Digital Brands Group said on Tuesday net revenues surged by 22.5% in the third quarter, on the back of its Sundry brand, acquired earlier this year.
The Taxes-based company said quarterly revenue from its ongoing business was $3.3 million compared to $2.7 million a year ago. The ongoing business excludes revenue from Harper & Jones, as it was spun out in the second quarter.
The net operating loss, excluding non-cash charges, was $1.2 million compared to a loss of $2.5 million a year ago.
Net loss per diluted share attributable to common stockholders was $5.4 million, or $14.55 per diluted share, compared to a loss of $4.9 million, or a loss of $223.83 per diluted share, a year ago.
“We are pleased to have turned Sundry around. Based on current trends and first quarter wholesale bookings, we are past the brand’s bottom set in August. For example, we have tripled Sundry’s first quarter 2024 wholesale bookings versus the brand’s third quarter 2023 wholesale revenue,” said Hil Davis, CEO of Digital Brands Group.
“The increase in our revenue, coupled with the cost synergies, has resulted in meaningful operating leverage and internal free cash flow that started in October. We expect our internal free cash flow to continue going forward.”
In response to the continued dislocation between Digital Brand Group’s public market value and the intrinsic value of the company’s underlying assets, DBG’s board of directors unanimously decided to initiate a formal review to explore strategic alternatives for the company, earlier this month.
Digital Brands Group has not set a deadline or definitive timetable for the completion of this process, emphasizing that there can be no assurance that this review will result in any particular outcome.
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