Duluth Holdings has filed an amended S-1 form with the U.S. Securities and Exchange Commission (SEC) for its initial public offering (IPO). No terms were given in the filing, but the offering is valued up to $115 million. The company intends to list its Class B shares on the Nasdaq Global Market under the symbol DLTH.
There are two classes of authorized common stock. The rights of holders of Class A common stock and Class B common stock are identical, except for voting and conversion rights. Each share of Class A common stock is entitled to 10 votes per share and is convertible at any time into one share of Class B common stock. Each share of Class B common stock is entitled to one vote per share.
The underwriters for the offering are William Blair, Baird, Raymond James and BMO Capital Markets.
This company is a rapidly growing lifestyle brand of men’s and women’s casual wear, workwear and accessories sold exclusively through its own channels. Duluth offers a comprehensive line of innovative, durable and functional products, such as Longtail shirts, Buck Naked underwear and Fire Hose work pants, which reflect its position as the Modern, Self-Reliant American Lifestyle brand.
The brand has a heritage in workwear that transcends tradesmen and appeals to a broad demographic of men and women for everyday and on-the-job use. Approximately 88% of fiscal 2014 net sales consisted of proprietary products sold under the Duluth Trading brand name.
In the filing, Duluth said:
We believe the foundation of our success is our culture of “poking average in the eye” by seeing things for what they could be and should be and finding a way to make them exactly that, and we like to do it all with a big, toothy grin. Our brand is defined by: solution-based products manufactured with high quality craftsmanship, humorous and distinctive marketing and an outstanding customer experience.
The company has established a strong track record of growth and profitability as demonstrated by its net sales and operating income compound annual growth rates between calendar 2009 and fiscal 2014 of 28% and 51%, respectively. Duluth believes that the foregoing attributes have enabled it to deliver strong financial results:
- Net sales have increased year over year for 24 consecutive quarters through August 2015.
- Net sales in fiscal 2014 increased by 42.2% over the prior year to $231.9 million, and net sales in the first six months of fiscal 2015 increased by 37.0% over the first six months of the prior year to $108.5 million.
- Retail stores have achieved an average payback of less than two years.
The net proceeds from this offering are intended to be put toward paying down indebtedness, working capital and general corporate purposes.
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