Duluth Holdings Inc. Annual Report 2023

← All annual reports

FY2023 Annual Report · Duluth Holdings Inc.

Loading PDF…

®
®
®

PO BOX 159 | 201 EAST FRONT STREET | MOUNT HOREB, WI 53572

DULUTH HOLDINGS INC. 2023 ANNUAL REPORT
DULUTH HOLDINGS INC. 2023 ANNUAL REPORT
DULUTH HOLDINGS INC. 2023 ANNUAL REPORT

EXECUTIVE MANAGEMENT

CORPORATE INFORMATION

Samuel M. Sato

President and Chief Executive Officer

Heena K. Agrawal

Senior Vice President and Chief Financial Officer

Senior Vice President and Chief Technology

Albert J. Sutera

Officer and Logistics

David S. Homolka

Retail Operations

Richard W. Schlecht

and Sourcing

Neala K. Shepherd

Senior Vice President of Talent, DE&I and

Senior Vice President of Product Development

Senior Vice President of Brand and Marketing

BOARD OF DIRECTORS

Stephen L. Schlecht

Chairman and Founder

Samuel M. Sato

President and Chief Executive Officer

Francesca M. Edwardson

Former Chief Executive Officer

American Red Cross of Chicago and

Northern Illinois

David C. Finch

Former Chief Executive Officer

Daniele International, LLC

Janet H. Kennedy

Former Vice President

North America Regions of Google Cloud

Former President and Chief Executive Officer

PJM Interconnection

Alphabet, Inc.

Brett L. Paschke

Managing Partner

WinForest Partners

Susan J. Riley

Ronald Robinson

Chief Supply Chain Officer

Designer Brands, Inc.

Scott K. Williams

Chief Executive Officer

Batteries Plus Bulbs

Corporate Offices

Duluth Trading Company

201 East Front Street

Mount Horeb, WI 53572

Tel: 608-424-1544

Web: duluthtrading.com

Independent Auditors

KPMG LLP

Registrar and Transfer Agent

Computershare

150 Royall Street, Suite 101

Canton, MA 02021

Tel: 877-736-3001

Web: www.computershare.com/us

Class B Common Stock

NASDAQ Global Select Market

Symbol: DLTH

Form 10-K and Other Reports

Our Annual Report on Form 10-K, charters

of the Board’s committees, and our code of

ethics are made available on our website:

ir.duluthtrading.com. Shareholders may

request printed copies (which will be provided

free of charge) from Investor Relations.

Email: DuluthIR@icrinc.com

The SEC also maintains a website that contains

reports, proxy information, statements, and

other information regarding registrants who

file electronically with the SEC. The website

address is: www.sec.gov

Forward-Looking Statements

This Annual Report contains “forward-looking

statements” within the meaning of the Private

Securities Litigation Reform Act of 1995. All

forward-looking statements are subject to risk

and uncertainties which could cause actual

results to vary materially from such statements

including the risks and uncertainties described

under Part I, Item 1A “Risk Factors,” in our

Annual Report on Form 10-K for the fiscal year

ended January 28, 2024.

DEAR FELLOW SHAREHOLDERS,

Duluth Trading was founded on the belief that there’s
gotta be a better way. A better way to solve. A better way
to make. A better way to be. We’re on a mission to build
better, harder-working apparel and gear that helps enable
everyone, from the young to the young at heart, to take
on life with their own two hands and live on terms that are
uniquely their own.

Our secret sauce is anchored on better brands, better
innovation, better marketing, and better consumer
experiences. Duluth Trading believes that you can accomplish anything you put
your mind and your own two hands to. We have a long, colorful history of product
innovation and solution-based design, and we create distinctive marketing made to
break through the clutter.

We pride ourselves on providing outstanding and engaging customer experiences.
We’ve built a unique business that not only strives for growth and creates value, but
also serves the best interests of our customers, employees, and shareholders.

We believe our company has a greater purpose to live by, which is illustrated by three
interwoven stitches: humanity, community and sustainability.

Humanity. Reflecting that we are a people-first organization, we celebrated the
launch of our Employee Assistance Fund, a nonprofit organization designed to
provide immediate financial assistance to employees following an unforeseen
disaster or personal hardship. We value a respectful and inclusive culture that
extends opportunities for all.

Community. Recognizing that we invest in our communities with a long-standing
commitment to empower a hands-on lifestyle, we are pleased to continue our
multi-year pledge of $1.2 million to the Boys and Girls Club of Dane County, WI. This
donation helps fund the McKenzie Regional Workforce Center, a first of its kind to
prepare young people for careers in the skilled trades.

Sustainability. Highlighting our commitment to reduce adverse environmental
impacts, we’ve incorporated sustainability into everything from the design to the
delivery of our products. With a focus on durability, we launched Fire Hose HD, a high-
tech fabric that withstands abrasion four times better than cotton canvas work pants.
Durability is sustainability, as products that last longer result in less waste in landfills.

2023 WAS A YEAR OF RESILIENCE AND PROGRESS

Our teams remained resilient in the face of continued macroeconomic challenges
by focusing on what we do best – bringing innovative products to market for our
consumers, marketing to engage new younger consumers, and investing our dollars
to drive a higher return.

Our organization made meaningful progress on our key strategic initiatives as
outlined in our Big Dam Blueprint. We remained steadfast in our commitment to
strengthen the foundation of our business and unlock the next phase of sustainable,
profitable growth.

Financial Results

In 2023, we delivered net sales of $646.7 million, Adjusted EBITDA of $33.4M and EPS
of ($0.28).

We ended the year with strong liquidity of $232.2 million, with $32.2 million of
cash and no outstanding bank debt on our line of credit. Our net working capital
was $78.5 million as we managed our inventory down 19% or $29.2 million vs. prior
year. Our inventory composition is healthy with 90% in current products and a 30%
decrease in clearance items. We funded a peak year in capital expenditures of $53.2
million without any debt at the end of the year.

Macroenvironment

The macroenvironment was challenging, with forecasts of a recession, steadily
depleting consumer savings, tightening monetary policy, rising interest rates, and
persistent inflation. Consumers spent more on necessities like groceries, leaving
less for discretionary items. The apparel industry worked through excess inventory
with more frequent and deeper discounts. Consumers gravitated toward mass and
discount channels as well as promotions. We saw our highest-ever sales from the
Thanksgiving to mid-Cyber Week period when we ran our global promotional event.
This put downward pressure on our margins, and we ended the year with 50.3% gross
margin. We expect meaningful gross margin improvement over the next several
years through acceleration of our sourcing and product innovation initiatives.

Product Innovation

Within our core categories as well as our AKHG brand, we delivered innovative
and unique first-to-market fabrications and features that set Duluth apart in the
marketplace:

•

We introduced Fire Hose HD, the next generation of our iconic Fire Hose
pants, with the strongest, lightest-weight work pants fabric on the market.

•

We expanded our core underwear category by offering men’s Buck Smooth, a
more vibrant, patterned style within our fan-favorite Buck Naked line.

We expanded our quick-drying Dry on the Fly technology into tees and
underwear across both men’s and women’s.

We capitalized on the popularity of our women’s Heirloom Gardening
collection by adding fresh new colors and prints as well as fleece-lined
overalls in the fall, converting it to a year-round business.

We expanded our women’s intimates with a strong consumer response to
innovation as the TeeLUXE Bra became the #1 style in its launch season.

And finally, we launched AKHG Fitness, our first-ever fitness apparel, for both
men and women in sizes up to 3x. The assortment, built for “nature’s gym,”
includes tanks, shorts, hybrid jackets, and post-exercise sweats that stretch,
wick, breathe, and dry in a flash.

Consumer Focus

To bring awareness to our innovation and product offerings, our Marketing and
Creative teams ramped up investments in social influencers and consistently
engaged both existing and new consumers through relevant content across
streaming video and audio, as well as cable TV. We strategically retargeted past
customers with personalized content and targeted a new, younger consumer, making
meaningful gains in both. Our investment in re-platforming the Duluthtrading.com
website tailored for mobile usability and a frictionless shopping experience led to
high-single-digit direct channel growth driven by higher conversion, catapulting
mobile to our largest channel for consumer purchases, and accounting for over half
of our total direct channel sales.

Big Dam Blueprint

I am extremely proud of the tremendous progress we have made on key strategic
initiatives that have enabled a greater penetration of digital sales, especially mobile,
lower variable fulfillment costs, future gross margin expansion, and future revenue
growth opportunities.

As initially introduced in 2021, the five pillars of our Big Dam Blueprint include:

1. Lead with a digital mindset.

2. Intensify our efforts to optimize our owned DTC channels.

3. Evolve the Company’s platform to grow into a multi-brand and multi-channel
business .

4. Prioritize test and learn to unlock long-term growth.

5. Future proof the business through investments in capabilities and infrastructure.

Let me update you on the progress we made in 2023.

First, our largest ever capital investment of $55M in the Adairsville, GA fulfillment
center was executed by the cross-functional team on time and on budget. We
achieved our plan to process up to 60% of all online orders and store replenishment
volume through this facility, shortened delivery times, and drove lower variable
costs per unit to fulfill an order at 42% of the average cost of our three legacy
fulfillment centers during the last four months of the fiscal year, helping us future
proof our business for future growth and scale.

Second, we meaningfully advanced our sourcing and product innovation functions,
including onboarding a new Vice President of Sourcing during the fourth quarter. We
believe this will allow us to bring to market high-quality, innovative products more
frequently, increase our speed to market, and significantly reduce our product costs.
This is a significant unlock, and we expect the benefits will begin to materialize in
2024 and continue to build over time.

Finally, we completed several foundational initiatives to execute our technology
transformation roadmap, the continuation of which will become the primary focus
of our capital expenditure outlays to provide analytical, operational, and decision
tools to maximize the business.

Looking Ahead

In 2024, we remain focused on accelerating the operational improvements of the
strategic roadmap by expanding our pipeline of new and innovative products,
optimizing our marketing mix, improving gross profit margin rates, and controlling
what we can control by prudently managing expenses and inventories.

I want to thank our teams for being resilient, staying focused on delighting our
consumer, and making steadfast progress toward our strategic goals. I am excited
about the journey ahead and the future of our company.

l
Samuel M. Sato
President and Chief Executive Officer
Duluth Holdings Inc.

SUMMARY OF FINANCIAL PERFORMANCE

DIRECT-TO-CONSUMER,
STORE AND TOTAL NET SALES

CAGR = 2.6%

$638.8

$178.0

$615.6

$265.2

$568.1

$217.5

$698.6

$260.1

$653.3

$241.2

$646.7

$221.1

DILUTED EPS

$0.90

$0.71

$0.58

$0.42

$350.6

$350.4

$460.8

$438.5

$412.1

$425.6

$0.07

($ 0.28)

FY 18

FY 19

FY 20

FY 21

FY 22

FY 23

FY 18

FY 19

FY 20

FY 21

FY 22

FY 23

Direct-to-Consumer

Store Sales

ADJUSTED EBITDA AND % OF NET SALES

(1)

CAPITAL EXPENDITURES

$50.8

$53.2

11.8%

8.4%

8.1%

7.8%

6.7%

5.2%

$51.8

$51.9

$54.7

$77.4

$43.5

$33.4

$30.8

$31.5

$16.4

$15.1

FY 18

FY 19

FY 20

FY 21

FY 22

FY 23

FY 18

FY 19

FY 20(1)

FY 21(2)

FY 22(3)

FY 23(4)

Adjusted EBITDA $

Adjusted EBITDA % of net sales

(1)

Non-GAAP Measure. See “Reconciliation of Net (Loss) Income to EBITDA and EBITDA to
Adjusted EBITDA” section in the “Management’s Discussion and Analysis of Financial
Conditions and Results of Operations” section for a reconciliation of our net (loss) income
to EBITDA and EBITDA to Adjusted EBITDA, both of which are non-U.S. GAAP financial
measures. See also the information under the heading “Adjusted EBITDA” in the subsection
“How We Assess the Performance of Our Business” for our definition of Adjusted EBITDA.

(1)

Includes $4.1 of additional investments in implementation costs to enhance the value of
hosting arrangements, which are included in Prepaid expenses & other current assets on
the Company’s Consolidated Balance Sheets.

(2)

Includes $4.7 of additional investments in implementation costs to enhance the value of
hosting arrangements, which are included in Prepaid expenses & other current assets on
the Company’s Consolidated Balance Sheets.

(3)

Includes $6.1 of additional investments in implementation costs to enhance the value of
hosting arrangements, which are included in Prepaid expenses & other current assets on
the Company’s Consolidated Balance Sheets.

(4)

Includes $5.8 of additional investments in implementation costs to enhance the value of
hosting arrangements, which are included in Prepaid expenses & other current assets on
the Company’s Consolidated Balance Sheets.

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended January 28, 2024
OR

 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from

Commission file No. 001-37641
DULUTH HOLDINGS INC.

(Exact name of registrant as specified in its charter)

Wisconsin

(State or other jurisdiction of
incorporation or organization)

201 East Front Street, Mount Horeb, Wisconsin

(Address of principal executive offices)

39-1564801

(I.R.S. Employer
Identification Number)

53572

(Zip Code)

Registrant’s telephone number, including area code: (608) 424-1544
Securities registered pursuant to Section 12(b) of the Act:
Trading Symbol(s)

Title of each class
Class B Common Stock, No Par Value

DLTH

NASDAQ Global Select Market

Name of each exchange on which registered

Securities registered pursuant to Section 12(g) of the Act:
None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes  No 
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes  No 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act

of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes  No 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit
such files). Yes  No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and
“emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer
Non-accelerated filer
Emerging Growth Company





Accelerated filer
Smaller reporting company




If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with

any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its
internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm
that prepared or issued its audit report. 

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant

included in the filing reflect the correction of an error to previously issued financial statements. 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based
compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No 
The aggregate market value of voting stock held by non-affiliates of the Registrant was approximately $78.8 million based upon the closing

price on the last business day of the registrant’s most recently completed second fiscal quarter (July 30, 2023).

The number of shares outstanding of the Registrant’s Class A common stock, no par value, as of March 20, 2024, was 3,364,200. The number of

shares outstanding of the Registrant’s Class B common stock, no par value, as of March 20, 2024 was 31,047,516.

DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant’s definitive proxy statement to be filed within 120 days of January 28, 2024 are incorporated by reference in this

Annual Report on Form 10-K in response to Part III, Items 10, 11, 12, 13 and 14.

TABLE OF CONTENTS

PART I

ITEM 1.

BUSINESS

ITEM 1A. RISK FACTORS

ITEM 1B. UNRESOLVED STAFF COMMENTS

ITEM 1C. CYBERSECURITY

ITEM 2.

PROPERTIES

ITEM 3.

LEGAL PROCEEDINGS

ITEM 4.

MINE SAFETY DISCLOSURES

INFORMATION ABOUT OUR EXECUTIVE OFFICERS

ITEM 5.

MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER
MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

PART II

ITEM 6.

[RESERVED]

ITEM 7.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

ITEM 9A. CONTROLS AND PROCEDURES

ITEM 9B. OTHER INFORMATION

ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

PART III

ITEM 11.

EXECUTIVE COMPENSATION

ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
AND RELATED SHAREHOLDER MATTERS

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR

INDEPENDENCE

ITEM 14.

PRINCIPAL ACCOUNTANT FEES AND SERVICES
PART IV

ITEM 15.

EXHIBITS, FINANCIAL STATEMENTS AND SCHEDULE

ITEM 16.

FORM 10-K SUMMARY

SIGNATURES

Page

FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains “forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995 that are subject to risks and uncertainties. All statements other than statements of historical or
current facts included in this Annual Report on Form 10-K are forward-looking statements. Forward-looking statements refer to
our current expectations and projections relating to our financial condition, results of operations, plans, objectives, strategies,
future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to
historical or current facts. These statements may include words such as “anticipate,” “could,” “design,” “estimate,” “expect,”
“project,” “plan,” “potential,” “intend,” “believe,” “may,” “might,” “will,” “objective,” “should,” “would,” “can have,” “likely”
and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or
financial performance or other events. For example, all statements we make relating to our estimated and projected earnings,
revenue, costs, expenditures, cash flows, growth rates and financial results, our plans and objectives for future operations,
growth or initiatives, strategies or the expected outcome or impact of pending or threatened litigation are forward-looking
statements. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ
materially from those that we expected, including:

•

the impact of inflation and measures to control inflation on our results of operations;

the prolonged effects of economic uncertainties on store and website traffic;

disruptions to our distribution network, supply chains and operations;

our ability to maintain and enhance a strong brand and sub-brand image;

adapting to declines in consumer confidence, inflation and decreases in consumer spending;

disruptions to our e-commerce platform;

effectively adapting to new challenges associated with our expansion into new geographic markets;

our ability to meet customer delivery time expectations;

natural disasters, unusually adverse weather conditions, boycotts, prolonged public health crises, epidemics or
pandemics and unanticipated events;

generating adequate cash from our existing stores and direct sales to support our growth;

the impact of changes in corporate tax regulations and sales tax;

identifying and responding to new and changing customer preferences;

the success of the locations in which our stores are located;

effectively relying on sources for merchandise located in foreign markets;

transportation delays and interruptions, including port congestion;

our inability to timely and effectively obtain shipments of products from our suppliers and deliver merchandise to
our customers;

the inability to maintain the performance of maturing store portfolio;

our inability to deploy marketing tactics to strengthen brand awareness and attract new customers in a cost effective
manner;

our ability to successfully open new stores;

competing effectively in an environment of intense competition;

our ability to adapt to significant changes in sales due to the seasonality of our business;

price reductions or inventory shortages resulting from failure to purchase the appropriate amount of inventory in
advance of the season in which it will be sold;

the potential for further increases in price and availability of raw materials;

our dependence on third-party vendors to provide us with sufficient quantities of merchandise at acceptable prices;

the susceptibility of the price and availability of our merchandise to international trade conditions;

failure of our vendors and their manufacturing sources to use acceptable labor or other practices;

•

our dependence upon key executive management or our inability to hire or retain the talent required for our
business;

increases in costs of fuel or other energy, transportation or utility costs and in the costs of labor and employment;

failure of our information technology systems to support our current and growing business, before and after our
planned upgrades;

disruptions in our supply chain and fulfillment centers;

our inability to protect our trademarks or other intellectual property rights;

infringement on the intellectual property of third parties;

acts of war, terrorism or civil unrest;

the impact of governmental laws and regulations and the outcomes of legal proceedings;

changes in U.S. and non-U.S. laws affecting the importation and taxation of goods, including imposition of
unilateral tariffs on imported goods;

our ability to secure the personal and/or financial information of our customers and employees;

our ability to comply with the security standards for the credit card industry;

our failure to maintain adequate internal controls over our financial and management systems; and

acquisition, disposition, and development risks.

We make many of our forward-looking statements based on our operating budgets and forecasts, which are based upon
detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the
impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results.

See the “Risk Factors” section of this Annual Report on Form 10-K for a more complete discussion of the risks and
uncertainties mentioned above and for discussion of other risks and uncertainties. All forward-looking statements attributable to
us are expressly qualified in their entirety by these cautionary statements as well as others made in this annual report and
hereafter in our other SEC filings and public communications. You should evaluate all forward-looking statements made by us
in the context of these risks and uncertainties.

We caution you that the risks and uncertainties identified by us may not be all of the factors that are important to you.
Furthermore, the forward-looking statements included in this Annual Report on Form 10-K are made only as of the date hereof.
We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future
events or otherwise, except as otherwise required by law.

ITEM 1.

BUSINESS

PART I

Unless the context indicates otherwise, the terms the “Company,” “Duluth,” “Duluth Trading,” “Duluth Holdings,”

“Duluth Trading Company,” “Duluth Trading Co.,” “we,” “our” or “us” are used to refer to Duluth Holdings Inc.

The following discussion contains references to fiscal years 2023 and 2022, which refer to our fiscal years ended

January 28, 2024 and January 29, 2023, respectively. Fiscal years 2023 and 2022 were 52-week periods.

Duluth Trading is a lifestyle brand of men’s and women’s workwear, casual wear, outdoor apparel and accessories
primarily sold through our own omnichannel platform. We offer products nationwide through our website. In 2010, we initiated
our omnichannel platform with the opening of our first store. Since then, we have expanded our retail presence, and as of
January 28, 2024, we operated 62 retail stores and three outlet stores.

Duluth Trading was founded in 1989 when two brothers in the home construction industry were tired of dragging tools
from job to job using discarded five-gallon drywall compound buckets. The two brothers were never satisfied with the status
quo and believed “there’s gotta be a better way.” So, they invented the Bucket Boss® - a ruggedly durable canvas tool
organizer that fits around a drywall bucket and transformed the way construction workers organized their tools. Capitalizing on
their initial success, these brothers launched a catalog that later became known as Duluth Trading Company. Under the initial
philosophy of “Job Tough, Job Smart,” this catalog was dedicated to improving and expanding on existing methods of tool
storage, organization and transport. In December 2000, GEMPLER’S Inc., a Wisconsin corporation and an agricultural and
horticultural supply catalog business founded and owned by Stephen L. Schlecht, acquired Duluth Trading and brought the two
mail order companies together. Both catalogs had customers who worked outside and embraced the spirit of hands-on, self-
reliant Americans. In February 2003, the GEMPLER’s catalog business was sold to W.W. Grainger (NYSE:GWW) and
proceeds from that sale were used to fund the growth of Duluth Trading. With that transaction, GEMPLER’S changed its
corporate name to Duluth Holdings Inc.

