Digital Brands Group Forecasts $27M to $30M in Revenue, $6M to $7M in Internal Free Cash Flow and $1.5M to $2.0M in EBITDA for 2024

Rhea-AI Summary

Digital Brands Group, Inc. (DBG) (NASDAQ: DBGI) announces a 70% to 90% increase in revenue expectations for 2024, with an initial guidance of $27 million to $30 million. The company also forecasts EBITDA of $1.5 million to $2.0 million and $6.0 million to $7.0 million in internal free cash flow for 2024. CEO Hil Davis expresses commitment to shareholder growth and explores strategic alternatives to maximize shareholder value.

Financial Analyst

The guidance provided by Digital Brands Group, Inc. indicates a substantial projected revenue increase, which is typically a positive signal for investors and can influence the company's stock valuation. The forecasted growth rate of 70% to 90% is significant, especially considering the scale at which DBG operates. The market often responds favorably to such optimistic guidance, as it suggests confidence in the company's business model and growth strategy.

Furthermore, the mention of EBITDA turning positive, with expectations between $1.5 million to $2.0 million, is a critical factor. EBITDA, or Earnings Before Interest, Taxes, Depreciation and Amortization, is a widely used earnings metric to assess a company's operational efficiency and profitability before non-operating expenses and non-cash charges. Positive EBITDA implies that DBG is not only generating revenue but also managing its operational costs effectively, which could lead to improved profitability and potentially enhance investor sentiment.

The forecast of $6.0 million to $7.0 million in internal free cash flow is also noteworthy. Free cash flow is the cash a company generates after accounting for cash outflows to support operations and maintain its capital assets. It's a significant indicator of financial health, as it shows the company's ability to generate enough cash to pursue growth opportunities, reduce debt, or return capital to shareholders. In DBG's case, a strong free cash flow forecast may suggest a solid balance sheet and operational efficiency, which are attractive to investors.

Market Research Analyst

DBG's strategic focus on leveraging its shared services platform to increase operational efficiency could be a key driver behind the optimistic revenue and EBITDA forecasts. Shared services models can reduce costs by centralizing business operations and leveraging economies of scale, which can lead to improved margins. This strategy, combined with the increase in wholesale bookings, suggests that DBG is effectively expanding its market presence and customer base.

Additionally, the company's review of strategic alternatives to maximize shareholder value in light of its assets and operating forecast relative to its public market value indicates proactive management. This can be reassuring for investors, as it demonstrates a commitment to exploring all avenues for growth and value creation, which may include mergers, acquisitions, divestitures, or other corporate restructuring activities.

It's important to note that while the company's revenue guidance and strategic initiatives are promising, the actual performance will depend on DBG's ability to execute its business plan and adapt to market changes. Investors will likely monitor the company's progress closely, especially in a dynamic and competitive luxury lifestyle market.

Economist

The projected increase in revenue and positive EBITDA for DBG may have broader economic implications. A strong performance by a luxury lifestyle brand could indicate consumer confidence and discretionary spending health, which are important economic indicators. Luxury goods often have higher price elasticity and their sales can reflect the state of the economy and consumer sentiment.

Moreover, DBG's guidance could reflect underlying trends in the digital-first retail space. As consumers increasingly turn to online shopping, companies that effectively harness digital platforms for sales and marketing may experience accelerated growth. DBG's success in this area could be a microcosm of the broader shift towards e-commerce and the digital transformation of the retail industry.

However, it is crucial to consider macroeconomic factors such as inflation, interest rates and consumer spending patterns, as they can significantly impact the luxury goods market. Investors would do well to keep an eye on these indicators, as they may influence DBG's ability to meet its ambitious revenue targets.

AUSTIN, Texas, Jan. 3, 2024 /PRNewswire/ -- Digital Brands Group, Inc. ("DBG")  (NASDAQ: DBGI), a curated collection of luxury lifestyle, digital-first brands, today announces its initial 2024 revenue guidance of $27 million to $30 million, an increase of 70% to 90% from 2023 revenue expectations.  As we stated on our most recent quarterly call, we expect our first quarter 2024 revenues to approximate $6 million, based on $4.5 million in confirmed wholesale bookings.        

The Company forecasts EBITDA of $1.5 million to $2.0 million for 2024, as it leverages its shared services platform and increased wholesale bookings.  Additionally, the Company forecasts $6.0 million to $7.0 million in internal free cash flow for 2024.

