The apparel provider, Digital Brands Group Inc. (DBGI) posted its 2021 financial results on March 31, 2022. While the company’s latest earnings did show some nice YOY improvement, investors remained unimpressed. Thus, in the most recent trading session, DBGI sank by 5.26% to trade at $1.80 per share. Comparatively, the earlier trading session recorded a gain of 6.15% at the sock’s closing price of $1.90. Both the session witnessed a good deal of shares that were above the usual traffic, marking 5.01 million for the regular and 1.69 million for the after-hours session.
Even though the stock stands on a year-to-date loss of 17.39%, it has been improving since last month.
DBGI’s 2021 Earnings Analysis
The Texas-based company reported a YOY growth of a mammoth 425% for the ending quarter of 2021. Thus, the reported revenue was valued at $4.0 million against the year-ago quarter’s $0.8 million.
Not just the revenue but the company’s gross profit margin and net loss also witnessed much improvement in the quarter. DBGI’s gross margin exponentially improved from a negative 4.8% to 42.2% in the quarter.
While the net loss was $9.7 million, the diluted EPS was $0.76 in Q4 2021. These values compare to the prior-year quarter’s $2.6 million net loss with negative EPS of $3.97.
Investors seem to have been looking forward to much more from the company as the reported improvement was not enough to sway them into buying the stock. With the inclusion of Stateside and Harper & Jones (Pro-forma basis), the investors expected further improvement.
According to previous reports, the company initially expected much better revenue for the quarter but supply-chain hurdles and global delays impacted it.
How Does the Current Quarter Look?
While the company did not provide any guidance for the ongoing quarter or year, recently it had posted Q1 2022’s progress. For the months of January and February alone, DBGI’s e-commerce revenue increased by 776%. Not only this but the wholesale channel also progressed with over 200% increased YOY for the two months.
In conclusion, while the 2021 earnings were not up to par for the investors, the current quarter’s progress thus far seems up to the mark. With such immense growth in just two months, Q1 2022 seems right on track for record revenue growth. With more acquisitions in a plan, the results are only expected to improve further from this point on.
Currently, DBGI is in the post definitive agreement period of acquiring Sundry. The company expects to complete the acquisition of the global lifestyle apparel brand in H1 2022.