Destination Xl Group, Inc. · NASDAQ:DXLG
Destination Xl — Investor Presentation (April 2016)
34 slides from Destination Xl's investor presentation, Apr 5, 2016
Slide 1: Investor Presentation April 2016
Investor Presentation April 2016 Exhibit 99.1
Slide 2: Forward-Looking Statements and Non-GAAP Measures
Forward-Looking Statements and Non-GAAP Measures Forward-Looking Statements: Certain information contained in this presentation, including, but not limited to, sales, gross margin, free cash flows, EBITDA, capital expenditures and store counts for fiscal 2016 and beyond, constitute forward-looking s
Slide 3: Leading Big & Tall Men's Retailer
Leading Big & Tall Men’s Retailer Exclusive Merchandise Selection Supported by Private Brands and National Designers Significant Growth Plan With Multiple Initiatives and “Mechanical” Rollout of DXL Stores Fully Mapped Out Dominant Position in Growing Big & Tall Category P Powerful and Growing Brand
Slide 4: Strong Leadership Position in the Sector
Strong Leadership Position in the Sector Other retailers have had limited success in Big & Tall Only 4 stores owned by next-largest pure-play Two of DXL’s largest competitors attempted to create pure-play Big & Tall specialty concepts without success and closed all stores #1 online and brick-and-mor
Slide 5: Access to Depth of National Brands Creates Competitive Advantage
Access to Depth of National Brands Creates Competitive Advantage Significant focus on bringing national fashion-oriented brands to Big & Tall customers Strong relationships with many leading designers who do not address Big & Tall in other retail channels Collaborative relationship in design process
Slide 6: DXL Brand Awareness
DXL Brand Awareness 2013 2014 2015 “End of Rack” customers are defined as customers with a waist size of 46” or less.
Slide 7: End of Rack customers share of bottoms business
In December, DXL “End of Rack” customers were 47.8% of our bottoms business.
Slide 8: Value of the End of Rack Customer
Value of the End of Rack Customer For 2015, the value of the End of Rack consumer has remained consistent: Through January 2016, End of Rack customers visited 46% more often than the 48+ customer. Through January 2016, the End of Rack customer’s annual spend was 103% more than the 48+ customer.
Slide 9: DXL Store Concept Designed Specifically for the Big & Tall Customer
DXL Store Concept Designed Specifically for the Big & Tall Customer Large Changing Rooms Highly Trained Staff that Understands the Customer On-Site Tailoring Wide Aisles Bright Atmosphere Large Selection of Brands One-Stop Shop for the Big & Tall customer
Slide 10: The Destination XL Store Layout – A Lifestyle Approach
The Destination XL Store Layout – A Lifestyle Approach Effectively displaying the full range of brands and all categories Comfortable tailoring and fitting areas Ambiance appeals to target customers as well as women Located in high traffic locations with convenient access New Graphic from Peter with
Slide 11: Destination XL Store Snapshots: Club
Destination XL Store Snapshots: Club
Slide 12: Destination XL Store Snapshots: Traditional
Destination XL Store Snapshots: Traditional
Slide 13: Destination XL Store Snapshots: Studio
Destination XL Store Snapshots: Studio
Slide 14: Destination XL Store Snapshots: Polo Shop
Destination XL Store Snapshots: Polo Shop
Slide 15: Destination XL Store Snapshots: Active
Destination XL Store Snapshots: Active
Slide 16: DXL Roadmap to Stores and Beyond
DXL Roadmap to 400 Stores and Beyond Continue to execute on conversion of existing Casual Male to DXL – 265 stores Additional stores in both existing and new markets in USA – 75 stores Expand DXL concept into more outlet centers – 60 stores Continue to push Omni-channel with best in class web functi
Slide 17: High-Growth Conversion Strategy from Casual Male to DXL
High-Growth Conversion Strategy from Casual Male to DXL The store growth trajectory in new DXL stores is significantly higher than mature Casual Male XL stores. (1) Customer acquisition in DXL occurs over several years as destination locations take more time to discover than mall locations.