From what began as an idea aimed at those working in the building trades, Duluth Trading has become a widely
recognized brand and proprietary line of innovative and functional apparel and gear. We have created strong brand awareness
and built a loyal customer base. 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 Growth Strategies

In 2021, the Company completed a comprehensive review of current operations, logistics networks, marketing and

technology capabilities, and unique brands and products. The Company formulated the “Big Dam Blueprint”, which
management believes will unlock the Company’s full potential for long-term, sustainable growth.

•

Begin with a digital-first mindset that integrates technology into all areas of the business, fundamentally
changing how we operate and deliver value to customers.

Intensify efforts to optimize Duluth Trading’s owned retail channels by increasing focus and investments in
our direct channel as our primary growth vehicle. We are conducting strategic research that will inform decisions
on future stores regarding new locations and market share potential, size, format, and assortment.

Evolve the Company’s platform to grow into a multi-brand and multi-channel business. Create unique brand
positions, across men’s and women’s, for Duluth and AKHG, as well as for our important Buck Naked franchise to
address customer needs for various occasions including work, outdoor recreation, casual lifestyle, and first layer.
Invest in the evolution of the Duluth Trading platform to enable the integration of new brands and channels, expand
our product offering and broaden our customer base.

Prioritize test and learn to unlock long-term growth potential. Explore new opportunities to engage current and
potential customers through products, services and touchpoints that they expect and value.

Future proof the business through investments in capabilities and infrastructure. Including logistics,
operations, and planning systems, processes, and talent needed to scale the business and enable a multi-brand and
multi-channel strategy.

Omnichannel

Our omnichannel business strategy allows our sales channels to work in synergy to seamlessly deliver a consistent brand

experience to the customer, including consistent marketing, pricing and product presentation. All sales channels are fully
integrated, including stores, website, catalogs and customer contact centers. Our omnichannel services include order-in-store,
buy-online-pickup-in-store, and ship-from-store as well as retail store and mobile shopping experiences.

Retail Store Environment

Our retail stores are designed to bring our brand to life by creating a unique and entertaining experience, including
engaging sales associates, a compelling and complete product assortment, and custom-made fixtures to fit our brand. We also
showcase unique attractions at each retail store that celebrate the heritage of the local area, such as the tool museum in our Mt.
Horeb, Wisconsin store and the “Exploded Tractor” exhibit in our Ankeny, Iowa store. We believe these local community
elements help promote customer loyalty and drive repeat purchases.

Our Products

We offer a comprehensive line of innovative, durable and functional workwear, casual wear, outdoor apparel and
accessories for both men and women. Our product assortment includes shirts, pants, shorts, underwear, outerwear, footwear,
accessories and hard goods. Our products feature proprietary designs and distinct names, such as our Longtail T® shirts, Buck
NakedTM underwear, Fire Hose® work pants and No-YankTM Tank.

Our product assortment appeals to our customers for their everyday and on-the-job use. The majority of our products
represent enduring styles that go beyond short-lived fashion trends. We believe many of our customers’ purchases are driven by
our thoughtful design and high-quality craftsmanship, and our best-selling styles tend to be items that carry over year to year
with only minor updates.

We believe the authenticity of our products is driven by a number of factors, including our solution-based design process,

use of technical materials, sophisticated manufacturing methods and innovative product features. Our products are sold at
competitive prices and are designed to offer superior performance with added features such as underarm panels for more
freedom of movement, triple-stitched seams for durability and mid-leg utility pockets for functionality. We also collaborate
with our suppliers to develop advanced fabrics that we sell under our trademarks. For example, we incorporate our DuluthFlex®
Fire Hose® cotton canvas into products to provide strength and abrasion resistance with stretch for freedom of movement.

Product Development

We are focused on developing apparel and gear that builds upon the Duluth Trading brand’s product heritage of “there’s
gotta be a better way,” resulting in distinctive products with enhanced features. Members of our product development team also
regularly read online customer product reviews, attend tradeshows and collaborate with our vendors, which facilitates new
product innovation. Our product development team incorporates all of this input to develop new product solutions and features,
ensure consistent fit, style and color and design functional and durable fabrics.

Marketing

Our marketing strategy is designed to build brand awareness, acquire new customers, enhance customer loyalty and drive

sales transactions. We are nationally known for our creative, irreverent and quirky advertising that features our Giant Angry
Beaver, Buck Naked Guy and Grab-Happy Grizzly characters to showcase our brand philosophy, humor and innovation. We
also feature testimonials in our marketing campaigns, which put our products in context, tying them to the individuals who
represent our core customer, who leads a hands-on lifestyle, values a job well-done and is often outdoors for work and hobbies.
We believe our customers identify with the inspiring stories of real men and women, recognize our products’ versatility and
appreciate the extreme and demanding conditions our products can withstand.

We pursue our marketing strategy through multiple forms of media, which gives our products an identity and enhances

our brand:

•

Digital and Email Marketing. We employ a variety of digital and online advertising strategies. These efforts
include display advertising, digital video advertising, search engine marketing and optimization and targeted email,
which we send to customers to introduce new products and offer promotions on select merchandise.

Television and Radio. We advertise in online video channels, streaming television, on cable and broadcast
television networks, as well as through streaming and on-demand audio channels to build brand awareness for both
men’s and women’s products and to reach a large, national audience. These advertisements feature both our

animated characters and female models, and are intended to be humorous, irreverent and quirky in order to grab the
viewer’s attention, while highlighting the particularly innovative, solution-based features of our core products and
the Duluth Trading name.

Social Media. We have an engaged social media community, which allows us to personally connect with our
customers online, and we believe further raises brand awareness. We maintain a social media presence on
Facebook, Instagram, Pinterest, YouTube and X (formerly known as Twitter).

Catalogs. Our catalogs are an important part of our heritage and represent a tangible vehicle for our authentic and
humorous storytelling.

E-Commerce. Our website is an integral part of our marketing strategy where we use humor and authentic
storytelling to engage our customers.

•

Customer Service

We are committed to providing outstanding customer service and believe in treating our customers like next-door
neighbors. Our retail stores are stocked with a comprehensive assortment of our products and staffed with knowledgeable and
well-trained sales associates. We stand behind all purchases with our “No Bull Guarantee.” Our call center is open for calls
from 5 A.M. to 1 A.M. Central Time, seven days a week and is staffed with friendly, knowledgeable representatives dedicated
to making every customer experience positive. As a convenience to our customers, we offer live chat through our website,
which is available from 7 A.M. to 8 P.M. Central Time on weekdays and 8 A.M. to 5 P.M. Central Time on weekends.

Manufacturing

We do not own or operate any manufacturing facilities. Instead, we arrange with third-party vendors for the

manufacturing of our merchandise. We have built strong, long-term relationships with our vendors. In fiscal 2023, 59% of our
purchases came from our largest supplier, an agent partner in Hong Kong who manages multiple factories across Asia and
Latin America, including Bangladesh, Cambodia, China, Egypt, Honduras, Indonesia, Mexico, Pakistan, and Vietnam.

Our sourcing strategy focuses on identifying and employing vendors that provide quality materials and fine craftsmanship

that our customers expect of our brand. To ensure that our high standards of quality and timely delivery of merchandise are
met, we work closely with our third-party partners. All of our products are produced according to our specifications, and we
require all of our manufacturers to adhere to strict regulatory compliance and standards of conduct. We seek to ensure the
consistent product quality by training Duluth Trading-certified factory auditors to selectively examine pre-production samples,
conduct periodic site visits to certain of our vendors’ production facilities and inspect inbound shipments at our fulfillment
centers.

Fulfillment Centers

We operate fulfillment centers located in Belleville, Wisconsin, Dubuque, Iowa, Salt Lake City, Utah and Adairsville,

Georgia. The approximate square footage of each facility is included in Item 2 of Part I of this report.

Information Technology

We use technology to provide customer service, business process support and business intelligence across our sales

channels. We continually aim to have more efficient supply chain and distribution systems operations. Our distributed order
management systems provide us with omnichannel capabilities that have a global view of available-to-promise inventory
management.

Competition

We operate primarily in the apparel, footwear and accessories industry, which is highly competitive. We compete with a

diverse group of direct-to-consumer companies and retailers, including men’s and women’s specialty apparel chains,
department stores, outdoor specialty stores, apparel catalog businesses and online apparel businesses. We compete principally
on the basis of brand recognition, innovation, product quality, customer service and price. To stay ahead of our competition, we
continue to develop innovative solution-based products for which we create unique selling propositions that incorporate humor
and storytelling.

Intellectual Property

Our trademarks are important to our marketing efforts. We own or have the rights to use certain trademarks, service
marks and trade names that are registered with the U.S. Patent and Trademark Office, trademark offices in other jurisdictions,

or exist under common law in the United States and other jurisdictions. The “Duluth Trading Co” trade name and trademark is
used both in the United States and internationally and is material to our business. Trademarks that are important in identifying
and distinguishing our products and services are AKHG®, Alaskan Hardgear® Armachillo®, Ballroom®, Buck Naked®, Bullpen®,
Cab Commander®, Crouch Gusset®, Dang Soft®, Dry on the Fly®, Duluth Trading Co®, DuluthFlex®, Fire Hose®, Flexpedition®,
Longtail T®, NoGA® ,No Polo Shirt®, No Yank®, Spit & Polish®, and Wild Boar®. Our rights to some of these trademarks may
be limited to select markets. We also own domain names, including “duluthtrading.com.”

Employees

As of January 28, 2024, we employed 950 full-time and 1,373 part-time and flexible part-time employees, 1,054 of which

were employed at our retail stores. The number of employees, particularly part-time employees, fluctuates depending upon
seasonal needs. Our employees are not represented by a labor union and are not party to a collective bargaining agreement. We
consider our relations with our employees to be good.

Seasonality

Our business experiences seasonal fluctuations. Our net sales and net income are generally highest in the fourth fiscal

quarter, which includes the holiday sales period. As a result, our quarterly operating results and working capital requirements
fluctuate significantly from quarter to quarter. Further, the impact of certain unusual or non-recurring items, economic
conditions, weather or other factors affecting our operations may vary from one year to the next.

Regulation and Legislation

We are subject to labor and employment laws, truth-in-advertising laws, privacy laws, safety regulations, consumer
protection regulations and other laws that regulate retailers and govern the promotion and sale of merchandise and the operation
of stores and warehouse facilities. We monitor changes in these laws and believe that we are in material compliance with
applicable laws.

Available Information

Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to

reports filed pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
are made available free of charge on or through our website at www.duluthtrading.com under the “Investors” tab as soon as
reasonably practicable after such reports are filed with, or furnished to the SEC.

ITEM 1A.

RISK FACTORS

Certain factors may have a material adverse effect on our business, financial condition and results of operations. You

should consider carefully the risks and uncertainties described below, in addition to other information contained in this Annual
Report on Form 10-K, including our financial statements and related notes. The risks and uncertainties described below are
not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not
material, may also become important factors that adversely affect our business. If any of the following risks actually occurs,
our business, financial condition, results of operations, and future prospects could be materially and adversely affected. In that
event, the trading price of our Class B common stock could decline, and you could lose part or all of your investment.

Strategic Risks

If we fail to offer products that customers want to purchase, our business and results of operations could be adversely

affected.

Our products must satisfy the desires of customers, whose preferences change over time. In order to be successful, we
must design, obtain and offer to customers innovative and high-quality products on a continuous and timely basis. Failure to
effectively respond to customer needs and preferences, or convey a compelling brand image or price-to-value equation to
customers may result in lower net sales and gross profit margins.

Our success depends in part on management’s ability to effectively anticipate or identify customer needs and preferences

and respond quickly with marketable product offerings in advance of the actual time of sale to the customer. Even if we are
successful in anticipating or identifying our customers’ needs and preferences, we must continue to develop and introduce
innovative, high-quality products and product features in response to changing consumer demand.

Factors that could affect our ability to accurately forecast consumer demand for our products include:

•

a failure in our solution-based design process to accurately identify the problems our customers are experiencing
with commonly available apparel and gear or a lack of customer acceptance of new products or product features we
design;

customer unwillingness to attribute premium value to our new products or product features we design relative to
the commonly available apparel and gear they were intended to replace;

new, well-received product introductions by competitors;

weak economic conditions or consumer confidence, which reduce demand for our products; and

terrorism, civil unrest or acts of war, or the threat thereof, which adversely affect consumer confidence and
spending and/or interrupt production and distribution of products and raw materials.

There can be no assurance that we will be able to successfully anticipate or identify our customers’ needs and preferences

and design products and product features in response. These risks could have a material adverse effect on our brand as well as
our results of operations and financial condition.

Our business depends on our ability to maintain strong brands and sub brands. We may not be able to maintain and
enhance the Duluth Trading brands if we receive unfavorable complaints, negative publicity or otherwise fail to live up to
consumers’ expectations, which could materially adversely affect our business, results of operations and growth prospects.

We currently offer a differentiated brand to our customers defined by solution-based products manufactured with high

quality craftsmanship, humorous and distinctive marketing, and an outstanding customer experience. Maintaining and
enhancing the Duluth Trading brand is critical to expanding our base of customers. If we fail to maintain our brand, or if we
incur excessive expenses in this effort, our business, operating results and financial condition may be materially adversely
affected. We anticipate that, as we raise our profile nationally and attract an increasing amount of competition, maintaining and
enhancing our brand may become increasingly difficult and expensive and may require us to make substantial additional
investments in areas such as marketing, store operations, merchandising, technology and personnel.

Customer complaints or negative reactions to, or unfavorable publicity about, our product quality or product features, our

storytelling or irreverent advertising, the shopping experience on our website or in our retail stores, product delivery times,
customer data privacy and security practices or customer support, especially on blogs, social media, other third-party websites
and our website, could rapidly and severely diminish consumer use of our website and catalogs, visits to our retail stores and
consumer confidence in us and result in harm to our brand. Furthermore, these factors could cause our customers to no longer

feel a personal connection with the Duluth Trading brand, which could result in the loss of customers and materially adversely
affect our business, results of operations and growth prospects.

We may face risks and challenges if we pursue further geographic expansion.

Our expansion into new geographic markets could result in increased competition and merchandising, distribution and

other challenges. We may encounter difficulties in attracting customers in our new retail store locations due to a lack of
customer familiarity with our brand, our lack of familiarity with local customer preferences, competition with new competitors
or with existing competitors with a large, established market presence and seasonal differences in the market. Our ability to
expand successfully into other geographic markets will depend on acceptance of our retail store experience by customers in
those markets, including our ability to design our stores in a manner that resonates locally and to offer the correct product
assortment to appeal to consumers in such markets. There can be no assurance that any newly opened stores will be received as
well as, or achieve net sales or profitability levels consistent with, our projected targets or be comparable to those of our
existing stores in the time periods estimated by us, or at all. If our stores fail to achieve, or are unable to sustain, acceptable net
sales and profitability levels, our business, results of operations and growth prospects may be materially adversely affected.

Furthermore, our retail stores may be located in regions that will be far from our Mount Horeb, Wisconsin headquarters

and will require additional management time and attention. Failure to properly supervise the operation and maintain the
consistency of the customer experience in those retail stores could result in loss of customers and potentially harm future net
sales prospects.

The success of our direct-to-consumer channel depends on customers’ use of our digital platform, including our website,

and response to digital marketing; if our overall marketing strategies are not successful, including our maintenance of a
robust customer list and ability to effectively customize our marketing efforts based on understanding customers
preferences, our business and results of operations could be materially adversely affected.

The level of customer traffic and volume of customer purchases through our direct-to-consumer channel is substantially

dependent on our ability to provide a content-rich and user-friendly website, a fun, easy and hassle-free customer experience
and reliable delivery of our products. If we are unable to maintain and increase customers’ use of our e-commerce platform,
including our website, and the volume of purchases decline, our business and results of operations could be adversely affected.

Customer response to our digital marketing is substantially dependent on merchandise assortment, merchandise
availability and creative presentation, as well as the selection of customers to whom our digital marketing is directed and our
catalogs are sent. Our maintenance of a robust customer list, which we believe includes desirable demographic characteristics
for the products we offer, has also been a key component of our overall strategy. If the performance of our website and email
declines, or if our overall marketing strategy is not successful, our business, results of operations and stock price could be
adversely affected.

If we fail to acquire new customers, or fail to do so in a cost-effective manner, we may not be able to increase net

revenue or profit per active customer.

Our success depends on our ability to acquire customers in a cost-effective manner. In order to expand our customer base,

we must appeal to and acquire customers who identify with the Duluth Trading brand. We have made significant investments
related to customer acquisition and expect to continue to spend significant amounts to acquire additional customers. For
example, our national television advertising campaigns are expensive and may not result in the cost-effective acquisition of
customers. Furthermore, as our brand has become more widely known in the market, our marketing campaigns have not
resulted in acquisition of new customers at the same rate as past campaigns, and this trend may continue in the future.

We also use other paid and non-paid advertising. Our paid advertising includes search engine marketing, display
advertising and paid social media. Our non-paid advertising efforts include search engine optimization, non-paid social media
and email. We obtain a significant amount of traffic via search engines and, therefore, rely on search engines such as Google,
Yahoo! and Bing. Search engines frequently update and change the logic that determines the placement and display of results
of a user’s search, such that the purchased or algorithmic placement of links to our sites can be negatively affected. Moreover, a
search engine could, for competitive or other purposes, alter its search algorithms or results, causing our sites to place lower in
search query results. A major search engine could change its algorithms in a manner that negatively affects our paid or non-paid
search ranking, and competitive dynamics could impact the effectiveness of search engine marketing or search engine
optimization. We also obtain a significant amount of traffic via social networking websites or other channels used by our
current and prospective customers. As e-commerce and social networking continue to rapidly evolve, we must continue to
establish relationships with these channels and may be unable to develop or maintain these relationships on acceptable terms.
Additionally, digital advertising costs may continue to rise and as our usage of these channels expands, such costs may impact
our ability to acquire new customers in a cost-effective manner. As usage of these channels by our customer base has not grown

as expected, we have suffered a decline in customer growth and net sales. A continued decrease in the level of usage or
customer growth may have a material adverse effect on our business, financial condition and operating results.

We cannot assure you that the net profit from new customers we acquire will ultimately exceed the cost of acquiring
those customers. If we fail to deliver an outstanding customer experience, or if consumers do not perceive the products we offer
to be manufactured with high quality craftsmanship, we may not be able to acquire new customers. If we are unable to acquire
new customers, our growth prospects may be materially adversely affected.

If we cannot compete effectively in the apparel, footwear and accessories industry, our business and results of operations

may be adversely affected.

The apparel, footwear and accessories industry is highly competitive. We compete with a diverse group of direct-to-
consumer companies and retailers, including men’s and women’s specialty apparel chains, outdoor specialty stores, apparel
catalog businesses and online apparel businesses that sell competing lines of merchandise. Our competitors may be able to
adopt more aggressive pricing policies, adapt to changes in customers’ needs and preferences more quickly, devote greater
resources to the design, sourcing, distribution, marketing and sale of their products or generate greater national brand
recognition than us. In addition, as our business continues to expand, our competitors may seek to increase efforts to imitate our
product designs, which could adversely affect our business and results of operations. An inability to overcome these potential
competitive disadvantages or effectively market our products relative to our competitors could have an adverse effect on our
business and results of operations.

We may engage in strategic transactions that could negatively impact our liquidity, increase our expenses and present

significant distractions to management.

We may consider strategic transactions and business arrangements, including, but not limited to, acquisitions, asset
purchases, partnerships, joint ventures, restructurings and investments. Any such transaction may require us to incur non-
recurring or other charges, may increase our near and long-term expenditures and may pose significant integration challenges or
disrupt our management or business, which could harm our operations and financial results.

If we fail to achieve our growth strategy, our business, financial condition and operating results could be harmed.

To achieve our growth strategy, we must continue to implement our operational plans and strategies, improve and expand

our infrastructure of people, information systems and facilities and expand, train and manage our employee base. To support
continued growth, we must effectively integrate, develop and motivate a large number of employees. Failure to improve and
expand our infrastructure of employees may have a material adverse effect on our business, financial condition and operating
results.

Additionally, the growth strategy of our business places significant demands on our management and other employees.

The growth of our business may require significant additional resources to meet these daily demands, which may not scale in a
cost-effective manner or may negatively affect the quality of our website, retail stores, fulfillment centers, call center and other
aspects of the customer experience. We are also required to manage relationships with a growing number of suppliers,
customers and other third parties. Our information technology systems and our internal controls and procedures may not be
adequate to support future growth of these relationships. If we are unable to achieve the growth strategy of our organization,
our business, financial condition and operating results may be materially adversely affected.

