidance.”

GUIDANCE:

Duluth Holdings Inc. sees FY2018 EPS of $0.79-$0.84, versus the consensus of $0.81. Duluth Holdings Inc. sees FY2018 revenue of $555-575 million, versus the consensus of $573.54 million.

For earnings history and earnings-related data on Duluth Holdings Inc. (DLTH) click here.