"We are excited to showcase our commitment to shareholder growth in 2024. As part of this commitment, we continue to review strategic alternatives, especially given our assets and operating forecast relative to our public market value. We have several options to maximize shareholder value, which we will pursue if this dislocation remains," said Hil Davis, Chief Executive Officer of Digital Brands Group.

Forward-looking Statements

Certain statements included in this release are "forward-looking statements" within the meaning of the federal securities laws. Forward-looking statements are made based on our expectations and beliefs concerning future events impacting DBG and therefore involve several risks and uncertainties. You can identify these statements by the fact that they use words such as "will," "anticipate," "estimate," "expect," "should," and "may" and other words and terms of similar meaning or use of future dates, however, the absence of these words or similar expressions does not mean that a statement is not forward-looking. All statements regarding DBG's plans, objectives, projections and expectations relating to DBG's operations or financial performance, and assumptions related thereto are forward-looking statements. We caution that forward-looking statements are not guarantees and that actual results could differ materially from those expressed or implied in the forward-looking statements. DBG undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. Potential risks and uncertainties that could cause the actual results of operations or financial condition of DBG to differ materially from those expressed or implied by forward-looking statements include, but are not limited to: risks arising from the widespread outbreak of an illness or any other communicable disease, or any other public health crisis, including the coronavirus (COVID-19) global pandemic; the level of consumer demand for apparel and accessories; disruption to DBGs distribution system; the financial strength of DBG's customers; fluctuations in the price, availability and quality of raw materials and contracted products; disruption and volatility in the global capital and credit markets; DBG's response to changing fashion trends, evolving consumer preferences and changing patterns of consumer behavior; intense competition from online retailers; manufacturing and product innovation; increasing pressure on margins; DBG's ability to implement its business strategy; DBG's ability to grow its wholesale and direct-to-consumer businesses; retail industry changes and challenges; DBG's and its vendors' ability to maintain the strength and security of information technology systems; the risk that DBG's facilities and systems and those of our third-party service providers may be vulnerable to and unable to anticipate or detect data security breaches and data or financial loss; DBG's ability to properly collect, use, manage and secure consumer and employee data; stability of DBG's manufacturing facilities and foreign suppliers; continued use by DBG's suppliers of ethical business practices; DBG's ability to accurately forecast demand for products; continuity of members of DBG's management; DBG's ability to protect trademarks and other intellectual property rights; possible goodwill and other asset impairment; DBG's ability to execute and integrate acquisitions; changes in tax laws and liabilities; legal, regulatory, political and economic risks; adverse or unexpected weather conditions; DBG's indebtedness and its ability to obtain financing on favorable terms, if needed, could prevent DBG from fulfilling its financial obligations; and climate change and increased focus on sustainability issues. More information on potential factors that could affect DBG's financial results is included from time to time in DBG's public reports filed with the SEC, including DBG's Annual Report on Form 10-K, and Quarterly Reports on Form 10-Q, and Forms 8-K filed or furnished with the SEC.

About Digital Brands Group
We offer a wide variety of apparel through numerous brands on a both direct-to-consumer and wholesale basis. We have created a business model derived from our founding as a digitally native-first vertical brand. We focus on owning the customer's "closet share" by leveraging their data and purchase history to create personalized targeted content and looks for that specific customer cohort. 

Digital Brands Group, Inc. Company Contact
Hil Davis, CEO
Email: invest@digitalbrandsgroup.co 
Phone: (800) 593-1047

Related Links

https://ir.digitalbrandsgroup.co 

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SOURCE Digital Brands Group, Inc.

What is the revenue guidance for Digital Brands Group, Inc. for 2024?

Digital Brands Group, Inc. (DBG) (NASDAQ: DBGI) expects a 70% to 90% increase in revenue, with an initial guidance of $27 million to $30 million for 2024.

What is the forecast for EBITDA for Digital Brands Group, Inc. in 2024?

The company forecasts EBITDA of $1.5 million to $2.0 million for 2024.

What is the projected internal free cash flow for Digital Brands Group, Inc. in 2024?

Digital Brands Group, Inc. forecasts $6.0 million to $7.0 million in internal free cash flow for 2024.

Who is the CEO of Digital Brands Group, Inc.?

Hil Davis is the Chief Executive Officer of Digital Brands Group, Inc.

What strategic alternatives is Digital Brands Group, Inc. exploring?

The company is exploring strategic alternatives to maximize shareholder value, especially given its assets and operating forecast relative to its public market value.