Operational Risks

Economic uncertainties may continue to adversely affect our business operations, store and website traffic, employee

availability, financial condition, liquidity, and cash flow for an extended period of time.

The ongoing economic uncertainty continues to affect our business operations and it is impossible to predict the effect and

ultimate impact of ongoing economic uncertainties.

Business activities continue to face economic uncertainties, including but not limited to increased inflation and interest

rates and global supply chain constraints. The economic uncertainties may continue for an extended period and have adversely
impacted, and may continue to impact, our business.

As inflationary periods continue, consumer fear may adversely affect traffic to our stores and website. Reductions in
customer visits to, and spending at, our stores and website caused by economic uncertainties have resulted in a loss of retail
store sales and profits and other material adverse effects. The extent of the impact on our business, financial results, liquidity
and cash flows will depend largely on future developments, all of which are highly uncertain and cannot be predicted.

These and other potential impacts of economic uncertainties could therefore materially and adversely affect our business,

financial condition and results of operations.

We rely on sources for merchandise located in foreign markets, and our business may therefore be adversely affected by

legal, regulatory, economic and political risks associated with international trade and those markets.

Our reliance on suppliers in foreign markets creates risks inherent in doing business in foreign jurisdictions, including:

•

transportation delays and interruptions, including due to port congestion and the failure of suppliers or distributors
to comply with import regulations;

the burdens of complying with a variety of foreign laws and regulations, including trade and labor restrictions,
import/export laws and regulations, and local intellectual property laws and rights owned by third parties;

changes in U.S. and non-U.S. laws (or changes in the enforcement of those laws) affecting the importation and
taxation of goods, including disallowance of tax deductions for imported merchandise, imposition of unilateral
tariffs on imported goods, duties, quotas, enhanced security measures at U.S. ports or imposition of new legislation
relating to import quotas;

economic and political instability in the countries and regions where our suppliers are located;

compliance with U.S. and other country laws relating to foreign operations, including the Foreign Corrupt Practices
Act, which prohibits U.S. companies from making improper payments to foreign officials for the purpose of
obtaining or retaining business;

increases in shipping, labor, fuel, travel and other transportation costs;

the imposition of anti-dumping or countervailing duty proceedings resulting in the potential assessment of special
anti-dumping or countervailing duties;

political instability, war and acts of terrorism; and

the occurrence of a natural disaster, unusual weather conditions, or prolonged public health crises, epidemics or
pandemics in foreign countries from which we source our products.

The occurrence of one or more of these events could result in disruptions to our operations, which in turn could increase

our cost of goods sold, decrease our gross profit, or impact our ability to deliver to our customers.

New initiatives may be proposed in the United States that may have an impact on the trading status of certain countries
and may include retaliatory duties or other trade sanctions that, if enacted, would increase the cost of products purchased from
suppliers in such countries with which we do business. Any inability on our part to rely on our foreign sources of production
due to any of the factors listed above could have an adverse effect on our business, results of operations and financial condition.

If we fail to timely and effectively obtain shipments of products from our suppliers and deliver merchandise to our

customers, our business and operating results could be adversely affected.

We do not own or operate any manufacturing facilities and therefore depend upon independent third-party suppliers for

the manufacture of our merchandise. We cannot control all of the various factors that might affect timely and effective
procurement of supplies of product from our third-party suppliers and delivery of merchandise to our customers. A majority of
the products that we purchase must be shipped to our fulfillment centers in Wisconsin, Iowa, Georgia and Utah. While our
reliance on a limited number of fulfillment centers provides certain efficiencies, it also makes us more vulnerable to natural
disasters, weather-related disruptions, accidents, system failures, public health pandemics, or other unforeseen causes that could
delay or impair our ability to fulfill customer orders and/or ship merchandise to our stores, which could adversely affect sales.
Our ability to mitigate the adverse impacts of these events depends in part upon the effectiveness of our disaster preparedness
and response planning, as well as our business continuity planning. Our use of imports also makes us vulnerable to risks
associated with products manufactured abroad, including, among other things, risks of damage, destruction or confiscation of
products while in transit to a fulfillment center or at points of export or import, organized labor strikes and work stoppages,
transportation and other delays in shipments, including as a result of heightened security screening and inspection processes or
other port-of-entry limitations or restrictions in the United States, unexpected or significant port congestion, lack of freight
availability and freight cost increases. In addition, as has happened in the past, if we experience a shortage of a popular item,
we may be required to arrange for additional quantities of the item, if available, to be delivered through airfreight, which is
significantly more expensive than standard shipping by sea. We may not be able to obtain sufficient freight capacity on a timely
basis or at favorable shipping rates and, therefore, may not be able to receive merchandise from suppliers or deliver products to
customers in a timely and cost-effective manner.

Competitive pricing pressures with respect to shipping our products to our customers may harm our business and results

of operations.

Given the size of our direct-to-consumer net sales relative to our total net sales, shipping and handling revenue has had a

significant impact on our gross profit and gross profit margin. Historically, this revenue has partially offset our shipping and
handling expense included in selling, general and administrative expenses. Online and omnichannel retailers are increasing
their focus on delivery services, with customers increasingly seeking faster, guaranteed delivery times and low-price or free
shipping. Higher direct-to-consumer net sales has resulted and may continue to result in additional peak surcharges assessed by
our delivery partners. To remain competitive, we have been required to offer discounted, free or other more competitive
shipping options to our customers, which has resulted in declines in our shipping and handling revenue and increased shipping
and handling expense. We expect further declines in shipping and handling revenues as compared to prior years. Further
declines in shipping and handling revenues may have a material adverse effect on our gross profit and gross profit margin, as
well as our Adjusted EBITDA to the extent there are not commensurate declines, or if there are increases, in our shipping and
handling expense.

We rely on third-party service providers to deliver products purchased through our direct-to-consumer channel to our

customers and our business could be negatively impacted by disruptions in the operations of these third-party service
providers.

Relying on third-party service providers puts us at risk from disruptions in their operations, such as employee strikes,
inclement weather and their inability to meet our shipping demands. Our efforts to mitigate the impact of future thresholds may
not be successful or may result in similar surcharges. Moreover, we may be unable to obtain terms as favorable as those
received from the transportation providers we currently use, which would further increase our costs. In addition, if our products
are not delivered to our customers on time, our customers may cancel their orders or we may lose business from these
customers in the future. We may be subject to shipping surcharges and thresholds during the peak holiday shopping season,
which may have a negative impact on our earnings. These factors may negatively impact our financial condition and results of
operations.

Dependence on our e-commerce sales channel subjects us to numerous risks that could have a material adverse effect on

our business, financial condition and results of operations.

Our results of operations and financial condition are dependent on maintaining our e-commerce business and expanding

our e-commerce business is an important part of our growth strategy. Dependence on our e-commerce business and its
continued growth subjects us to certain risks, including:

•

diversion of traffic from our stores;

liability for online content;

the need to keep pace with rapid technological change;

government regulation of the Internet, including taxation; and

threats to the computer systems that operate our website and related support systems, including viruses, malware
and other malicious code, misconfiguration, systems failure or inadequacy, compromise or unauthorized access and
similar disruptions.

Our failure to successfully respond to these risks and uncertainties could reduce our e-commerce sales, increase our costs,

diminish our growth prospects, and damage our brand and reputation, which could negatively impact our business, financial
condition and results of operations.

Increases in the price of raw materials, fuel and labor, or their reduced availability, could increase our cost of goods and

cause delays.

The price and availability of raw materials may fluctuate substantially, depending on a variety of factors, including
demand, acreage devoted to cotton crops and crop yields, weather patterns, supply conditions, transportation costs, energy
prices, work stoppages, government regulation and government policy, economic climates, market speculation and other
unpredictable factors. Fluctuations in the price and availability of fuel, labor and raw materials, such as cotton, could affect our
cost of goods and an inability to mitigate these cost increases, unless sufficiently offset with our pricing actions, might cause a
decrease in our profitability, while any related pricing actions might cause a decline in our sales volume. Additionally, any
decrease in the availability of raw materials could impair our ability to meet our production or purchasing requirements in a
timely manner. Both the increased cost and lower availability of merchandise, raw materials, fuel and labor may have an
adverse impact on our cash flow and working capital needs as well as those of our suppliers.

We rely upon third-party land-based and air freight carriers for merchandise shipments from our fulfillment centers to
customers and our retail stores. Accordingly, we are subject to the risks, including labor disputes, union organizing activity,
inclement weather and increased transportation costs, associated with such carriers’ ability to provide delivery services to meet
outbound shipping needs. In addition, if the cost of fuel rises, the cost to deliver merchandise from fulfillment centers to
customers and our retail stores may rise and, although some of these costs are paid by our customers, such costs could have an
adverse impact on our profitability. Failure to procure suppliers of products from our third-party suppliers and deliver
merchandise to customers and our retail stores in a timely, effective and economically viable manner could damage our
reputation and adversely affect our business. In addition, any increase in distribution costs and expenses could adversely affect
our future financial performance.

If our key suppliers or service providers were unable or unwilling to provide the products and services we require, our

business could be adversely affected.

Our products are sourced through third-party purchasing agents and a variety of domestic and international suppliers. If

these suppliers are unable or unwilling to provide the products or services that we require or materially increase their costs, our
ability to offer and deliver our products on a timely and profitable basis could be impaired, which could have a material adverse
effect on our business, financial condition and results of operations. We cannot assure that any or all of our relationships will
not be terminated or that such relationships will continue as presently in effect. Furthermore, if any of our significant suppliers
were to become subject to bankruptcy, receivership or similar proceedings, customs actions, or other legal actions, we may be
unable to arrange for alternate or replacement relationships on terms as favorable as our current terms, which could adversely
affect our sales and operating results.

Our growth strategy is influenced by the willingness and ability of our suppliers to efficiently manufacture our products
in a manner that is consistent with our standards for quality and value. If we cannot obtain a sufficient amount and variety of
quality products at acceptable prices, it could have a negative impact on our competitive position. This could result in lower
revenue and decreased customer interest in our product offerings, which, in turn, could adversely affect our business and results
of operations. Our arrangements with our suppliers are generally not exclusive. As a result, our suppliers might be able to sell
similar or identical products to certain of our competitors, some of which purchase products in significantly greater volume.
Our competitors may enter into arrangements with suppliers that could impair our ability to obtain our products from those
suppliers, including by requiring suppliers to enter into exclusive arrangements, which could limit our access to such
arrangements or products.

We rely on third parties to provide us with services in connection with certain aspects of our business, and any failure by

these third parties to perform their obligations could have an adverse effect on our business and results of operations.

We have entered into agreements with third parties for logistics services, information technology systems (including
hosting our website), operating our call center during certain hours, software development and support, catalog production,
select marketing services, processing gift card activity, distribution and packaging and employee benefits. Services provided by
any of our third-party suppliers could be interrupted as a result of many factors, such as acts of nature or contract disputes. Any
failure by a third party to provide us with services for which we have contracted on a timely basis or within service level
expectations and performance standards could result in a disruption of our business and have an adverse effect on our business
and results of operations.

Inventory shrinkage could have a material adverse effect on our business, financial condition and results of operations.

We are subject to the risk of inventory loss and theft. Although our inventory shrinkage rates have not been material, or
fluctuated significantly in recent years, we cannot assure you that actual rates of inventory loss and theft in the future will be
within our estimates or that the measures we are taking will effectively reduce the problem of inventory shrinkage. Although
some level of inventory shrinkage is an unavoidable cost of doing business, if we were to experience higher rates of inventory
shrinkage or incur increased security costs to combat inventory theft, it could have a material adverse effect on our business,
financial condition and results of operations.

We are subject to data security and privacy risks that could negatively affect our results, operations or reputation.

In the normal course of business we often collect, retain and transmit customer personal and credit card information,
employee personal information, and other sensitive and confidential information. The protection of customer and employee
information, and the Company’s intellectual property, from potential threats is vitally important to the Company. Consumers
and employees continue to have significant concerns about the security of personal information, especially when transmitted
over the Internet, and the use, retention, disclosure, and privacy of such information. We continually evaluate and upgrade our
information systems, security measures, and practices to combat the ever-evolving cyber risks and to comply with our legal and
regulatory obligations, and we provide cybersecurity awareness training around phishing, social engineering, and other cyber

risks to our employees, in an effort to elevate our cybersecurity posture and give our workforce the skills to both avoid and
report cyber threats. Despite our risk management efforts, vendor due diligence, and security measures, our facilities and
systems and those of our third-party service providers, are subject to increasingly complex cyber risks, including cyber
extortion, data breaches, unauthorized access, denial of service, vendor or employee misconduct, ransomware and other
malicious software, and data exfiltration. We and our employees and customers could suffer significant harm if any personal,
financial, or credit card information was accessed or disclosed by an unauthorized third party, or our information technology
systems or those of our third party providers were compromised or subject to data loss, exfiltration, corruption, or disruption.
Any security incident or data breach could severely damage our reputation and our relationships with customers, business
partners and employees, cause us to incur significant costs and expenses to investigate, remediate and notify affected
individuals, and expose us to an increased risk of litigation, regulatory enforcement, fines and penalties, and other losses and
liabilities. In addition, the media and public scrutiny of information security and privacy has become more intense and the
regulatory environment has become more complex and uncertain due to recent high-profile privacy and security incidents and
legislative efforts across the globe. As a result, we may incur significant costs to comply with laws regarding the use, retention,
disclosure, security, and privacy of personal information.

We rely significantly on information technology, and any inadequacy, interruption, integration failure or security failure

of this technology could harm our ability to effectively operate our business.

Our ability to effectively manage and operate our business depends significantly on information technology systems. We

rely heavily on information technology to track sales and inventory and manage our supply chain. We are also dependent on
information technology, including the Internet, for our direct-to-consumer sales, including our e-commerce and catalog
operations and retail business credit card transaction authorization. Despite our preventative efforts, our systems and those of
our third-party service providers may be vulnerable to damage or interruption. The failure of these systems to operate
effectively, problems with transitioning to upgraded or replacement systems, difficulty in integrating new systems or systems of
acquired businesses or a breach of security of these systems could adversely impact the operations of our business, including
disruption of our ability to accept and fulfill customer orders, effective management of inventory, inefficient ordering and
replenishment of products, e-commerce operations, retail business credit card transaction authorization and processing,
corporate email communications and our interaction with the public on social media.

Our failure to retain our executive management team and to attract qualified new personnel could adversely affect our

business and results of operations.

We depend on the talents and continued efforts of our executive management team. The loss of members of our executive
management may disrupt our business and adversely affect our results of operations. Furthermore, our ability to manage further
expansion will require us to continue to attract, motivate and retain additional qualified personnel. We believe that having an
executive management team with qualified personnel who are passionate about our brand, have extensive industry experience
and have a strong customer service ethic has been an important factor in our historical success, and we believe that it will
continue to be important to growing our business. Competition for these types of personnel is intense, and we may not be
successful in attracting, integrating and retaining the personnel required to grow and operate our business profitably.

An inability to attract and retain qualified employees to meet our staffing needs in our corporate office, stores,

fulfillment centers or call center could result in higher payroll costs and adversely affect our operating results.

Our performance is dependent on attracting and retaining a large number of qualified employees. Many of our strategic

initiatives require that we hire and/or develop associates with appropriate experience. Attracting and retaining a sufficient
number of qualified employees to meet our staffing needs may be difficult, because the competition for these types of personnel
is intense. Many of our staffing needs in our stores, fulfillment centers and call center are entry-level or part-time positions with
historically high rates of turnover. If we cannot attract and retain employees with the qualifications we deem necessary to meet
our staffing needs in our corporate office, stores, fulfillment centers and call center, our ability to effectively operate may be
adversely affected. In addition, our staffing needs are especially high during the peak holiday season. We cannot be sure that
we will be able to attract and retain a sufficient number of qualified personnel in future periods.

Our business is seasonal, and if we do not efficiently manage inventory levels, our results of operations could be

adversely affected.

Our business is subject to seasonal influences, with increased net sales and net income realized during the fourth quarter

of our fiscal year, which includes the holiday season.

We must maintain sufficient inventory levels to operate our business successfully, but we must also avoid accumulating

excess inventory, which increases working capital needs and potentially lowers gross margins. We obtain substantially all of
our inventory from suppliers located outside the United States. Some of these suppliers often require lengthy advance notice of

order requirements in order to be able to manufacture and supply products in the quantities requested. This usually requires us
to order our products, and enter into commitments for the purchase of our products, well in advance of the time these products
will be offered for sale. As a result, it may be difficult to respond to changes in customer demand. If we do not accurately
anticipate the future demand for a particular product or the time it will take to obtain new inventory, inventory levels will not be
appropriate and our results of operations could be adversely affected.

We expect a disproportionate amount of our net sales to occur during our fourth quarter. If we do not stock or restock

popular products in amounts sufficient to meet customer demand, it could significantly affect our revenue and our future
growth. If we overstock products, we may be required to take significant inventory markdowns or write-offs and incur
commitment costs, which could reduce profitability. We may experience an increase in our net shipping cost due to
complimentary upgrades, split-shipments and additional long-zone shipments necessary to ensure timely delivery for the
holiday season. Furthermore, if too many customers access our website within a short period of time due to increased holiday
demand, we may experience system interruptions that could make our website unavailable or prevent us from efficiently
fulfilling orders, which may reduce the volume of products we sell as well as the attractiveness of our product offerings. In
addition, we or our third-party service providers may be unable to adequately staff our fulfillment and customer service centers
during these peak periods, and our delivery service providers and other fulfillment companies may be unable to meet the peak
seasonal demand.

As a result of holiday sales, inventories, accounts payable and borrowings under our revolving line of credit typically

reach their highest levels in October or November of each year (other than as a result of cash flow provided by or used in
investing and financing activities). Inventories, accounts payable and borrowings under our revolving line of credit then
typically decline steadily during the holiday season, resulting in our cash typically reaching its highest level, and borrowings
under our revolving line of credit reaching their lowest level, typically near December 31 of each year.

Financial Risks

Our net sales and profits depend on the level of consumer spending for apparel, footwear and accessories, which is
sensitive to general economic conditions and other factors. An economic recession or a decline in consumer spending could
have a material adverse effect on our business and results of operations.

The apparel, footwear and accessories industry has historically been subject to cyclical variations and is particularly

affected by adverse trends in the general economy. The success of our business depends on consumer spending. There are a
number of factors that influence consumer spending, including actual and perceived economic conditions, disposable consumer
income, interest rates, inflation, consumer credit availability, unemployment, stock market performance, extreme weather
conditions, energy prices and tax rates in the national, regional and local markets where we sell our products. A decline in
actual or perceived economic conditions or other factors could negatively impact the level of consumer spending and have a
material adverse impact on our business and results of operations.

We are subject to payment-related risks.

We accept payments using a variety of methods, including credit cards, debit cards, Paypal, gift cards and physical bank
checks. For existing and future payment methods we offer to our customers, we may become subject to additional regulations
and compliance requirements (including obligations to implement enhanced authentication processes that could result in
increased costs and reduce the ease of use of certain payment methods), as well as fraud. For certain payment methods,
including credit and debit cards, we pay interchange and other fees, which may increase over time, raising our operating costs
and lowering profitability. We rely on third-party service providers for payment processing services, including the processing
of credit and debit cards. In each case, it could disrupt our business if these third-party service providers suffer a data breach, or
become unwilling or unable to provide these services to us. We are also subject to payment card association operating rules,
including data security rules, certification requirements and rules governing electronic funds transfers, which could change or
be reinterpreted to make it difficult or impossible for us to comply. If we fail to comply with these rules or requirements, or if
our systems containing payment information are breached or compromised, we may be liable for card issuing banks’ costs,
subject to fines and higher transaction fees and/or lose our ability to accept credit and debit card payments from our customers
and process electronic funds transfers or facilitate other types of payments, and our business and operating results could be
adversely affected.

We depend on cash generated from our operations to support our growth, which could strain our growth.

We primarily rely on cash flow generated from our direct-to-consumer and retail store sales and borrowings under our
credit facility to fund our current operations and our growth initiatives. As we expand our business, we will need significant
amounts of cash to pay our existing and future lease obligations, purchase inventory, pay personnel and invest in our
infrastructure and facilities. If our business does not generate sufficient cash flow from operations to fund these activities and

sufficient funds are not otherwise available from our existing revolving credit facility or future credit facilities, we may need
additional equity or debt financing. If such financing is not available to us on satisfactory terms, our ability to operate and
expand our business or to respond to competitive pressures would be limited and we could be required to delay, curtail or
eliminate planned investments and other activities. Moreover, if we raise additional capital by issuing equity securities or
securities convertible into equity securities, your ownership may be diluted. Any debt financing we may incur may impose on
us covenants that restrict our operations and will require interest payments that would create additional cash demands and
financial risk for us.

We may be unable to accurately forecast our operating results and growth rate.