Slide 18: Consistent 4-Wall Cash Flow Model with High IRR
Consistent 4-Wall Cash Flow Model with High IRR DXL Large Store Model DXL Small Store Model ($ in 000s; except psf data) Year 1 Year 2 Year 3 Year 4 Year 5 Sales $870 $1,010 $1,120 $1,230 $1,320 Sales per Square Foot $160 $190 $210 $230 $250 Gross Margin (net of occupancy) $370 $460 $540 $610 $670 G
Slide 19: DXL Stores Driving Impressive Return on Investment
DXL Stores Driving Impressive Return on Investment DXL Retail Stores1 Average Sq. Ft. Year One Sales PSF Year One 4-Wall Cash Flow PSF Capital Expenditures PSF 2 IRR3 2010 – 2012 (47 stores) 9,554 $151 $22 $80 30.0% 2013 (51 stores) 8,636 $145 $25 $77 38.0% 2014 (39 stores) 7,409 $151 $25 $73 43.0%
Slide 20: High-Growth Conversion Strategy from Casual Male to DXL
High-Growth Conversion Strategy from Casual Male to DXL 46 97 140 175 206 243 282 317 346 410 357 353 345 347 359 377 391 409 0 250 500 750 1,000 1,250 1,500 1,750 2,000 2,250 2,500 0 50 100 150 200 250 300 350 400 450 500 2012 2013 2014 2015 2016E 2017E 2018E 2019E 2020E DXL Casual Male Rochester D
Slide 21: International Franchising
International Franchising Selected Primary Expansion Opportunities DXLG-Owned Rochester UK store is second-highest performer in chain Kuwait City was first franchisee in 2012. Currently generating Royalty fees of +$200k per year Inbound demand to domestic eCommerce website from over 100 countries to
Slide 22: Increasing Operating Leverage
Increasing Operating Leverage *EBITDA from continuing operations is a non-GAAP measure. See Appendix A for a reconciliation to its comparable GAAP measure.
Slide 23: DXL Store Funding from Free Cash Flow
DXL Store Funding from Free Cash Flow Fiscal 2015 produced positive free cash flow of $5.1 million before capital expenditures for DXL stores of $20.1 million In fiscal 2016, DXL stores are projected be funded completely from Free Cash Flow vs. Revolving Credit Facility
Slide 24: Strong Free Cash Flow Trend
Strong Free Cash Flow Trend 2014 2015 2013 Neg. Free Cash Flow* Pos. Free Cash Flow* EBITDA from Continuing Operations* CAPEX / Interest *Free Cash Flow and EBITDA from continuing operations are non-GAAP measures. See Appendix A for a reconciliation to their comparable GAAP measures. 2016E 2017E 201
Slide 25: Financial Performance
FINANCIAL PERFORMANCE DESTINATIONXL
Slide 26: Fiscal 2015 Highlights
Fiscal 2015 Highlights DXL comparable store sales On top of +13.7% in fiscal 2014 Total comparable sales On top of +6.4% in fiscal 2014 EBITDA from continuing operations Versus $15.2M in fiscal 2014 +9.7% +4.8% $23.3M Results reflect strength of DXL model
Slide 27: Successful Marketing Drives Performance
2013 Successful Marketing Drives Performance Fourth Quarter 2015 - Key metrics continue to improve Brand awareness Versus 13% in spring 2013 Marketing expense as % of sales Projecting 4.5% of sales for fiscal 2016 Conversion rate of Casual Male customers Versus Q4 2014 End-of-rack percentage of bott
Slide 28: Income Statement Highlights
Income Statement Highlights ($ in millions, except per share data) * Fiscal 2014 includes a $2.5 million early lease termination payment that was received in Q4 2014. ** Fiscal 2015 includes a $1.4 million accrual in Q4 for the probable payout of performance awards under the long-term incentive plan
Slide 29: Cash Flow And Balance Sheet Highlights
Cash Flow And Balance Sheet Highlights FY 2015 FY 2014 Capital Expenditures: DXL stores $20.1 $30.4 Other maintenance/infrastructure 13.3 10.5 Total $33.4 $40.9 Inventory $125.0 $115.2 Clearance inventory 8.1% 8.4% Total debt* $68.1 $52.3 Borrowings under credit facility $42.0 $18.8 Excess availabil
Slide 30: FY 2016 Outlook
FY 2016 Outlook 2013 2014 Focus on solid top-line performance, accelerate EBITDA growth Continue to deliver performance in line with our plan Reach more customers who stay longer, spend more money and shop more often Stable operating model generates consistent, predictable results Continue to utiliz
Slide 31: FY 2016 Guidance
FY 2016 Guidance Guidance Sales $465.0~$472.0 Total comparable sales increase 4.8%~5.5% Gross margin 46.2%~46.5% EBITDA* $31.0~$35.0 Net loss per share, diluted $(0.09)~breakeven Adjusted net loss per share, diluted* $(0.05)~breakeven Total debt $64.0~$69.0 Total Capital expenditures Approximately $
Slide 32: Non-GAAP Reconciliation
Non-GAAP Reconciliation The Company uses non−GAAP financial measures, such as “EBITDA from continuing operations,” ”Free Cash Flow,” “Adjusted loss,” “Adjusted loss per share,” “4-Wall Cash Flow” and “IRR” (Internal Rate of Return) in assessing its operating performance. The Company believes that th
Slide 33: Non-GAAP Reconciliation, continued
Non-GAAP Reconciliation, continued
Slide 34: Investor Contact
Investor Contact Jeffrey Unger V. P. Investor Relations Destination XL Group, Inc. jeffunger@usa.net 561-482-9715 (o) 561-543-9806 (c) www.DestinationXL.com
Destination XL Group — Investor Presentation (April 2016) on 6ix