Duluth Holdings Inc. (NASDAQ:DLTH) Q3 2019 Earnings Conference Call - Final Transcript

Dec 05, 2019 • 09:30 am ET

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Duluth Holdings Inc. (NASDAQ:DLTH) Q3 2019 Earnings Conference Call - Final Transcript

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Presentation
Executive
Dave Loretta

as steep in the level of discount. We expect to deliver sales growth of roughly 10% on a 52-week basis or net sales between $610 million and $620 million in 2019.

We expect gross margins to be down 100 to 150 basis points, which is down an additional 50 basis points from our last guidance. Selling, general and administrative expenses as a percentage of net sales to be in the range of 48% to 49%. We expect 2019 earnings per diluted share to be between $0.60 and $0.66 which compares the $0.68 last year on a 52-week basis.

Additionally, we do expect to realize a tax benefit related to R&D credits, which we'll post in the fourth quarter and bring the full year tax rate down to approximately 22.5%. We expect adjusted EBITDA to be between $51 million and $55 million and capital expenditures of approximately $38 million.

As Steve noted, we entered the fourth quarter prepared for success, while we still have close to three weeks of critical shopping activity ahead, current indications are that customers continue to shop closer to Christmas. The four days of Black Friday through Cyber Monday were healthy for both our channels compared to the same events last year. However, due to Thanksgiving being one week later this year. The three weeks leading up to the holiday came in below last year. That being said, we are positioned to make up for the lag sales during the compressed shopping period and we'll continue to execute our fourth quarter game plan.

With that, we'll open the line for questions. Operator?