We may not be able to accurately forecast our operating results and growth rate. We use a variety of factors in our
forecasting and planning processes, including historical results, recent history and assessments of economic and market
conditions, among other things. The growth rates in net sales and profitability that we forecast may not be achieved. The
growth of our sales and profitability depends on the growth of demand for the products we offer, and our business is affected by
general economic and business conditions. A softening of demand, whether caused by changes in customer preferences or a
weakening of the economy or other factors, may result in decreased net sales. In addition, we experience seasonal trends in our
business, and this variability may make it difficult to predict net sales and could result in significant fluctuations in our
operating results from period to period. Furthermore, most of our expenses and investments are fixed, and we may not be able
to adjust our spending in a timely manner to compensate for any unexpected shortfall in our net sales results. Failure to
accurately forecast our operating results and growth rate could cause our actual results to be materially lower than anticipated,
and if our growth rates decline as a result, investors’ perceptions of our business may be adversely affected, and the market
price of our Class B common stock could decline.

Our failure to comply with restrictive covenants under our revolving credit facility and other debt instruments could

trigger prepayment obligations.

Our failure to comply with the restrictive covenants under our revolving credit facility and other debt instruments could
result in an event of default, which, if not cured or waived, could result in us being required to repay these borrowings before
their due date. If we are forced to refinance these borrowings on less favorable terms, our results of operations and financial
condition could be adversely affected by increased costs and rates.

Legal, Tax, Compliance, Reputation and Other Risks

We may be subject to increased labor costs due to external factors, including changes in laws and regulations, and we

may be subject to unionization, work stoppages or slowdowns.

Our ability to meet our labor needs while controlling costs is subject to external factors such as unemployment levels,

prevailing wage rates, minimum wage legislation, actions by our competitors with respect to compensation levels and changing
demographics. Currently none of our employees are represented by a union, but our employees have the right to be under the
National Labor Relations Act. Changes that adversely impact our ability to meet our labor needs in a cost-effective manner
could adversely affect our operating results. In addition, the employer mandate provisions of the Patient Protection and
Affordable Health Care Act (the “PPACA”), changes in regulations under the PPACA, changes in federal and state minimum
wage laws and other laws and regulations relating to employee benefits could cause us to incur additional wage and benefit
costs, which could negatively impact our business, financial condition and results of operations.

Unseasonal or severe weather conditions may adversely affect our merchandise sales.

Our business is adversely affected by unseasonal weather conditions. Sales of certain seasonal apparel items, especially
outerwear, are dependent in part on the weather and may decline in years in which weather conditions do not favor the use of
these products. Sales of our spring and summer products, which traditionally consist of lighter weight clothing, are adversely
affected by cool or wet weather. Similarly, sales of our fall and winter products, which are traditionally weighted toward
outerwear, are adversely affected by mild, dry or warm weather. Severe weather events may impact our ability to supply our
retail stores, deliver orders to customers on schedule and staff our retail stores, fulfillment centers and call center, which could
have an adverse effect on our business and results of operations.

Our product designs are not protected by substantial intellectual property rights.

Due to the rapid pace of change in the apparel, footwear and accessories industry, the length of time it takes to obtain

patents and the expense and uncertainty of obtaining patent protection, we have not taken steps to obtain patent protection for
many of our innovative product designs. Competitors have attempted to copy our product designs in the past, and we expect
that if we are able to raise our national profile, our products may be subject to greater imitation by existing and new

competitors. If we are not able to continue rapid innovation of new products and product features, our brand may be harmed
and our results of operations may be materially adversely affected.

If we are unable to protect or preserve our brand image and our proprietary rights, our business may be adversely

affected.

We regard our trademarks, copyrights, trade secrets and similar proprietary rights as critical to our success. As such, we

rely on trademark and copyright law, trade secret protection and confidentiality agreements with our associates, consultants,
suppliers and others to protect our proprietary rights. Nevertheless, the steps we take to protect our proprietary rights may be
inadequate and we may experience difficulty in effectively limiting the unauthorized use of our trademarks and other
intellectual property worldwide. Unauthorized use of our trademarks, copyrights, trade secrets or other intellectual property
rights may cause significant damage to our brand and our ability to effectively represent ourselves to agents, suppliers, vendors,
licensees and/or customers. While we intend to enforce our intellectual property rights, there can be no assurance that we are
adequately protected in all countries or that we will prevail when defending our trademark and proprietary rights. If we are
unable to protect or preserve the value of our trademarks, copyrights or other intellectual property rights for any reason, or if we
fail to maintain our brand image due to merchandise and service quality issues, actual or perceived, adverse publicity,
governmental investigations or litigation or other reasons, our brand and reputation could be damaged and our business may be
adversely affected.

We may be subject to liability if we infringe upon the intellectual property rights of third parties.

Third parties may sue us for alleged infringement of their proprietary rights or use intellectual property rights to interfere

with or attempt to interfere with the manufacture of products for us or the supply of products to us. The party claiming
infringement might have greater resources than we do to pursue its claims, and we could be forced to incur substantial costs and
devote significant management resources to defend against such litigation. If the party claiming infringement were to prevail,
we could be forced to discontinue the use of the related trademark or design and/or pay significant damages or enter into
expensive royalty or licensing arrangements with the prevailing party, assuming these royalty or licensing arrangements are
available at all on an economically feasible basis, which they may not be. We could also be required to pay substantial
damages. Such infringement claims could harm the Duluth Trading brand. In addition, any payments we are required to make
and any injunction we are required to comply with as a result of such infringement could adversely affect our financial results.

If our independent suppliers do not use ethical business practices or comply with applicable regulations and laws, our

reputation could be materially harmed and our business and results of operations may be adversely affected.

Our reputation and customers’ willingness to purchase our products depend in part on our suppliers’ compliance with

ethical employment practices, such as with respect to child labor, wages and benefits, forced labor, discrimination, freedom of
association, unlawful inducements, safe and healthy working conditions and with all legal and regulatory requirements relating
to the conduct of their business. While we operate compliance and monitoring programs to promote ethical and lawful business
practices, we do not exercise ultimate control over our independent suppliers or their business practices and cannot guarantee
their compliance with ethical and lawful business practices. Violation of labor or other laws by our suppliers, or the divergence
of a supplier’s labor practices from those generally accepted as ethical in the United States, could materially hurt our reputation,
which could have an adverse effect on our business and results of operations.

We may be subject to assessments for additional taxes, including sales taxes, which could adversely affect our business.

In accordance with current law, we pay, collect and/or remit taxes in those states where we or our subsidiary, as
applicable, maintain a physical presence. While we believe that we have appropriately remitted all taxes based on our
interpretation of applicable law, tax laws are complex and their application differs from state to state. It is possible that some
taxing jurisdictions may attempt to assess additional taxes and penalties on us or assert either an error in our calculation, a
change in the application of law or an interpretation of the law that differs from our own, which may, if successful, adversely
affect our business and results of operations.

An increasing number of states have considered or adopted laws that attempt to impose tax collection obligations on out-

of-state companies. Additionally, the Supreme Court of the United States ruled in South Dakota v. Wayfair, Inc. et al, or
Wayfair, that online sellers can be required to collect sales and use tax despite not having a physical presence in the buyer’s
state. In response to Wayfair, or otherwise, states or local governments have adopted, or begun to enforce, laws requiring us to
calculate, collect and remit taxes on sales in their jurisdictions. A successful assertion by one or more states requiring us to
collect taxes where we presently do not do so, or to collect more taxes in a jurisdiction in which we currently do collect some
taxes, could result in substantial tax liabilities, including taxes on past sales, as well as penalties and interest. The imposition by
state governments or local governments of sales tax collection obligations on out-of-state sellers could also create additional

administrative burdens for us and decrease our future sales, which could have an impact on our business, financial condition
and results of operations.

We may become involved in a number of legal proceedings and audits, and outcomes of such legal proceedings and

audits could adversely affect our business, financial condition and results of operations.

Our business requires compliance with many laws and regulations, including labor and employment, customs, truth-in-

advertising, consumer protection and zoning and occupancy laws and ordinances that regulate retailers generally and/or govern
the importation, promotion and sale of merchandise and the operation of stores and warehouse facilities. Failure to achieve
compliance could subject us to lawsuits and other proceedings, and could also lead to damage awards, fines and penalties. We
may become involved in a number of legal proceedings and audits including government and agency investigations, and
consumer, employment, tort and other litigation. We cannot predict with certainty the outcomes of these legal proceedings and
other contingencies. The outcome of some of these legal proceedings, audits and other contingencies could require us to take,
or refrain from taking, actions which could negatively affect our operations or require us to pay substantial amounts of money
adversely affecting our financial condition and results of operations. Additionally, defending against these lawsuits and
proceedings may be necessary, which could result in substantial costs and diversion of management’s attention and resources,
causing a material adverse effect on our business, financial condition and results of operations. There can be no assurance that
any pending or future legal proceedings and audits will not have a material adverse effect on our business, financial condition
and results of operations.

Changes to accounting rules or regulations could significantly affect our financial results.

Our consolidated financial statements are prepared in accordance with U.S. GAAP. New accounting rules or regulations

and changes to existing accounting rules or regulations have occurred and may occur in the future. Future changes to
accounting rules or regulations could negatively affect our results of operations and financial condition through increased
compliance costs.

Risks Related to Ownership of our Class B Common Stock

The dual class structure of our common stock and the existing ownership of common stock by our executive officers,
directors and their affiliates have the effect of concentrating voting control with our executive officers, directors and their
affiliates for the foreseeable future, which will limit your ability to influence corporate matters.

Our Class A common stock has ten votes per share, and our Class B common stock has one vote per share. Given the
greater number of votes per share attributed to our Class A common stock, our Chairman, Stephen L. Schlecht, who through his
voting trust is our only Class A shareholder, beneficially owns shares representing more than 50% of the voting power of our
outstanding capital stock. As a result of our dual class ownership structure, Mr. Schlecht will be able to exert a significant
degree of influence or actual control over our management and affairs and over matters requiring shareholder approval,
including the election of directors, a merger, consolidation or sale of all or substantially all of our assets and any other
significant transaction. Mr. Schlecht together with our other executive officers, directors and their affiliates, owns shares
representing the majority of the voting power of our outstanding capital stock. This concentrated control will limit your ability
to influence corporate matters for the foreseeable future. For example, these shareholders will be able to control elections of
directors, amendments of our articles of incorporation or bylaws, increases to the number of shares available for issuance under
our equity incentive plans or adoption of new equity incentive plans and approval of any merger or sale of assets for the
foreseeable future. This control may materially adversely affect the market price of our Class B common stock.

Additionally, the holder of our Class A common stock may cause us to make strategic decisions or pursue acquisitions

that could involve risks to you or may not be aligned with your interests. The holder of our Class A common stock will also be
entitled to a separate vote in the event we seek to amend our articles of incorporation in a manner that alters or changes the
powers, preferences or special rights of the Class A common stock in a manner that affects its holder adversely.

We are a controlled company within the meaning of the NASDAQ rules, and as a result, we rely on exemptions from

certain corporate governance requirements that provide protection to shareholders of other companies.

Mr. Schlecht controls more than 50% of the total voting power of our common stock, and we are considered a controlled
company under the NASDAQ corporate governance listing standards. As a controlled company, certain exemptions under the
NASDAQ listing standards exempt us from the obligation to comply with certain NASDAQ corporate governance
requirements, including the requirements:

•

that a majority of our board of directors consist of independent directors, as defined under the rules of NASDAQ;

•

that we have a nominating committee that is composed entirely of independent directors with a written charter
addressing the committee’s purpose and responsibilities; and

that we have a compensation committee that is composed entirely of independent directors with a written charter
addressing the committee’s purpose and responsibilities.

Although we have a majority of independent directors on our board, we are a controlled company. As such, there is no

guarantee that we will not take advantage of this exemption in the future. Accordingly, as long as we are a controlled company,
holders of our Class B common stock may not have the same protections afforded to shareholders of companies that are subject
to all of the NASDAQ corporate governance requirements.

Our stock price may be volatile or may decline regardless of our operating performance, resulting in substantial losses

for investors.

The market price of our Class B common stock may fluctuate significantly in response to numerous factors, many of

which are beyond our control, including:

•

actual or anticipated fluctuations in our results of operations, particularly in our growth rates and margins;

the financial projections we may provide to the public, any changes in these projections or our failure to meet these
projections;

failure of securities analysts to initiate or maintain coverage of our company, changes in financial estimates or
ratings by any securities analysts who follow our company or our failure to meet these estimates or the expectations
of investors;

announcements by us or our competitors of significant technical innovations, acquisitions, strategic partnerships,
joint ventures, operating results or capital commitments;

changes in operating performance and stock market valuations of other retail companies generally, or those in our
industry in particular;

price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole;

changes in our board of directors or management;

sales of large blocks of our Class B common stock, including sales by our executive officers, directors and
significant shareholders;

lawsuits threatened or filed against us;

changes in laws or regulations applicable to our business;

changes in our capital structure, such as future issuances of debt or equity securities;

short sales, hedging and other derivative transactions involving our capital stock;

general economic conditions in the United States and abroad; and

other events or factors, including those resulting from pandemics, war, incidents of terrorism or responses to these
events.

In addition, stock markets have experienced extreme price and volume fluctuations that have affected and continue to

affect the market prices of equity securities of many retail and e-commerce companies. Stock prices of many retail companies
and e-commerce companies have fluctuated in a manner unrelated or disproportionate to the operating performance of those
companies. In the past, shareholders have instituted securities class action litigation following periods of market volatility. If
we were to become involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of
management from our business and materially adversely affect our business, financial condition and operating results.

A material weakness in our system of internal control over financial reporting was identified.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting and for

evaluating and reporting on the effectiveness of our system of internal control. As a public company, we are required by
Section 404 of the Sarbanes-Oxley Act to evaluate the effectiveness of our internal control over financial reporting, beginning
with this Annual Report on Form 10-K for the year ended January 28, 2024. We must also include a report issued by our
independent registered public accounting firm based on their audit of our internal controls over financial reporting.

In connection with our assessment of internal control over financial reporting for the fiscal year, we determined that we

did not maintain effective internal control over financial reporting because the Company did not perform effective risk

assessment related to the mapping of general ledger accounts to the consolidated financial statements resulting in manual
controls in the financial reporting process that were not designed to sufficiently mitigate the risk of incorrect presentation of
certain general ledger accounts in the consolidated financial statements. While the control deficiency did not result in a material
misstatement to the consolidated financial statements, there is a reasonable possibility that a material misstatement of our
consolidated financial statements may not have been prevented or detected on a timely basis. We have initiated the appropriate
steps to remediate the control deficiency contributing to the material weakness to ensure these controls are designed,
implemented and operating effectively.

The occurrence of, or failure to remediate, a material weakness and any future material weaknesses in our internal control

over financial reporting or determination that our disclosure controls and procedures are ineffective may have other
consequences that could materially and adversely affect our business, including an adverse impact on the market price of our
common stock, potential actions or investigations by regulatory authorities, adverse legal action by stakeholders, or a loss of
investor confidence and damage to our reputation.

If securities or industry analysts do not publish research or reports about our business, or publish negative reports about

our business, our share price and trading volume could decline.

The trading market for our Class B common stock will depend in part on the research and reports that securities or

industry analysts publish about us or our business, our market and our competitors. We do not have any control over these
analysts. If one or more of the analysts who cover us downgrade our shares or change their opinion of our shares, our share
price would likely decline. If one or more of these analysts cease coverage of our company or fail to regularly publish reports
on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline.

The requirements of being a public company may strain our resources, divert management’s attention and affect our

ability to attract and retain additional executive management and qualified board members.

As a public company, we are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the
Dodd-Frank Wall Street Reform and Consumer Protection Act, the listing requirements of the NASDAQ Global Select Market
and other applicable securities rules and regulations. Compliance with these rules and regulations increase our legal and
financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems
and resources. The Exchange Act requires, among other things, that we file annual, quarterly and current reports with respect to
our business and results of operations. The Sarbanes-Oxley Act requires, among other things, that we maintain effective
disclosure controls and procedures and internal control over financial reporting. In order to maintain and, if required, improve
our disclosure controls and procedures and internal control over financial reporting, significant resources and management
oversight may be required. As a result, management’s attention may be diverted from other business concerns, which could
materially adversely affect our business and results of operations.

In addition, changing laws, regulations and standards relating to corporate governance and public disclosure are creating

uncertainty for public companies, increasing legal and financial compliance costs and making some activities more time-
consuming. These laws, regulations and standards are subject to varying interpretations, in many cases due to their lack of
specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and
governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by
ongoing revisions to disclosure and governance practices. We intend to invest resources to comply with evolving laws,
regulations and standards, and this investment may result in increased general and administrative expenses and a diversion of
management’s time and attention from revenue-generating activities to compliance activities. If our efforts to comply with new
laws, regulations and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related
to their application and practice, regulatory authorities may initiate legal proceedings against us, and our business may be
materially adversely affected.

As a result of disclosure of information in this annual report and in filings required of a public company, our business and

financial condition will become more visible, which we believe may result in threatened or actual litigation, including by
competitors and other third parties. If such claims are successful, our business and results of operations could be materially
adversely affected, and even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and
resources necessary to resolve them, could divert the resources of our management and materially adversely affect our business,
financial condition and operating results.

Anti-takeover provisions in our charter documents and under Wisconsin law could make an acquisition of our company
more difficult, limit attempts by our shareholders to replace or remove our current management and limit the market price
of our Class B common stock.

Provisions in our amended and restated articles of incorporation and amended and restated bylaws may have the effect of
delaying or preventing a change of control or changes in our management. In addition to the dual class structure of our common
stock, our amended and restated articles of incorporation and amended and restated bylaws include provisions that:

•

permit the board of directors to establish the number of directors and fill any vacancies and newly created
directorships;

authorize the issuance of “blank check” preferred stock that our board of directors could use to implement a
shareholder rights plan;

provide that the board of directors is expressly authorized to make, alter or repeal our bylaws; and

establish advance notice requirements for nominations for election to our board of directors or for proposing
matters that can be acted upon by shareholders at annual or special shareholder meetings.

These provisions may frustrate or prevent any attempts by our shareholders to replace or remove our current management

by making it more difficult for shareholders to replace members of our board of directors, which is responsible for appointing
the members of our management. In addition, because we are incorporated in Wisconsin, the Wisconsin control share
acquisition statute and Wisconsin’s “business combination” provisions would apply and limit the ability of an acquiring person
to engage in certain transactions or to exercise full voting power of acquired shares under certain circumstances. As a result,
offers to acquire us, which may represent a premium over the available market price of our Class B common stock, may be
withdrawn or otherwise fail to be realized.

ITEM 1B.

UNRESOLVED STAFF COMMENTS

None.

ITEM 1C.

CYBERSECURITY

We believe cybersecurity is critical to advancing our “Big Dam Blueprint” vision and recognize the importance of

assessing, identifying and managing material risks associated with cybersecurity threats defined in Item 106(a) of Regulation
S-K. These risks include, among others described in our risk factor disclosures in Item 1A of this Annual Report on Form 10-
K: operational risks, fraud, harm to employees or customers and violation of data privacy or security laws. These cybersecurity
risks make it necessary that we expend extensive assets on cybersecurity.

Cybersecurity Governance

Our audit committee of our board of the directors is formally charged with oversight of cybersecurity risk. This

includes reviewing the Company’s cybersecurity and other information technology risks, controls and procedures, including
high-level review of the threat landscape facing the Company and the Company’s strategy to mitigate cybersecurity risks and
potential breaches, and the Company’s plan to respond to data breaches.

Identifying and assessing our cybersecurity risk is integrated into our overall risk management systems and processes.

As part of our program, our internal audit team facilitates an annual risk assessment that includes assessing cybersecurity and
other technology risks. The results are shared with the board of directors during a regular board meeting. In addition, a
quarterly cyber risk assessment process run by our information technology team, including our chief technology officer, is
shared with the audit committee. The chair of the audit committee reports on significant cybersecurity updates to the full board
of directors during executive sessions of our quarterly meetings. Our audit committee members also engage in conversations
throughout the year with management on cybersecurity events and discuss any updates to our cybersecurity processes, systems
and programs.

Our cybersecurity risk management processes are overseen by leaders from our information technology, compliance
and legal teams. Our chief technology officer has over 30 years of experience leading information technology organizations.
Other individual leaders within these teams have on average over 20 years of experience in roles involving information
technology, including security and compliance.

Cybersecurity Risk Management and Strategy

We have implemented several measures to identify and assess our cybersecurity threats. We self-assess maturity levels
along with areas of risk for the cyber kill chain using the ISO/IEC 33004:2015 Process Maturity Model. Within this model, our
risk dashboard is continually assessed based on eight key initiatives: reconnaissance, intrusion, exploitation, privilege escalation,
lateral movement, obfuscation/anti-forensics, denial of service and exfiltration. Along with this model, we engage and utilize
various third parties to measure risk profiles of ourselves and vendors, security threats specific to our Company both internal and
external through multiple avenues such as website and social media and perform periodic penetration tests to identify
cybersecurity risks and threats to the Company. These evaluations include testing both the design and operational effectiveness
of security controls. We recognize a cybersecurity incident experienced by a supplier or vendor could materially impact us. We
assess third party cybersecurity controls as part of our third-party information technology risk when integrating new tools or third
parties. We contractually require third parties to report cybersecurity incidents to us so we can assess the impact of the incident
and any necessary regulatory reporting obligations that may be required. Additionally, as part of the contract management process,
new information technology vendors are subject to a cybersecurity review by the information technology team and include
cybersecurity and data privacy language, if applicable, in contracts.

Training of employees, utilization of incident response plans, payment card industry audits, and SOX testing are all

processes by which we seek to prevent, detect, mitigate and remediate cybersecurity incidents. In the event of a security or data
incident, the impact is evaluated, ranked by severity, and prioritized for remediation. Incidents deemed to have a moderate or
higher business impact, even if immaterial to the Company, are reported to the audit committee.

Notwithstanding our risk management efforts related to cybersecurity, we may not be successful in preventing or

mitigating a cybersecurity incident that could have a material or other adverse effect on us. See Item 1A. “Risk Factors” for a
discussion of our information technology and cybersecurity risks.

In fiscal 2023, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to

materially affect our business strategy, results of operations or financial condition.

ITEM 2.

PROPERTIES

The following table sets forth the location, primary use and size of our leased and owned facilities as of January 28, 2024.

Location

North East

Connecticut
Maine
Massachusetts
New Jersey
Pennsylvania
Rhode Island

Midwest
Illinois
Indiana
Iowa
Kansas
Michigan
Minnesota
Missouri
Nebraska
North Dakota
Ohio
South Dakota
Wisconsin

South

Alabama
Arkansas
Florida
Georgia
Kentucky
North Carolina
Oklahoma
Tennessee
Texas
Virginia

West

Alaska
Colorado
Oregon
Utah
Washington

Mount Horeb, WI
Belleville, WI
Oshkosh, WI
Red Wing, MN
Mount Horeb, WI
Kowloon, Hong Kong
Belleville, WI
Dubuque, IA
Adairsville, GA
Salt Lake City, UT

Number of Stores

Primary Use

Gross Sq Ft

Leased/Owned

Retail Stores

1
1
1
2
2
1

3
1
1
1
3
4
2
1
1
4
1
4

2
1
1
1
2
2
1
2
6
2

1
3
2
1
1

Store
Store
Store
Store
Store
Store

Store
Store
Store
Store
Store
Store
Store
Store
Store
Store
Store
Store

Store
Store
Store
Store
Store
Store
Store
Store
Store
Store

Store
Store
Store
Store
Store

Other

Photo Studio
Outlet store
Outlet store
Outlet store
Corporate headquarters
Office
Fulfillment center
Fulfillment center
Fulfillment center
Fulfillment center

9,792
12,951
16,360
24,741
34,945
14,528

38,410
14,557
12,249
15,385
45,588
61,900
27,692
15,757
14,557
58,420
9,166
53,246

31,312
15,656
14,557
20,041
28,582
41,672
15,536
27,325
92,212
31,828

25,409
52,643
39,463
15,602
15,656

7,000
17,890
12,777
15,560
108,000
1,855
220,000
216,000
494,144
228,800

Leased
Leased
Leased
Leased
Leased
Leased

Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased

Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased
Leased

Leased
Leased
Leased
Leased
Leased

Leased
Owned
Leased
Leased
Leased
Leased
Owned
Leased
Leased
Leased

The leases on our retail stores expire at various times and are subject to renewal options and rent escalation provisions.

We consider these properties to be in good condition and believe that our facilities are adequate for our operations and provide
sufficient capacity to meet our anticipated requirements.

ITEM 3.

LEGAL PROCEEDINGS

From time to time, we are subject to certain legal proceedings and claims in the ordinary course of business. We are not

presently party to any legal proceedings the resolution of which we believe would have a material adverse effect on our
business, financial condition, operating results or cash flows. We establish reserves for specific legal matters when we
determine that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable.

ITEM 4.

MINE SAFETY DISCLOSURES

Not applicable.

Information about our Executive Officers

The following is a list of names and ages of executive officers of Duluth Trading indicating all positions and offices held

by each such person and each such person’s principal occupation(s) or employment during the past five years. Officers are
appointed annually by the Board of Directors at the meeting of directors immediately following the annual meeting of
shareholders. There are no family relationships among any officers or director, except as disclosed below, arrangements or
understandings between any officer and any other person pursuant to which the officer was selected. The information presented
below is as of March 22, 2024.

Name
Samuel M. Sato

Age Office
60 Mr. Sato was appointed to our Board of Directors in May 2021, and since that time has

served as President and Chief Executive Officer. He previously served as the Chief
Executive Officer of The Finish Line, Inc., from February 2016 to February 2019, and also
served on the Board of Directors of The Finish Line, Inc. from October 2014 to February
2019. Mr. Sato previously served as President of The Finish Line, Inc. from October 2014
to February 2016, President, Finish Line Brand, from October 2012 to October 2014, and
President and Chief Merchandising Officer from October 2010 to September 2012, as well
as The Finish Line, Inc.’s Executive Vice President, Chief Merchandising Officer from to
March 2007 to October 2010. Mr. Sato began his career in 1985 at Nordstrom Inc., where
he held various leadership roles within merchandising. Mr. Sato has been involved in the
retail industry for over 30 years.

Heena K. Agrawal

48 Ms. Agrawal has served as our Senior Vice President and Chief Financial Officer since

February 2024. Ms. Agrawal previously served as the Chief Financial Officer, Global
Wrangler and Global Kontoor Supply Chain of Kontoor Brands, Inc. from January 2023 to
January 2024, and Chief Financial Officer of Global Wrangler from September 2021 to
January 2024. Prior to that, Ms. Agrawal served as the Global Segment Chief Financial
Officer, Industrial Segment for Underwriters Laboratories from February 2021 to
September 2021, and Connected Technology Appliances & Lighting Global Division Chief
Financial Officer for Underwriters Laboratories from October 2019 to February 2021, as
well as various leadership positions at Walgreens Boots Alliance from January 2012 to
September 2019, most recently serving as Synergy Leader M&A Integration: Rite Aid from
2018 to September 2019 and at Procter & Gamble from 2001 to 2011. Ms. Agrawal holds a
Bachelor of Commerce, Accounting, and Taxation degree from Narsee Monjee College of
Commerce and Economics and an M.B.A. from Indiana University Kelley School of
Business. Ms. Agrawal has been involved in the retail industry for over 20 years.

Albert J. Sutera

57 Mr. Sutera has served as our Senior Vice President, Chief Technology Officer and Logistics

since August 2022. Mr. Sutera previously served as the Chief Technology Officer of JD
Sports Fashion / Finish Line from March 2016 through August 2021, where Mr. Sutera
oversaw the company’s information and technology functions and digital operational
solutions. Before that, Mr. Sutera served as the Chief Technology Officer for the Hudson’s
Bay Company from 2013 to 2016 and Chief Technology Officer & Digital Operations for
Saks Fifth Avenue from 2007 to 2013. Earlier in his career, he held senior technology roles
with companies including JetBlue Airways, Liberty Travel / GOGO Worldwide Vacations,
Volvo North America, and General Electric.

David S. Homolka

57 Mr. Homolka has served as our Senior Vice President of Talent, DE&I, and Retail

Operations since February 2020 and previously served as our Vice President of Human
Resources, Store Operations and Asset Protection from January 2019 to February 2020, and
Vice President of Human Resources from February 2017 to January 2019. Mr. Homolka
previously served as Chief Property and Design Officer and Vice President of Real Estate,
Store Design and Construction at Cabela’s from October 2015 to February 2017 and Vice
President of Human Resources and Asset Protection from January 2012 to October 2015.

Richard W. Schlecht

43 Mr. Schlecht has served as our Senior Vice President of Product Development and

Sourcing since October 2023, and has previously served as our Senior Vice President of
Product, Merchandise and Inventory from March 2022 to October 2023, Senior Vice
President of Product, Visual and Creative from February 2020 to March 2022, Vice
President of Product Development from March 2016 to February 2020 and Director of
Product Development from September 2013 to March 2016. Mr. Schlecht holds a BSBA

degree with a minor in Statistics from Denver University. Mr. Schlecht is the son of
Stephen L. Schlecht, the Chairman of the Board of Directors of Duluth Holdings Inc.

Neala K. Shepherd

47 Ms. Shepherd has served as our Senior Vice President of Brand and Marketing since

October 2023, serving as caretaker of the brand and voice of customer experience across all
facets of the Company. She previously served as our Senior Vice President of Customer
Experience from March 2022 to October 2023, Vice President of Merchandising and
Marketing from May 2020 to March 2022 and Vice President of Marketing from February
2019 to May 2020. Prior to joining Duluth Trading, she served as Senior Director of
Marketing for The Buckle, a leading specialty retailer in fashion apparel, from October
2017 to 2019. Previously, she spent 15 years at Cabela’s in a variety of leadership roles
across marketing, advertising, creative and brand, most recently serving as Senior Director
of Marketing from September 2015 to October 2017. She earned a B.S. degree in
Communications / Marketing from Oklahoma Christian University in 1999.

PART II

ITEM 5.

MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND
ISSUER PURCHASES OF EQUITY SECURITIES

Common Stock Listing and Trading

Our Class B common stock has been traded on the NASDAQ Global Select Market under the symbol “DLTH,” since our

initial public offering on November 19, 2015. Our Class A common stock is neither listed nor traded on an exchange.

Shareholders of Record

As of March 5, 2024, there were approximately 107 holders of record, based upon data provided by our transfer agent, of
our Class B common stock, one of whom is the sole holder of our Class A common stock. We believe the number of beneficial
holders of the Company’s Class B common stock is in excess of this amount.

Dividends

Our Class B common stock began trading on November 19, 2015. Since that time, we have not declared any cash

dividends, and we do not anticipate declaring any cash dividends in the foreseeable future.

Securities Authorized for Issuance Under Equity Compensation Plans

Information required by this Item concerning our Equity Compensation Plan Information is set forth in our definitive
proxy statement for our 2024 annual meeting of shareholders to be held on May 23, 2024 (the “Proxy Statement”) under the
caption “Proposal Four: Approval of the 2024 Equity Incentive Plan of Duluth Holdings, Inc.”, and is incorporated herein by
reference.

ITEM 6.

[RESERVED]

ITEM 7.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

The following discussion and analysis of the financial condition and results of operations should be read in conjunction
with the consolidated financial statements and the accompanying notes and information contained in other sections included
elsewhere in this annual report, particularly, “Risk Factors,” and “Business.” This discussion and analysis is based on the
beliefs of our management, as well as assumptions made by, and information currently available to our management. The
statements in this discussion and analysis concerning expectations regarding our future performance, liquidity and capital
resources, as well as other non-historical statements in this discussion and analysis, are forward-looking statements. See
“Forward-Looking Statements.” These forward-looking statements are subject to numerous risks and uncertainties, including
those described under “Risk Factors.” Our actual results could differ materially from those suggested or implied by any
forward-looking statements.

Management’s discussion focuses on fiscal 2023 results compared to fiscal 2022. Fiscal year 2023 and 2022 were 52-

week periods. For a discussion of fiscal 2022 results compared to fiscal 2021, refer to the Company’s Annual Report on Form
10-K for the year ended January 29, 2023.

Overview

We are a lifestyle brand of men’s and women’s workwear, casual wear, outdoor apparel and accessories sold primarily
through our own omnichannel platform. We offer products nationwide through our website and catalog. In 2010, we initiated
our omnichannel platform with the opening of our first store. Since then, we have expanded our retail presence, and as of
January 28, 2024, we operated 62 retail stores and three outlet stores.

We offer a comprehensive line of innovative, durable and functional products, such as our Longtail T® shirts, Buck

Naked® underwear, Fire Hose® work pants and No-Yank® Tank, which reflect our position as the Modern, Self-Reliant
American Lifestyle brand. Our brand has a heritage in workwear that transcends tradesmen and appeals to a broad demographic
for everyday and on-the-job use.

From our heritage as a catalog for those working in the building trades, Duluth Trading has become a widely recognized

brand and proprietary line of innovative and functional apparel and gear. Over the last decade, we have created strong brand
awareness, built a loyal customer base and generated robust sales momentum. We have done so by sticking to our roots of
“there’s gotta be a better way” and through our relentless focus on providing our customers with quality, functional products.

A summary of our financial results is as follows:

•

Net sales in fiscal 2023 decreased by 1.0% over the prior year to $646.7 million;

Net loss in fiscal 2023 was ($9.4) million compared to prior year net income of $2.2 million; and

Adjusted EBITDA in fiscal 2023 decreased 23.2% over the prior year to $33.4 million.

See “Reconciliation of Net (Loss) Income to EBITDA and EBITDA to Adjusted EBITDA” section for a reconciliation of

our net loss to EBITDA and EBITDA to Adjusted EBITDA, both of which are non-U.S. GAAP financial measures. See also
the information under the heading “Adjusted EBITDA” in the section “How We Assess the Performance of Our Business” for
our definition of Adjusted EBITDA.

Our management’s discussion and analysis includes market sales metrics for our stores, website and catalog sales. Market

areas are determined by a third-party that divides the United States and Puerto Rico into 280 unique geographical areas. Our
store market sales metrics include sales from our stores, website and catalog. Our non-store market sales metrics include sales
from our website, catalog and orders placed through the call center.

Economic Conditions

The United States economy has experienced high inflation during 2022 and 2023 and there are expectations in the market

that inflation may remain at elevated levels.

The ultimate impact of higher inflationary periods and efforts to control inflation on our operational and financial
performance still depends on future developments outside of our control. Given the uncertainty, we cannot reasonably estimate
store traffic patterns and the prolonged impact on overall consumer demand.

How We Assess the Performance of Our Business

In assessing the performance of our business, we consider a variety of financial and operating measures that affect our

operating results.

Net Sales

Net sales reflect our sale of merchandise plus shipping and handling revenue collected from our customers, less returns

and discounts. Direct-to-consumer sales are recognized upon shipment to a customer, while store sales are recognized at the
point of sale.

Gross Profit

Gross profit is equal to our net sales less cost of goods sold. Gross profit as a percentage of our net sales is referred to as

gross margin. Cost of goods sold includes the direct cost of purchased merchandise; inventory shrinkage; inventory adjustments
due to obsolescence, including excess and slow-moving inventory and lower of cost and net realizable reserves; inbound
freight; and freight from our fulfillment centers to our retail stores. The primary drivers of the costs of individual goods are raw
material costs. Depreciation and amortization are excluded from gross profit. Shipping and handling revenue is also reflected in
our gross profit and gross profit margin. Our gross profit may not be comparable to other retailers, as we do not include
distribution network and store occupancy expenses in calculating gross profit, but instead we include them in selling, general
and administrative expenses.

Selling, General and Administrative Expenses

Selling, general and administrative expenses include all operating costs not included in cost of goods sold. These
expenses include all payroll and payroll-related expenses and occupancy expenses related to our stores and to our operations at
our headquarters, including utilities, depreciation and amortization. They also include marketing expense, which primarily
includes television, digital and social media advertising, catalog production, mailing and print advertising costs, as well as all
logistics costs associated with shipping product to our customers, consulting and software expenses and professional services
fees. Selling, general and administrative expenses as a percentage of net sales is usually higher in lower-volume quarters and
lower in higher-volume quarters because a portion of the costs are relatively fixed.

While we expect these expenses to increase as we continue to increase brand awareness and invest in infrastructure to
support our business, we believe these expenses will decrease as a percentage of sales over time. Our shipping and handling
expenses typically increase during the second half of the year due to additional surcharges during our peak selling season.

Adjusted EBITDA

We believe Adjusted EBITDA is a useful measure of operating performance, as it provides a clearer picture of operating
results by excluding the effects of financing and investing activities by eliminating the effects of interest and depreciation costs
and eliminating expenses that are not reflective of underlying business performance. We use Adjusted EBITDA to facilitate a
comparison of our operating performance on a consistent basis from period-to-period and to provide for a more complete
understanding of factors and trends affecting our business.

We define Adjusted EBITDA as consolidated net (loss) income before depreciation and amortization, interest expense

and provision for income taxes adjusted for the impact of certain items, including non-cash and other items we do not consider
representative of our ongoing operating performance. We believe Adjusted EBITDA is less susceptible to variances in actual
performance resulting from depreciation, amortization and other items. This non-GAAP measure may not be comparable to
similarly titled measures used by other companies.

Free Cash Flow

We believe Free Cash Flow is a useful measure of performance as an indication of our financial strength and provides

additional perspective on our ability to efficiently use capital in executing our growth strategy. We use Free Cash Flow to
facilitate a comparison of our operating performance on a consistent basis from period-to-period and our ability to generate
cash.

We define Free Cash Flow as net cash provided by operating activities less purchase of property and equipment. This

non-GAAP measure may not be comparable to similarly titled measures used by other companies.

Results of Operations

The following table summarizes our consolidated results of operations for the periods indicated, both in dollars and as a

percentage of net sales.

(in thousands)
Net sales
Cost of goods sold (excluding depreciation and amortization)
Gross profit
Selling, general and administrative expenses
Operating (loss) income
Interest expense
Other income, net
(Loss) income before income taxes
Income tax (benefit) expense
Net (loss) income
Less: Net income (loss) attributable to noncontrolling interest
Net (loss) income attributable to controlling interest
Percentage of Net sales:
Net sales
Cost of goods sold (excluding depreciation and amortization)
Gross profit
Selling, general and administrative expenses
Operating (loss) income
Interest expense
Other income, net
(Loss) income before income taxes
Income tax (benefit) expense
Net (loss) income
Less: Net income (loss) attributable to noncontrolling interest
Net (loss) income attributable to controlling interest

Fiscal 2023 Compared to Fiscal 2022

Net Sales

Fiscal Year Ended

January 28, 2024

January 29, 2023

646,681
321,710
324,971
333,804
(8,833)
4,156
923
(12,066)
(2,693)
(9,373)
(17)
(9,356)

100.0 %
49.7 %
50.3 %
51.6 %
(1.4)%
0.6 %
0.1 %
(1.9)%
(0.4)%
(1.4)%
— %
(1.4)%

653,307
309,872
343,435
337,204
6,231
3,653
376
2,954
708
2,246
(58)
2,304

100.0 %
47.4 %
52.6 %
51.6 %
1.0 %
0.6 %
— %
0.5 %
0.1 %
0.3 %
— %
0.3 %

Net sales decreased $6.6 million, or 1.0%, to $646.7 million in fiscal 2023 compared to $653.3 million in fiscal 2022.

Store market net sales decreased $11.4 million, or 2.5%, to $445.1 million in fiscal 2023 compared to $456.5 million in

fiscal 2022. Net sales in non-store markets increased $4.4 million, or 2.3%, to $196.0 million in fiscal 2023 compared to $191.6
million in fiscal 2022.

Gross Profit

Gross profit decreased $18.5 million, or 5.4%, to $325.0 million in fiscal 2023 compared to $343.4 million in fiscal 2022.

As a percentage of net sales, gross margin decreased to 50.3% of net sales in fiscal 2023 compared to 52.6% of net sales in
fiscal 2022. The decrease in gross margin rate was primarily due to a lower mix of full price sales as customers purchasing
activity increased during periods of promotions.

Selling, General and Administrative Expenses

Selling, general and administrative expenses decreased $3.4 million, or 1.0%, to $333.8 million in fiscal 2023 compared
to $337.2 million in fiscal 2022. Selling, general and administrative expenses as a percentage of net sales was 51.6% in fiscal
2023 and fiscal 2022.

Interest Expense

Interest expense increased $0.5 million to $4.2 million in fiscal 2023 compared to $3.7 million in fiscal 2022. The

increase in interest expense was primarily attributable to increased interest rates on outstanding debt in fiscal 2023 compared to
fiscal 2022.

Income Taxes

Income tax benefit was $2.7 million in fiscal 2023 compared to income tax expense of $0.7 million in fiscal 2022. Our

effective tax rate related to controlling interest was 22.4% in fiscal 2023 compared to 23.5% in fiscal 2022.

Net (Loss) Income Attributable to Controlling Interest

Net loss attributable to controlling interest was ($9.4) million in fiscal 2023 compared to net income attributable to

controlling interest of $2.3 million in fiscal 2022, due to the factors discussed above.

Non-GAAP Financial Measures

See the above section titled “How We Assess the Performance of Our Business,” for our definition of Adjusted EBITDA

and Free Cash Flow.

Reconciliation of Net (Loss) Income to EBITDA and EBITDA to Adjusted EBITDA

The following table represents reconciliations of net (loss) income to EBITDA and EBITDA to Adjusted EBITDA for the

periods indicated below.

(in thousands)
Net (loss) income

Depreciation and amortization
Amortization of internal-use software hosting
subscription implementation costs
Interest expense
Income tax (benefit) expense

EBITDA (non-GAAP)

Stock based compensation

Adjusted EBITDA (non-GAAP)

Fiscal Year Ended

January 28, 2024

January 29, 2023

(9,373)
32,159

4,961
4,156
(2,693)
29,210
4,195
33,405

2,246
30,810

3,392
3,653
708
40,809
2,711
43,520

As a result of the factors discussed above in the “Results of Operations” section, Adjusted EBITDA decreased $10.1

million, or 23.2%, to $33.4 million in fiscal 2023 compared to $43.5 million in fiscal 2022. As a percentage of net sales,
Adjusted EBITDA decreased to 5.2% of net sales in fiscal 2023 compared to 6.7% of net sales in fiscal 2022.

Free Cash Flow

The following table represents a reconciliation of Net cash provided by operating activities, the most comparable U.S.

GAAP financial measure, to free cash flow.

(in thousands)
Net cash provided by (used in) operating activities

Purchases of property and equipment

Free Cash Flow (non-GAAP)

Fiscal Year Ended

January 28, 2024

January 29, 2023

38,673
(49,086)
(10,413)

(1,396)
(27,065)
(28,461)

Free cash flow increased $18.0 million to ($10.4) million in fiscal 2023 compared to ($28.5) million in fiscal 2022. The

increase was primarily driven by lower inventory levels, partially offset by higher purchases of property and equipment.

Liquidity and Capital Resources

General

Our business relies on cash from operating activities and a credit facility as our primary sources of liquidity. Our primary

cash needs have been for inventory, marketing and advertising, payroll, store leases, and capital expenditures associated with
infrastructure and information technology. The most significant components of our working capital are cash, inventory,
accounts payable and other current liabilities. As of January 28, 2024 our working capital was $78.5 million, which includes
cash and cash equivalents of $32.2 million.

We spent $53.2 million in fiscal 2023 on capital expenditures, inclusive of investments in software hosting

implementation costs, which are included in Prepaid expenses & other current assets on the Company’s Consolidated Balance
Sheets. We expect to spend approximately $25.2 million in fiscal 2024 on capital expenditures. Due to the seasonality of our
business, a significant amount of cash from operating activities is generated during the fourth quarter of our fiscal year. During
the first three quarters of our fiscal year, we typically are net users of cash in our operating activities as we acquire inventory in
anticipation of our peak selling season, which typically occurs in the fourth quarter of our fiscal year. We also use cash in our
investing activities for capital expenditures throughout all four quarters of our fiscal year.

We believe that our cash flow from operating activities and the availability of cash under our credit facility will be

sufficient to cover working capital requirements and anticipated capital expenditures for the foreseeable future.

Cash Flow Analysis

A summary of operating, investing and financing activities is shown in the following table.

(in thousands)
Net cash provided by (used in) operating activities
Net cash used in investing activities
Net cash used in financing activities
Decrease in cash and cash equivalents

Fiscal Year Ended

January 28, 2024

January 29, 2023

38,673
(48,718)
(3,346)
(13,391)

(1,396)
(26,873)
(3,234)
(31,503)

Net Cash Provided by (Used in) Operating Activities

Operating activities consist primarily of net (loss) income adjusted for non-cash items that include depreciation and

amortization, stock-based compensation and the effect of changes in assets and liabilities.

For fiscal 2023, net cash provided by operating activities was $38.7 million, which primarily consisted of non-cash
depreciation and amortization of $32.2 million, amortization of stock-based compensation of $4.2 million and cash provided by
operating assets and liabilities of $13.7 million, which was partially offset by net loss of ($9.4) million. The cash provided by
operating assets and liabilities of $13.7 million primarily consisted of a $29.2 million decrease in inventory partially offset by a
$5.4 million and $5.1 million decrease in trade accounts payable and accrued expenses, respectively.

For fiscal 2022, net cash used in operating activities was $1.4 million, which primarily consisted of net income of $2.2
million, non-cash depreciation and amortization of $30.8 million, amortization of stock-based compensation of $2.7 million,
which was offset by cash used in operating assets and liabilities of $37.2 million. The cash used in operating assets and
liabilities of $37.2 million primarily consisted of a $32.3 million increase in inventory, primarily due to the pull forward of
spring receipts, and a $11.8 million decrease in accrued expenses, partially offset by a $12.7 million increase in trade accounts
payable.

Net Cash Used in Investing Activities

Investing activities consist primarily of capital expenditures related to a new fulfillment center and information

technology.

For fiscal 2023, net cash used in investing activities was $48.7 million, driven by purchases of property and equipment of

$49.1 million, primarily related to the Adairsville, Georgia fulfillment center.

For fiscal 2022, net cash used in investing activities was $26.9 million, driven by purchases of property and equipment of

$27.1 million, primarily related to the Adairsville, Georgia fulfillment center.

Net Cash Used in Financing Activities

Financing activities consist primarily of borrowings and payments related to our revolving line of credit and other long-

term debt, as well as payments on finance lease obligations.

For fiscal 2023 and fiscal 2022, net cash used in financing activities was $3.3 million and $3.2 million, respectively,

primarily consisting of payments on finance lease obligations.

Credit Agreement

On May 14, 2021, the Company terminated its prior credit agreement, and entered into a credit agreement (the “Credit

Agreement”), which was treated as a modification for accounting purposes. The Credit Agreement originally matured on May
14, 2026 and provided for borrowings of up to $150.0 million that were available under a revolving senior credit facility, with a
$5.0 million sublimit for issuance of standby letters of credit, as well as a $10.0 million sublimit for swing line loans. At the
Company’s option, the interest rate applicable to the revolving senior credit facility was a floating rate equal to: (i) the
Bloomberg Short-Term Bank Yield Index rate (“BSBY”) plus the applicable rate of 1.25% to 2.00% determined based on the
Company’s rent adjusted leverage ratio, or (ii) the base rate plus the applicable rate of 0.25% to 1.00% based on the Company’s
rent adjusted leverage ratio. The Credit Agreement is secured by essentially all Company assets and requires the Company to
maintain compliance with certain financial and non-financial covenants, including a maximum rent adjusted leverage ratio and
a minimum fixed charge coverage ratio as defined in the Credit Agreement.

On July 8, 2022, the Company entered into the First Amendment to the Credit Agreement (the “First Amendment”),

which was treated as a modification for accounting purposes. The First Amendment amends the Credit Agreement in order to
(i) increase the revolving commitment from $150.0 million to $200.0 million; (ii) extend the maturity date from May 14, 2026
to July 8, 2027; (iii) amend the pricing index to replace BSBY with the Term Secured Overnight Financing Rate; and (iv)
reduce the commitment fee in some instances. As of and for the fiscal year ended January 28, 2024, we were in compliance
with all financial and non-financial covenants.

Contractual Obligations

In connection with our investing and operating activities, we have entered into certain contractual obligations. See

Note 3 “Leases” of Notes to Consolidated Financial Statements for additional discussion of these obligations.

Off-Balance Sheet Arrangements

We are not a party to any significant off-balance sheet arrangements.

Critical Accounting Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States
requires management to make estimates and assumptions that affect amounts reported in our consolidated financial statements
and related notes, as well as the related disclosure of contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period. We evaluate our accounting policies, estimates, and
judgments on an on-going basis. We base our estimates and judgments on historical experience and various other factors that
are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different
assumptions and conditions and such differences could be material to the consolidated financial statements.

We evaluated the development and selection of our critical accounting estimates and believe that the following involve a
higher degree of judgment or complexity and are most significant to reporting our results of operations and financial position,
and are therefore discussed as critical.

Product Return Reserve

The Company currently estimates product return reserve using its own historical sales information. The Company

regularly assesses and adjusts the estimate of accrued sales returns by updating return rates for actual company trends and
projected costs. While returns have historically been within our expectations, future return rates may differ from those
experienced in the past. Changes in these estimates can have a material impact on our financial statements. We believe the
accounting estimate related to product returns is a critical accounting estimate because it requires us to make assumptions about
future potential returns, which are highly uncertain.

Critical Accounting Policies

With respect to critical accounting policies, even a relatively minor variance between actual and expected experience can

potentially have a materially favorable or unfavorable impact on subsequent results of operations. However, our historical
results for the periods presented in the consolidated financial statements have not been materially impacted by such variances.
More information on all of our significant accounting policies can be found in Note 2, “Summary of Significant Accounting
Policies” of Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K.

Leases

The Company recognizes ROU assets and lease liabilities related to leases on the Company’s consolidated balance
sheets. The Company determines if an arrangement is, or contains, a lease at inception. ROU assets represent the right to use an
underlying asset for the lease term and lease liabilities reflect the obligation to make lease payments arising from the lease. At
any given time during the lease term, the lease liability represents the present value of the remaining lease payments and the
ROU asset is measured at the amount of the lease liability, adjusted for pre-paid rent, unamortized initial direct costs and the
remaining balance of lease incentives received. Both the lease ROU asset and liability are reduced to zero at the end of the
lease. See Note 3 “Leases,” of Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K.

Revenue Recognition

Revenue for merchandise that is shipped to our customers from our fulfillment centers and stores is recognized upon

shipment following customer payment, which is when the customer obtains control of the product and has the ability to direct
the use of the product, including, among other options, the ability to redirect the product to a different shipping destination.
Store revenue is recognized at the point of sale. This represents the point at which the customer obtains control of the product
and has the ability to direct the use of the product.

We recognize shipping and handling fees as revenue included in net sales when generated from a customer order upon
shipment or at the point of sale. Costs of shipping and handling are included in selling, general and administrative expenses.

Sales tax collected is not recognized as revenue as it is ultimately remitted to governmental authorities.

We reserve for projected merchandise returns based on both historical and actual experience, as well as various other
assumptions that we believe to be reasonable. Actual merchandise returns are monitored regularly and have not been materially
different from the estimates recorded. Product returns often represent merchandise that can be resold. Amounts refunded to
customers are generally made by issuing the same payment tender as used in the original purchase. Merchandise exchanges of

the same product and price are not considered merchandise returns and are therefore excluded when calculating the sales
returns reserve.

Inventories

Our inventories are composed of finished goods and are stated at the lower of cost or net realizable value, with cost

determined using the first-in, first-out method. Net realizable value is defined as the “estimated selling prices in the ordinary
course of business, less reasonably predictable costs of completion, disposal and transportation.” The inventory value is
adjusted periodically, if needed, to reflect current market conditions and inventory composition, which requires our judgments
that may significantly affect the ending inventory valuation, as well as gross margin. The estimates used in inventory valuation
are obsolescence (including excess and slow-moving inventory and lower of cost or market reserves) and estimates of inventory
shrinkage. We adjust our inventory for obsolescence based on historical trends, aging reports, specific identification, current
retail prices and our estimates of future retail sales prices.

The reserve for inventory shrinkage is adjusted to reflect the trend of historical physical inventory count results. The
Company performs its retail store physical inventory counts in July and the difference between actual and estimated shrinkage,
recorded in Cost of goods sold, may cause fluctuations, particularly in second fiscal quarter results.

Due to these factors, our obsolescence and shrinkage reserves contain uncertainties. Both estimates have calculations that

require us to make assumptions and to apply judgment regarding a number of factors, including market conditions, the selling
environment, historical results and current inventory trends. If actual observed obsolescence or periodic updates of our
shrinkage estimates differ from our original estimates, we adjust our inventory reserves accordingly throughout the period. We
do not believe that changes in the assumptions used in these estimates would have a significant effect on our net income or
inventory balances. We have not made any material changes to our assumptions included in the calculations of the
obsolescence and shrinkage reserves during the periods presented, nor have we recorded significant adjustments related to the
physical inventory process.

Income Taxes

We account for income taxes and the related accounts using the asset and liability method in accordance with ASC Topic
740, Income Taxes (“ASC 740”). Under this method, we accrue income taxes payable or refundable and recognize deferred tax
assets and liabilities based on differences between U.S. GAAP and tax bases of assets and liabilities. We measure deferred tax
assets and liabilities using enacted tax rates in effect for the years in which the differences are expected to reverse, and
recognize the effect of a change in enacted rates in the period of enactment.

We record net deferred tax assets to the extent we believe these assets will more likely than not be realized. In making

such determination, we consider all available positive and negative evidence, including future reversals of existing taxable
temporary differences, projected future taxable income, tax planning strategies and recent financial operations. A valuation
allowance is established if it is more likely than not that some portion or all of the deferred income tax asset will not be
realized. No valuation allowance was recognized for the years ended January 28, 2024 or January 29, 2023.

We establish assets and liabilities for uncertain tax positions taken or expected to be taken in income tax returns, using a
more-likely-than-not recognition threshold. We recognize penalties and interest related to uncertain tax positions as income tax
expense.

See Note 9 “Income Taxes,” of Notes to Consolidated Financial Statements included in this Annual Report on

Form 10-K.

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Index to Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm (KPMG LLP, PCAOB ID No. 185)
Consolidated Balance Sheets as of January 28, 2024 and January 29, 2023
Consolidated Statements of Operations for Fiscal Years Ended January 28, 2024 and January 29,
2023
Consolidated Statements of Comprehensive Income for Fiscal Years Ended January 28, 2024 and
January 29, 2023
Consolidated Statements of Shareholders’ Equity for Fiscal Years Ended January 28, 2024 and
January 29, 2023
Consolidated Statements of Cash Flows for Fiscal Years Ended January 28, 2024 and January 29,
2023
Notes to Consolidated Financial Statements
Schedule II Valuation and Qualifying Accounts

Page
38
41

45
46
63

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors
Duluth Holdings Inc.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Duluth Holdings Inc. (the Company) as of January 28, 2024
and January 29, 2023, the related consolidated statements of operations, comprehensive income, shareholders’ equity, and cash
flows for the years then ended, and the related notes and financial statement schedule II - Valuation and Qualifying Accounts
(collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all
material respects, the financial position of the Company as of January 28, 2024 and January 29, 2023, and the results of its
operations and its cash flows for each of the years then ended, in conformity with U.S. generally accepted accounting
principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the Company’s internal control over financial reporting as of January 28, 2024, based on criteria established in
Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway
Commission, and our report dated March 22, 2024 expressed an adverse opinion on the effectiveness of the Company’s internal
control over financial reporting.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audit. We are a public accounting firm registered with the
PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws
and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement,
whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the
consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such
procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial
statements. Our audit also included evaluating the accounting principles used and significant estimates made by management,
as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a
reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial
statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or
disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or
complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated
financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate
opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Product return reserve

As discussed in Note 5 to the consolidated financial statements, as of January 28, 2024 the Company recorded $5,541
thousand in reserves for product returns within accrued expenses and other current liabilities. Management estimates the
product return reserve using its own historical sales and product return information.

We identified the assessment of the product return reserve as a critical audit matter. A high degree of auditor judgment was
required to assess whether the historical return rate used to estimate the reserve for product returns is indicative of future
returns.

The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and
tested the operating effectiveness of certain internal controls related to the product return reserve. This included controls

related to determining the historical return rate used to estimate product returns. We assessed the Company’s ability to
accurately estimate the product return rate by comparing prior period estimates to actual product return rates experienced.
We analyzed the product return rate assumption by evaluating the consistency of the assumption with the trend of actual
historical product return rates and by comparing the product return reserve to actual product returns received after the
balance sheet date.

/s/ KPMG LLP

We have served as the Company’s auditor since 2021.

Milwaukee, Wisconsin
March 22, 2024

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors
Duluth Holdings Inc.

Opinion on Internal Control Over Financial Reporting

We have audited Duluth Holdings, Inc.’s (the Company) internal control over financial reporting as of January 28, 2024, based
on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations
of the Treadway Commission. In our opinion, because of the effect of the material weakness, described below, on the
achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial
reporting as of January 28, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the
Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States)
(PCAOB), the consolidated balance sheets of the Company as of January 28, 2024 and January 29, 2023, the related
consolidated statements of operations, comprehensive income, shareholders’ equity, and cash flows for the years then ended,
and the related notes and financial statement schedule II – Valuation and Qualifying Accounts (collectively, the consolidated
financial statements), and our report dated March 22, 2024 expressed an unqualified opinion on those consolidated financial
statements.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that
there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be
prevented or detected on a timely basis. A material weakness related to the mapping of general ledger accounts to the
consolidated financial statements has been identified and included in management’s assessment. The material weakness was
considered in determining the nature, timing, and extent of audit tests applied in our audit of the January 28, 2024 consolidated
financial statements, and this report does not affect our report on those consolidated financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s
Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s
internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and
are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the
applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all
material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control
over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we
considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures
that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Milwaukee, Wisconsin
March 22, 2024

/s/ KPMG LLP

DULUTH HOLDINGS INC.
Consolidated Balance Sheets
(Amounts in thousands)

January 28, 2024

January 29, 2023

ASSETS
Current Assets:

Cash and cash equivalents
Receivables
Income taxes receivable
Inventory, net
Prepaid expenses & other current assets

Total current assets

Property and equipment, net
Operating lease right-of-use assets
Finance lease right-of-use assets, net
Available-for-sale security
Other assets, net
Deferred tax asset
Total assets

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:

Trade accounts payable
Accrued expenses and other current liabilities
Income tax payable
Current portion of operating lease liabilities
Current portion of finance lease liabilities
Current maturities of TRI long-term debt

Total current liabilities

Operating lease liabilities, less current portion
Finance lease liabilities, less current portion
TRI long-term debt, less current maturities
Deferred tax liabilities
Total liabilities
Shareholders' equity:
Preferred stock, no par value; 10,000 shares authorized; no shares

issued or outstanding as of January 28, 2024 and January 29, 2023

Common stock (Class A), no par value; 10,000 shares authorized;
3,364 shares issued and outstanding as of January 28, 2024 and
January 29, 2023

Common stock (Class B), no par value; 200,000 shares authorized;
31,178 shares issued and 31,023 shares outstanding as of January 28, 2024 and
30,191 shares issued and 30,079 outstanding as of January 29, 2023
Treasury stock, at cost; 155 and 112 shares as of January 28, 2024 and

January 29, 2023, respectively

Capital stock
Retained earnings
Accumulated other comprehensive income

Total shareholders' equity of Duluth Holdings Inc.

Noncontrolling interest

Total shareholders' equity
Total liabilities and shareholders' equity

32,157
5,955
617
125,757
16,488
180,974
132,718
121,430
40,315
4,986
9,020
1,010
490,453

51,122
30,930
—
16,401
3,149
847
102,449
106,413
34,276
25,141
—
268,279

—

(1,738)
103,579
123,816
(427)
225,230
(3,056)
222,174
490,453

45,548
6,041
—
154,922
15,154
221,665
116,527
131,753
43,243
5,539
8,727
—
527,454

56,547
40,815
1,761
15,571
2,842
768
118,304
117,366
37,425
25,913
1,249
300,257

—

(1,459)
98,842
133,172
(148)
230,407
(3,210)
227,197
527,454

The accompanying notes are an integral part of these consolidated financial statements.

DULUTH HOLDINGS INC.
Consolidated Statements of Operations
(Amounts in thousands, except per share figures)

Net sales
Cost of goods sold (excluding depreciation and amortization)
Gross profit
Selling, general and administrative expenses
Operating (loss) income
Interest expense
Other income, net
(Loss) income before income taxes
Income tax (benefit) expense
Net (loss) income
Less: Net income (loss) attributable to noncontrolling interest
Net (loss) income attributable to controlling interest
Basic earnings per share (Class A and Class B):
Weighted average shares of
common stock outstanding

Net (loss) income per share attributable

to controlling interest

Diluted earnings per share (Class A and Class B):
Weighted average shares and
equivalents outstanding

Net (loss) income per share attributable

to controlling interest

Fiscal Year Ended

January 28, 2024

January 29, 2023

646,681
321,710
324,971
333,804
(8,833)
4,156
923
(12,066)
(2,693)
(9,373)
(17)
(9,356)

32,955

(0.28)

32,955

(0.28)

653,307
309,872
343,435
337,204
6,231
3,653
376
2,954
708
2,246
(58)
2,304

32,772

0.07

32,991

0.07

The accompanying notes are an integral part of these consolidated financial statements.

DULUTH HOLDINGS INC.
Consolidated Statements of Comprehensive Income
(Amounts in thousands)

Net (loss) income
Other comprehensive (loss) income
Securities available-for-sale:
Unrealized security loss
Income tax benefit

Other comprehensive loss
Comprehensive (loss) income
Comprehensive income (loss) attributable

to noncontrolling interest

Comprehensive (loss) income attributable

to controlling interest

Fiscal Year Ended

January 28, 2024

January 29, 2023

(9,373)

2,246

(372)
(93)
(279)
(9,652)

(17)

(9,635)

(852)
(215)
(637)
1,609

(58)

1,667

The accompanying notes are an integral part of these consolidated financial statements.

DULUTH HOLDINGS INC.
Consolidated Statements of Shareholders’ Equity
(Amounts in thousands)

Balance at January 30, 2022
Issuance of common stock
Stock-based compensation
Restricted stock forfeitures
Restricted stock surrendered

for taxes

Other comprehensive loss
Net income (loss)

Balance at January 29, 2023
Issuance of common stock
Stock-based compensation
Restricted stock forfeitures
Restricted stock surrendered

for taxes

Changes in the TRI Holdings, LLC
Consolidation
Other comprehensive loss
Net (loss) income

Capital stock

Shares
33,071 $ 95,515 $

Amount

457
—
(54)

(31)
—
—

616
2,711
—

—
—
—

33,443 $ 98,842 $
1,243
—
(257)

542
4,195
—

(42)

—
—
—

—

—
—
—

Treasury
stock
(1,002) $ 130,868 $

Retained
earnings

—
—
—

(457)
—
—

—
—
—

—
—
2,304

(1,459) $ 133,172 $

—
—
—

(279)

—
—
—

—

—
—
(9,356)

Balance at January 28, 2024

34,387 $ 103,579 $

(1,738) $ 123,816 $

Accumulated
other

Noncontrolling
interest in

comprehensive variable interest

loss

entities

Total
shareholders'
equity

489 $
—
—
—

—
(637)
—
(148) $
—
—
—

(3,152) $ 222,718
616
2,711
—

—
—
—

—

(58)

(457)
(637)
2,246
(3,210) $ 227,197
542
4,195
—

—
—
—

—

(279)

—
(279)
—
(427) $

171
—
(17)

171
(279)
(9,373)
(3,056) $ 222,174

The accompanying notes are an integral part of these consolidated financial statements.

DULUTH HOLDINGS INC.
Consolidated Statements of Cash Flows
(Amounts in thousands)

Cash flows from operating activities:
Net (loss) income
Adjustments to reconcile net income to net cash provided

by operating activities:

Depreciation and amortization
Stock-based compensation
Deferred income taxes
Loss on disposal of property and equipment
Changes in operating assets and liabilities:

Receivables
Income taxes receivable
Inventory
Prepaid expense & other assets
Software hosting implementation costs, net
Deferred catalog costs
Trade accounts payable
Income taxes payable
Accrued expenses and deferred rent obligations
Other
Noncash lease impacts

Net cash provided by (used in) operating activities
Cash flows from investing activities:
Purchases of property and equipment
Principal receipts from available-for-sale security
Proceeds from disposal of PP&E
Changes in the TRI Holdings, LLC Consolidation
Net cash used in investing activities
Cash flows from financing activities:
Proceeds from line of credit
Payments on line of credit
Proceeds from long term debt
Payments on long term debt
Payments on TRI long term debt
Payments on finance lease obligations
Shares withheld for tax payments on vested restricted stock
Other
Net cash used in financing activities
Decrease in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
Supplemental disclosure of cash flow information:
Interest paid
Income taxes paid
Supplemental disclosure of non-cash information:
Unpaid liability to acquire property and equipment

Fiscal Year Ended

January 28, 2024

January 29, 2023

(9,373)

2,246

32,159
4,195
(2,166)
130

86
(617)
29,165
(1,675)
(216)
—
(5,449)
(1,761)
(5,141)
58
(722)
38,673

(49,086)
181
16
171
(48,718)

56,000
(56,000)
—
—
(767)
(2,842)
(279)
542
(3,346)
(13,391)
45,548
32,157

4,156
2,026

1,874

$
$

30,810
2,711
(1,403)
1,392

(586)
—
(32,250)
5,101
(6,121)
10
12,685
(5,053)
(11,768)
(365)
1,195
(1,396)

(27,065)
164
28
—
(26,873)

—
—
25,000
(25,000)
(692)
(2,701)
(457)
616
(3,234)
(31,503)
77,051
45,548

3,653
7,223

8,783

$
$

The accompanying notes are an integral part of these consolidated financial statements.

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION

Nature of Operations

Duluth Holdings Inc. (“Duluth Trading” or the “Company”), a Wisconsin corporation, is a lifestyle brand of men’s and

women’s casual wear, workwear and accessories sold primarily through the Company’s own omnichannel platform. The
Company’s products are marketed under the Duluth Trading Company brand, with the majority of products being exclusively
developed and sold as Duluth Trading branded merchandise.

In 2010, the Company initiated its omnichannel platform with the opening of its first store. Since then, Duluth Trading

has expanded its retail presence, and as of January 28, 2024, the Company operated 62 retail stores and three outlet stores. The
Company identifies its operating segments according to how its business activities are managed and evaluated. The Company
continues to grow its omnichannel distribution network which allows the consumer to interact with the Company through a
consistent customer experience whether on the Company website or at Company stores. The Company has one reportable
external segment, consistent with the Company’s omnichannel business approach. The Company’s revenues generated outside
the United States were insignificant.

The Company has two classes of authorized common stock: Class A common stock and Class B 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 ten 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 Company’s Class B common stock
trades on the NASDAQ Global Select Market under the symbol “DLTH.”

Basis of Presentation

The consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles

(“U.S. GAAP”). All significant intercompany balances and transactions have been eliminated in consolidation.

The Company’s fiscal year ends on the Sunday nearest to January 31 of the following year. Fiscal 2023 and Fiscal 2022

ended on January 28, 2024 and January 29, 2023, respectively. Fiscal 2023 and Fiscal 2022 were each a 52-week period.

Seasonality of Business

The Company’s business is affected by the pattern of seasonality common to most retail apparel businesses. Historically,
the Company has recognized a significant portion of its revenue and operating profit in the fourth fiscal quarter of each year as
a result of increased sales during the holiday season.

Revision of Prior Period Financial Information

The Company has revised its Consolidated Balance Sheet as of January 29, 2023 and related notes included herein to

correct immaterial classification errors in Property and equipment, Prepaid expenses and Finance lease right-of-use assets, net.
Revisions have been reflected in the Consolidated Balance Sheet as of January 29, 2023 to increase Property and equipment by
$8.2 million and decrease Prepaid expenses and Finance lease right-of-use assets, net by $4.2 million and $4.0 million,
respectively. The Company also revised the fiscal 2022 Consolidated Statement of Cash Flows to decrease cash flows used in
operating activities by $4.2 million and increase cash flows used in investing activities by $4.2 million. There were no changes
to previously reported net income, total assets, or shareholders’ equity.

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The accompanying consolidated financial statements consist of the accounts of Duluth Holdings Inc. and TRI Holdings,

LLC (“TRI”) as a variable interest entity. See Note 6 “Variable Interest Entities” for further information.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and

assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results
could differ from those estimates.

Revenue Recognition

The Company’s revenue primarily consists of the sale of apparel, footwear and hard goods. Revenue for merchandise that

is shipped to our customers from our fulfillment centers and stores is recognized upon shipment following customer payment,
which is when the customer obtains control of the product and has the ability to direct the use of the product, including, among
other options, the ability to redirect the product to a different shipping destination. Store revenue is recognized at the point of
sale. The Company provides the customer the right of return on the product and revenue is adjusted based on an estimate of the
expected returns based on historical rates as well as events that may cause changes to historical rates. See Note 5 “Accrued
Expense and Other Liabilities” for the Company’s product returns reserve. Shipping and processing revenue generated from
customer orders are included as a component of net sales and shipping and processing expense, including handling expense, is
included as a component of selling, general and administrative expenses. Sales tax collected from customers and remitted to
taxing authorities is excluded from revenue and is included in accrued expenses. A liability is recognized at the time a gift card
is sold, and revenue is recognized at the time the gift card is redeemed for merchandise. See Note 8 “Revenue” for further
information.

Cost of Goods Sold and Selling, General and Administrative Expenses

The following table illustrates the primary costs classified in cost of goods sold and selling, general and administrative

expenses:

Cost of Goods Sold
• Direct cost of purchased merchandise
• Inventory shrinkage and inventory adjustments due to

obsolescence
• Inbound freight
• Freight from the Company's fulfillment centers to its stores

Selling, General and Administrative Expenses

• Payroll and payroll-related expenses
• Occupancy expenses related to stores and operations at the

Company's headquarters, including utilities

• Depreciation and amortization
• Advertising expenses including: digital, television, and

social media advertising; catalog production and mailing;
and print advertising costs

• Freight associated with shipping product to customers
• Consulting and professional fees

Advertising and Catalog Expenses

The Company’s advertising and catalog expense primarily consists of web marketing programs, social media and radio

and television advertisements, which are expensed as they are incurred. The Company’s direct-response advertising consists of
producing, printing and mailing catalogs, which are expensed upon receipt by customers.

Advertising and Catalog expenses were $69.0 million and $76.3 million for fiscal 2023 and fiscal 2022, respectively.

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

Shipping and Processing

Shipping and processing revenue generated from customer orders has been classified as a component of net sales.
Shipping and processing expense, including handling expense, has been classified as a component of selling, general and
administrative expenses. The Company incurred shipping and processing expenses of $47.2 million and $44.0 million for fiscal
2023 and fiscal 2022, respectively.

Income Taxes

The Company accounts for income taxes and related accounts using the asset/liability method in accordance with ASC

Topic 740, Income Taxes (“ASC 740”). Under ASC 740, the Company accrues income taxes payable or refundable and
recognizes deferred tax assets and liabilities based on differences between U.S. GAAP and tax bases of assets and liabilities.
The Company measures deferred tax assets and liabilities using enacted tax rates in effect for the years in which the differences
are expected to reverse, and recognizes the effect of a change in enacted rates in the period of enactment. A valuation allowance
is established if it is more likely than not that some portion or all of the deferred income tax asset will not be realized.

The Company establishes assets and liabilities for uncertain tax positions taken or expected to be taken in income tax
returns, using a more-likely-than-not recognition threshold. The Company recognizes penalties and interest related to uncertain
tax positions as income tax expense. See Note 9 “Income Taxes,” of these Notes to Consolidated Financial Statements for
further discussion.

Concentrations of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash

deposits. At various times during the year, the Company has certain cash balances deposited in financial institutions in excess
of federally insured limits. The Company has not experienced any losses in such accounts and management believes it is not
exposed to any significant credit risk.

Cash and Cash Equivalents

The Company considers short-term investments with original maturities of three months or less when purchased to be
cash equivalents. As of January 29, 2023, Cash and cash equivalents consisted of cash, amounts receivable from credit card
issuers and money market funds. Amounts receivable from credit card issuers are typically converted to cash within 2 to 4 days
of the original sales transaction and are considered to be cash equivalents.

Significant Suppliers

The Company’s principal supplier of inventory accounted for 59% and 56% of total inventory expenditures in fiscal 2023

and fiscal 2022, respectively. The Company also had a second supplier that accounted for 10% and 11% of total inventory
expenditures in fiscal 2023 and fiscal 2022, respectively.

Inventories

Inventory consists of finished goods stated at the lower of cost or net realizable value, with cost determined using the

first-in, first-out valuation method. The Company records an inventory reserve for the anticipated loss associated with selling
inventories below cost. Inventory reserve for excess, obsolete items and shrinkage was $1.4 million and $1.8 million as of
January 28, 2024 and January 29, 2023, respectively.

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

Property and Equipment

Property and equipment consist of the following:

(in thousands)
Land and land improvements
Leasehold improvements
Buildings
Vehicles
Warehouse equipment
Office equipment and furniture
Computer equipment
Software

Accumulated depreciation and amortization

Construction in progress
Property and equipment, net

January 28, 2024

January 29, 2023

4,486
56,850
36,191
121
66,481
54,294
11,142
39,923
269,488
(140,551)
128,937
3,781
132,718

4,486
49,450
36,183
161
25,951
53,713
9,185
36,260
215,389
(115,026)
100,363
16,164
116,527

The Company recorded depreciation expense of $28.0 million and $26.7 million for fiscal 2023 and fiscal 2022,

respectively. The Company expenses as incurred all routine repair and maintenance costs that do not extend the estimated
useful life of the asset.

Property and equipment are carried at cost and are generally depreciated using the straight-line method over the estimated

useful lives. Leasehold improvements are depreciated over the shorter of the lease term or estimated useful life. Depreciable
lives by major classification generally are as follows:

Land improvements
Leasehold improvements
Buildings
Vehicles
Warehouse equipment
Office equipment and furniture
Computer equipment
Software

Years
15
3 - 15
39
5

7 - 10
7 - 10
3 - 5
3 - 5

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

Prepaid Expenses and Other Assets

Prepaid expenses and other assets consist of the following:

(in thousands)
Prepaid expenses & other current assets

Pending returns inventory, net
Current software hosting implementation costs, net
Other prepaid expenses

Prepaid expenses & other current assets

Other assets, net

Goodwill
Intangible assets, net
Non-current software hosting implementation costs
Other assets, net

Other assets, net

Software Hosting Implementation Costs

January 28, 2024

January 29, 2023

2,778
3,353
10,357
16,488

402
436
6,705
1,477
9,020

2,373
3,074
9,707
15,154

402
450
6,148
1,727
8,727

Software hosting implementation costs includes costs of implementation activities of certain cloud computing

arrangements in accordance with Accounting Standards Update No. 2018-15, Intangibles – Goodwill and Other – Internal-Use
Software (Subtopic 350-40). Amortization expense was $5.0 million and $3.6 million for fiscal 2023 and fiscal 2022,
respectively. Accumulated amortization was $10.4 million and $5.4 million for fiscal 2023 and fiscal 2022, respectively. See
Note 12 “Recent Accounting Pronouncements” for more information.

Goodwill

Goodwill represents the excess of purchase price over the fair value of net assets acquired. ASC Topic 350, Intangibles-

Goodwill and Other, requires that goodwill be tested for impairment annually, or more often if an event or circumstance
indicates that an impairment loss may have been incurred. The Company’s management uses its judgment in assessing whether
goodwill may have become impaired between annual impairment tests. Indicators such as unexpected adverse business
conditions, economic factors, competitive activities, loss of key personnel and acts by governments may signal that an asset has
become impaired.

Management performed its annual qualitative assessment of goodwill as of December 31, 2023 and 2022, which included

assessed factors such as macroeconomic conditions, industry and market considerations, cost factors and overall financial
performance and determined that it was more likely than not that the fair value of the Company was greater than its carrying
amount; as such, no further evaluation of goodwill was deemed necessary. No impairment was recognized for the years ended
January 28, 2024 or January 29, 2023.

Intangible Assets and Other Assets

Intangible assets and other assets include loan origination fees and trade names which are amortized over their estimated
useful lives ranging from three years to fifteen years. Other assets also primarily include security deposits required by certain of
the Company’s lease agreements and prepaid expenses. Amortization expense was $0.2 million for fiscal 2023 and fiscal 2022.
Accumulated amortization was $1.0 million and $0.8 million as of January 28, 2024 and January 29, 2023, respectively.

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

Scheduled future amortization of amortizable other assets is as follows as of January 28, 2024:

Fiscal year
(in thousands)
2024
2025
2026
2027
2028
Thereafter

191
157
92
22
2
6
470

Impairment of Long-Lived Assets

The Company’s long-lived assets are reviewed for impairment during the fourth quarter, or whenever events or changes
in circumstances indicate that the carrying amount may not be recoverable. If the sum of the expected undiscounted cash flows
is less than the carrying value of the related asset or group of assets, a loss is recognized for the difference between the fair
value and the carrying value of the asset or group of assets. Such analyses necessarily involve judgment.

For fiscal 2023, management did not identify any events or changes in circumstances that indicated the potential

impairment of long-lived assets.

Store Pre-opening Costs

Store pre-opening costs are expensed as incurred and are included in selling, general and administrative expenses.

Stock-Based Compensation

In connection with the IPO, the Company adopted the 2015 Equity Incentive Plan of Duluth Holdings Inc. (“2015 Plan”),

which provides compensation alternatives such as stock options, shares, restricted stock, restricted stock units, deferred stock
and performance share units, using or based on the Company’s Class B common stock.

The Company accounts for its stock-based compensation plan in accordance with ASC Topic 718, Stock Compensation,

which requires the Company to measure all share-based payments at grant date fair value and recognize the cost over the
requisite service period of the award. Restricted stock issued to board members generally vests over a period of one year.
Restricted stock issued to key employees and executives typically vests over a period of three years to five years based on the
terms for each individual award. The fair value of the restricted stock is determined based on the market value of the
Company’s Class B common stock on the grant date. Restricted stock forfeitures are recognized as incurred.

Total stock compensation expense associated with restricted stock recognized by the Company was $4.2 million and $2.7

million for fiscal 2023 and fiscal 2022, respectively, and is included in Selling, general and administrative expenses on the
Consolidated Statements of Operations.

The following is a summary of the activity in the Company’s unvested restricted stock during the years ended January 28,

2024 and January 29, 2023:

Outstanding at January 30, 2022

Granted
Vested
Forfeited

Outstanding at January 29, 2023

Granted
Vested
Forfeited

Outstanding at January 28, 2024

Weighted average
grant date
fair value
per share

13.54
10.99
13.44
12.20
12.05
6.51
12.22
5.73
8.77

405,334
392,497
(124,773)
(54,286)
618,772
1,168,316
(164,116)
(255,702)
1,367,270

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

At January 28, 2024, the Company had unrecognized compensation expense of $6.4 million related to the restricted stock

awards, which is expected to be recognized over a weighted average period of 2.3 years.

Treasury Stock

Treasury stock consists of shares withheld in lieu of tax payments when restricted stock vests using the treasury cost

method and is classified in the Consolidated Balance Sheets as a reduction to shareholders’ equity.

Taxes Collected from Customers

The Company presents all non-income government-assessed taxes (sales, use and value-added taxes) collected from its

customers and remitted to governmental agencies on a net basis (excluded from revenue) in its consolidated financial
statements.

Other Comprehensive Income

Other comprehensive income or loss represents the change in equity from non-shareholder or non-member transactions,
which is not included in the statements of earnings but is reported as a separate component of shareholders’ equity. For fiscal
2023 and fiscal 2022, other comprehensive income consists of changes in unrealized gains and losses on the Company’s
available-for-sale security, net of taxes.

Fair Value Measurements

ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), defines fair value as the price that would be

received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement
date (i.e., an exit price). The exit price is based on the amount that the holder of the asset or liability would receive or need to
pay in an actual transaction (or in a hypothetical transaction if an actual transaction does not exist) at the measurement date.
ASC 820 describes a fair value hierarchy based on three levels of inputs that may be used to measure fair value, of which the
first two are considered observable and the last unobservable, as follows:

Level 1 – Quoted prices in active markets for identical assets or liabilities.

Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar

assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by
observable market data for substantially the full term of the assets or liabilities.

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of

the assets or liabilities.

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

The Company’s assets and liabilities measured at fair value are categorized as Level 1 or Level 3 instruments. The fair
value of the Company’s money market account is obtained from real-time quotes for transactions in active exchange markets
involving identical assets (Level 1). The fair value of the Company’s available-for-sale security was valued based on a
discounted cash flow method (Level 3), which incorporates the U.S. Treasury yield curve, credit information and an estimate of
future cash flows. During fiscal 2023, certain changes in the inputs did impact the fair value of the available-for-sale security.
The calculated fair value is based on estimates that are subjective in nature and involve uncertainties and matters of significant
judgement and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

The amortized cost and fair value of the Company’s money market account and available-for-sale security along with the

corresponding amount of gross unrealized gains and losses recognized in accumulated other comprehensive income are as
follows.

(in thousands)
Level 1 security:

Money market funds

Level 3 security:
Corporate trust

(in thousands)
Level 1 security:

Money market funds

Level 3 security:
Corporate trust

Cost or

Amortized

Cost

January 28, 2024

Gross

Unrealized

Gains

Losses

Estimated

Fair Value

28,396

— $

28,396

5,556

— $

(570)

4,986

Cost or

Amortized

Cost

January 29, 2023

Gross

Unrealized

Gains

Losses

Estimated

Fair Value

25,031

— $

25,031

5,737

— $

(198)

5,539

The Company does not intend to sell the available-for-sale-security in the near term and does not believe that it will be

required to sell the security. The Company reviews its security on a quarterly basis to monitor its exposure to other-than-
temporary impairment.

No other-than-temporary impairment was recorded in the Consolidated Statements of Operations in fiscal 2023 or fiscal

2022.

The following table presents the future receipts related to the Company’s available-for-sale security by contractual

maturity as of January 28, 2024.

(in thousands)
Within one year
After one year through five years
After five years through ten years
After ten years
Total

Amortized
Cost

Estimated
Fair Value

200
1,320
1,984
2,052
5,556

161
1,127
1,791
1,907
4,986

The carrying values and fair values of other financial instruments in the Consolidated Balance Sheets are as follows:

January 28, 2024

January 29, 2023

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

(in thousands)
TRI Long-term debt, including short-term portion

Carrying
Amount

25,988

Fair Value
23,554

Carrying
Amount

26,681

Fair Value
26,172

The above long-term debt, including the short-term portion is attributable to the consolidation of TRI in accordance with

ASC Topic 810, Consolidation. The fair value was also based on a discounted cash flow method (Level 3) based on credit
information and an estimate of future cash flows.

3. LEASES

Based on the criteria set forth in ASC Topic 842, Leases (“ASC 842”), the Company recognizes ROU assets and lease
liabilities related to leases on the Company’s Consolidated Balance Sheets. The Company determines if an arrangement is, or
contains, a lease at inception. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities
reflect the obligation to make lease payments arising from the lease. At any given time during the lease term, the lease liability
represents the present value of the remaining lease payments and the ROU asset is measured at the amount of the lease liability,
adjusted for pre-paid rent, unamortized initial direct costs and the remaining balance of lease incentives received. Both the lease
ROU asset and liability are reduced to zero at the end of the lease.

The Company leases retail space under non-cancelable lease agreements, which expire on various dates through 2041.

Substantially all of these arrangements are store leases. Store leases generally have initial lease terms ranging from five years to
fifteen years with renewal options and rent escalation provisions. At the commencement of a lease, the Company includes only
the initial lease term as the option to extend is not reasonably certain. The Company does not record leases with a lease term of
12 months or less on the Company’s Consolidated Balance Sheets.

When calculating the lease liability on a discounted basis, the Company applies its estimated discount rate. The
Company bases this discount rate on a collateralized interest rate as well as publicly available data for instruments with similar
characteristics.

In addition to rent payments, leases for retail space contain payments for real estate taxes, insurance costs, common area

maintenance, and utilities that are not fixed. The Company accounts for these costs as variable lease expenses and does not
include such costs as a lease component.

The expense components of the Company’s leases reflected on the Company’s Consolidated Statement of Operations

were as follows:

(in thousands)
Finance lease expense

Amortization of right-of-use

assets

Interest on lease liabilities

Total finance lease expense
Operating lease expense
Amortization of build-to-suit leases

capital contribution
Variable lease expense
Total lease expense

Consolidated Statement of Operations

January 28, 2024

January 29, 2023

Selling, general and administrative expenses
Interest expense

Selling, general and administrative expenses

Selling, general and administrative expenses
Selling, general and administrative expenses

$
$

3,361
1,709
5,070
20,267

1,284
10,927
37,548

$
$

3,361
1,822
5,183
18,725

1,284
10,380
35,572

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

Other information related to leases were as follows:

(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:

Financing cash flows from finance leases
Operating cash flows from finance leases
Operating cash flows from operating leases

Right-of-use assets obtained in exchange for lease liabilities:

Operating leases

Weighted-average remaining lease term (in years):

Finance leases
Operating leases

Weighted-average discount rate:

Finance leases
Operating leases

January 28, 2024

January 29, 2023

$
$
$

2,842
1,709
20,842

$
$
$

2,701
1,822
18,477

5,468

25,297

10
7

4.5%
4.2%

11
8

4.4%
4.1%

Future minimum lease payments under the non-cancellable leases are as follows as of January 28, 2024:

Fiscal year
(in thousands)
2024
2025
2026
2027
2028
Thereafter
Total future minimum lease payments
Less - Discount
Lease liability

Finance
Leases

Operating
Leases

4,736
5,099
3,993
3,993
4,017
25,214
47,052
9,627
37,425

21,205
20,613
19,660
18,411
16,631
46,794
143,314
20,500
122,814

Total rent expense under non-cancellable leases was $21.8 million and $20.0 million for fiscal 2023 and fiscal 2022,

respectively.

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

4. DEBT AND CREDIT AGREEMENT

Debt consists of the following:

(in thousands)
TRI Senior Secured Note
TRI Note

Less: current maturities
TRI Long-term debt

TRI Holdings, LLC

January 28, 2024

January 29, 2023

22,488
3,500
25,988
847
25,141

23,181
3,500
26,681
768
25,913

TRI entered into a senior secured note (“TRI Senior Secured Note”) with an original balance of $26.7 million. The TRI

Senior Secured Note is scheduled to mature on October 15, 2038 and requires installment payments with an interest rate of
4.95%. See Note 6 “Variable Interest Entities” for further information.

TRI entered into a promissory note (“TRI Note”) with an original balance of $3.5 million. The TRI Note is scheduled to

mature in November 2038 and requires annual interest payments at a rate of 3.05%, with a final balloon payment due in
November 2038.

While the above notes are consolidated in accordance with ASC Topic 810, Consolidation, the Company is not the

guarantor nor the obligor of these notes.

Credit Agreement

On May 14, 2021, the Company terminated its prior credit agreement, and entered into a credit agreement (the “Credit

On July 8, 2022, the Company entered into the First Amendment to the Credit Agreement (the “First Amendment”),

As of January 28, 2024, and for the fiscal year then ended, the Company was in compliance with all financial and non-

financial covenants in the Credit Agreement.

Future principal maturities of all TRI debt, excluding unamortized financing fees of $1.1 million associated with the TRI

debt are as follows as of January 28, 2024:

Fiscal year
(in thousands)
2024
2025
2026
2027
2028
Thereafter

847
931
1,020
1,114
1,214
21,944
27,070

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

5. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the following:

(in thousands)
Salaries and benefits
Deferred revenue
Freight
Product returns
Unpaid purchases of property & equipment
Accrued advertising
Other
Total accrued expenses and other current liabilities

6. VARIABLE INTEREST ENTITIES

January 28, 2024

January 29, 2023

2,692
9,579
4,001
5,541
765
1,129
7,223
30,930

2,404
10,249
7,193
5,168
6,271
2,020
7,510
40,815

Based upon the criteria set forth in ASC 810, Consolidation, the Company consolidates variable interest entities (“VIEs”)

in which it has a controlling financial interest and is therefore deemed the primary beneficiary. A controlling financial interest
will have both of the following characteristics: (a) the power to direct the VIE activities that most significantly impact
economic performance; and (b) the obligation to absorb the VIE losses and the right to receive benefits that are significant to
the VIE. The Company has determined that it was the primary beneficiary of one VIE as of January 28, 2024 and January 29,
2023.

The Company leases the Company’s headquarters in Mt. Horeb, Wisconsin from TRI. In conjunction with the lease,

the Company originally invested $6.3 million in a trust that loaned funds to TRI for the construction of the Company’s
headquarters. TRI is a Wisconsin limited liability company whose primary purpose and activity is to own this real property.
The Company considers itself the primary beneficiary for TRI as the Company has both the power to direct the activities that
most significantly impact the entity’s economic performance and is expected to receive benefits that are significant to TRI. As
the Company is the primary beneficiary, it consolidates TRI and the lease is eliminated in consolidation. The Company does
not consolidate the trust as the Company is not the primary beneficiary.

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

The Consolidated Balance Sheets include the following amounts as a result of the consolidation of TRI as of January 28,

2024 and January 29, 2023.

(in thousands)
Cash
Property and equipment, net

Total assets

Other current liabilities
Current maturities of TRI long-term debt
TRI long-term debt
Noncontrolling interest in VIE

Total liabilities and shareholders' equity

January 28, 2024

January 29, 2023

17
22,941
22,958

26
847
25,141
(3,056)
22,958

20
23,612
23,632

161
768
25,913
(3,210)
23,632

While the Balance Sheet is consolidated in accordance with ASC Topic 810, Consolidation, the Company is not the

guarantor nor the obligor of the TRI debt.

7. EARNINGS PER SHARE

Earnings per share is computed under the provisions of ASC 260, Earnings Per Share. Basic earnings per share is based

on the weighted average number of common shares outstanding for the period. Diluted earnings per share is based on the
weighted average number of common shares plus the effect of dilutive potential common shares outstanding during the period
using the treasury stock method. Dilutive potential common shares include outstanding restricted stock and are considered only
for dilutive earnings per share. The reconciliation of the numerator and denominator of the basic and diluted earnings per share
calculation is as follows:

(in thousands, except per share data)
Numerator - net (loss) income attributable to controlling interest
Denominator - weighted average shares (Class A and Class B)

Basic
Dilutive shares
Diluted

Earnings per share (Class A and Class B)

Basic
Diluted

Fiscal Year Ended

January 28, 2024

January 29, 2023

$
$

(9,356)

32,955
—
32,955

(0.28)
(0.28)

$
$

2,304

32,772
219
32,991

0.07
0.07

The computation of diluted loss per share excluded 0.4 million shares of unvested restricted stock for the fiscal year

ended January 28, 2024, respectively, because their inclusion would be anti-dilutive due to a net loss.

8. REVENUE

The Company’s revenue primarily consists of the sale of apparel, footwear and hard goods. Revenue for merchandise

that is shipped to our customers from our fulfillment centers and stores is recognized upon shipment. Store revenue is
recognized at the point of sale, net of returns, and excludes taxes. Shipping and processing revenue generated from customer
orders are included as a component of net sales and shipping and processing expense, including handling expense, is included
as a component of selling, general and administrative expenses. Sales tax collected from customers and remitted to taxing
authorities is excluded from revenue and is included in accrued expenses.

Sales disaggregated based upon sales channel is presented below.

(in thousands)
Direct-to-consumer
Stores

January 28, 2024

January 29, 2023

425,562
221,119

412,123
241,184

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

646,681

653,307

Contract Assets and Liabilities

The Company’s contract assets primarily consist of the right of return for amounts of inventory to be returned that is
expected to be resold and is recorded in Prepaid expenses and other current assets on the Company’s Consolidated Balance
Sheets. The Company’s contract liabilities primarily consist of gift card liabilities and are recorded upon issuance in Accrued
expenses and other current liabilities under deferred revenue (see Note 5 “Accrued Expenses and Other Current Liabilities”) on
the Company’s Consolidated Balance Sheets. Upon issuance of a gift card, a liability is established for its cash value.

Contract assets and liabilities on the Company’s Consolidated Balance Sheets are presented in the following table:

(in thousands)
Contract assets
Contract liabilities

January 28, 2024

January 29, 2023

$
$

2,778
9,579

$
$

2,373
10,249

Revenue from gift cards is recognized when the gift card is redeemed by the customer for merchandise, or as gift card

breakage, an estimate of gift cards which will not be redeemed. The Company does not record breakage revenue when escheat
liability to the relevant jurisdictions exists. Gift card breakage is recorded within Net sales on the Company’s Consolidated
Statement of Operations. The following table provides the reconciliation of the contract liability related to gift cards:

(in thousands)
Balance as of Beginning of Period
Gift cards sold
Gift cards redeemed
Gift card breakage
Balance as of End of Period

9. INCOME TAXES

The components of income tax expense were as follows:

(in thousands)
Current:
Federal
State

Deferred:
Federal
State

Total income tax expense

January 28, 2024

January 29, 2023

10,249
18,116
(16,940)
(1,846)
9,579

10,791
17,330
(16,265)
(1,607)
10,249

Fiscal Year Ended

January 28, 2024

January 29, 2023

(638)
230
(408)

(1,710)
(575)
(2,285)
(2,693)

1,158
953
2,111

(884)
(519)
(1,403)
708

The tax effects of unrealized gains and losses on securities are components of other comprehensive income and therefore

excluded from deferred tax expense.

Realization of the deferred tax asset over time is dependent upon the Company generating sufficient taxable earnings in

future periods. In making the determination that the realization of the deferred tax was more likely than not, the Company
considered several factors including its recent earnings history, its expected earnings in the future, and appropriate tax planning

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

strategies. The Company believes it will be able to fully utilize its established deferred tax assets and therefore no valuation
allowance has been established as of January 28, 2024 and January 29, 2023.

The reconciliation of income tax expense to the amount computed at the federal statutory rate was as follows:

(in thousands)
Federal taxes at statutory rate
State and local income taxes, net of federal benefit
Stock compensation price difference
Research and development tax credits
Nondeductible compensation
Adjustments to uncertain tax positions
Other
Total income tax expense

Fiscal Year Ended

January 28, 2024

January 29, 2023

(2,524)
(390)
150
(283)
384
(164)
134
(2,693)

21.0 % $

3.2 %
(1.2)%
2.4 %
(3.2)%
1.4
(1.2)%
22.4 % $

633
144
6
(296)
182
(10)
49
708

21.0 %
4.8 %
0.2 %
(9.8)%
6.0 %
(0.4)%
1.7 %
23.5 %

Deferred income taxes reflect the net tax effects of temporary differences between U.S. GAAP and tax bases of assets

and liabilities. Significant components of deferred tax assets and liabilities were as follows:

January 28, 2024

January 29, 2023

(in thousands)
Deferred tax assets:
Returns allowance
Uniform inventory capitalization
Unrealized loss on investment
Federal and state credit
Lease liability
Accruals
Stock-based compensation
Advance payments
Business Interest limitation
Unrecognized tax benefits
Charitable contributions
Research and development
Federal and state NOL
Total deferred tax assets

Deferred tax liabilities:

Property and equipment
Prepaid expenses
Right-of-use asset
Goodwill and intangibles
Inventory reserve

Total deferred tax liabilities
Net deferred tax assets (liabilities)

1,402
3,637
144
426
52,642
389
491
687
127
3
181
1,723
5,183
67,035

12,641
949
52,006
71
358
66,025
1,010

1,304
3,870
50
38
54,648
303
341
751
—
7
87
1,288
4
62,691

8,439
822
54,475
69
135
63,940
(1,249)

As of January 28, 2024, we had state net operating losses (“NOL”) of approximately $7.6 million, with deferred tax
assets of $0.3 million related to these state NOLs. These state net operating loss carryforwards expire at various intervals from
2029 through 2044. The federal NOL is approximately $23.0 million, with deferred tax asset of $4.8 million related to the
federal NOL.

Uncertain Tax Positions

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

(in thousands)
Balance beginning of year

January 28, 2024

January 29, 2023

287

297

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

Additions for tax positions in prior years
Additions for tax positions in current year
Statute of limitations
Balance at end of year

(74)
37
(131)
119

(2)
11
(19)
287

If recognized, $0.1 million of the Company’s unrecognized tax benefits as of January 28, 2024, would affect the

Company’s effective tax rate. The Company does not anticipate that there will be a material change in the balance of the
unrecognized tax benefits in the next 12 months. Any interest and penalties related to uncertain tax positions are recorded in
income tax expense. There were no material amounts recorded as tax expense for interest or penalties for the years ended
January 29, 2023.

The Company files income tax returns in the United States federal jurisdiction and in various state jurisdictions. Federal

tax returns for tax years 2020 through 2022, and state tax returns for tax years 2019 through 2022, are open for examination.

10. RETIREMENT PLAN

The Company has a contributory 401(k) profit sharing plan (the “Plan”) which covers all employees who have attained

age 21 and who have met minimum service requirements. The Company makes quarterly non-discretionary “safe harbor”
matching contributions to the Plan equal to 100% of the basic contribution made by each participant on the first 3% of his or
her compensation plus 50% of the basic contribution made by each participant on the next 2% of his or her compensation.

The Company is also permitted to make discretionary profit sharing contributions to the Plan. There were no profit

sharing contributions for the plan year ended December 31, 2023.

The Company’s total expenses under the Plan were $2.2 million and $2.3 million for fiscal 2023 and fiscal 2022,

respectively.

11. COMMITMENTS AND CONTINGENCIES

From time to time, the Company becomes involved in lawsuits and other claims arising from its ordinary course of

business. Because of the uncertainties related to the incurrence, amount and range of loss on any pending litigation or claim,
management is currently unable to predict the ultimate outcome of any litigation or claim, determine whether a liability has
been incurred or make an estimate of the reasonably possible liability that could result from an unfavorable outcome.
Management believes, after considering a number of factors and the nature of any outstanding litigation or claims, that the
outcome will not have a material effect upon the Company’s results of operations, financial condition or cash flows. However,
because of the unpredictable nature of these matters, the Company cannot provide any assurances regarding the outcome of any
litigation or claim to which it is a party or the impact on it of an adverse ruling in such matters.

12. RECENT ACCOUNTING PRONOUNCEMENTS

Recently Adopted Accounting Pronouncements

Intangibles – Goodwill and Other – Internal-use Software

On February 3, 2020, the Company adopted Accounting Standards Update (“ASU”) No. 2018-15, Intangibles – Goodwill
and Other – Internal-Use Software (Subtopic 350-40) (“ASU 2018-15”) which provides additional guidance on the accounting
for costs of implementation activities performed in a cloud computing arrangement that is a service contract. ASU 2018-15
requires a customer in a cloud computing arrangement that is a service contract to follow the new internal-use software
guidance to determine which implementation costs to capitalize as assets or expense as incurred. The new internal-use software
guidance requires that certain costs incurred during the application development stage be capitalized and other costs incurred
during the preliminary project and post-implementation stages be expensed as they are incurred. The Company adopted ASU
2018-15 using the prospective method. In fiscal 2023 and 2022, $10.1 million and $9.2 million of capitalized costs associated
with implementation activities, net of amortization are classified within Prepaid expenses & other current assets on the
Company’s Consolidated Balance Sheets, respectively, and $5.0 million and $3.6 million of related amortization costs are
included in Selling, general and administrative expenses on the Company’s Consolidated Statement of Operations, respectively.

Financial Instruments – Credit Losses – Measurement of Credit Losses on Financial Instruments

DULUTH HOLDINGS INC.
Notes to Consolidated Financial Statements

In June 2016, the FASB issued Accounting Standards Update No. 2016-13 “Financial Instruments-Credit Losses (Topic

326): Measurement of Credit Losses on Financial Instruments,” (“ASU 2016-13”), which amends the impairment model by
requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of
financial instruments, which include trade and other receivables, loans and held-to-maturity debt securities, to record an
allowance for credit risk based on expected losses rather than incurred losses, otherwise known as “CECL”. In addition, this
guidance changes the recognition for credit losses on available-for-sale debt securities, which can occur as a result of market
and credit risk and requires additional disclosures. On November 15, 2019, the FASB issued ASU No. 2019-10 “Financial
Instruments-Credit Losses (Topic 326), Derivatives and Hedging (Topic 815, and Leases (Topic 842),” (ASU 2019-10”), which
provides a framework to stagger effective dates for future major accounting standards and amends the effective dates for certain
major new accounting standards to give implementation relief to certain types of entities. ASU 2019-10 amends the effective
dates for ASU 2016-13 for smaller reporting companies with fiscal years beginning after December 15, 2022, and interim
periods within those years. The Company adopted ASU 2016-13 on January 30, 2023, the first day of the Company’s first
quarter for the fiscal year ending January 28, 2024, the Company’s fiscal year 2023. ASU 2016-13 did not have a material
impact on the Company’s consolidated financial statements.

Recently Accounting Pronouncements Not Yet Adopted

Segment Reporting – Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting: Improvements to Reportable Segment

Disclosures.” This ASU improves reportable segment disclosure requirements, primarily through enhanced disclosures about
significant segment expenses. In addition, the amendments enhance interim disclosure requirements, clarify circumstances in
which an entity can disclose multiple segment measures of profit or loss, provide new segment disclosure requirements for
entities with a single reportable segment, and contain other disclosure requirements. The new guidance is effective for public
companies with annual periods beginning after December 15, 2023, and interim periods within annual period beginning after
December 15, 2024, with early adoption permitted. Management is currently evaluating the effects adoption of this guidance
will have on its consolidated financial statements.

Income Taxes – Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes: Improvements to Income Tax Disclosures.” This

ASU improves the transparency of income tax disclosures by requiring (i) consistent categories and greater disaggregation of
information in the rate reconciliation and (ii) income taxes paid disaggregated by jurisdiction. This new guidance will be
effective for annual periods beginning after December 15, 2024, and early adoption is permitted. Management is currently
evaluating the effects adoption of this guidance will have on its consolidated financial statements.

DULUTH HOLDINGS INC.
SCHEDULE II
VALUATION AND QUALIFYING ACCOUNTS
For the Years Ended January 28, 2024 and January 29, 2023
(Amounts in thousands)

Beginning
Balance

Charged to
Cost and
Expenses

Charged to
Other
Accounts

Deductions

Ending
Balance

Inventory reserve

Year ended January 28, 2024
Year ended January 29, 2023

Product returns reserve

Year ended January 28, 2024
Year ended January 29, 2023

1,837
2,372

5,168
5,439

$
$

— $
— $

373
$
— $

— $
— $

(476) $
(535) $

— $
(271) $

1,361
1,837

5,541
5,168

See accompanying Report of Independent Registered Public Accounting Firm.

ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE

None.

ITEM 9A.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We have established disclosure controls and procedures, as such term is defined in Rule 13a-15(e) and 15d-15(e) under

the Securities Exchange Act of 1934, as amended (the “Exchange Act”) that are designed to ensure that information required to
be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and
reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file
or submit under the Exchange Act is accumulated and communicated to management, including our principal executive and
principal financial officers as appropriate, to allow timely decisions regarding required disclosure.

The Company carried out an evaluation, under the supervision of and with the participation of our management,
including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and
procedures as of January 28, 2024. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have
concluded that, as of such date, our disclosure controls and procedures were not effective as of January 28, 2024 due to the
material weakness in our internal control over financial reporting, as described below.

In light of the material weakness described below, management performed additional analysis and other procedures to

ensure that our consolidated financial statements were prepared in accordance with accounting principles generally accepted in
the United States of America (“U.S. GAAP”). Accordingly, management believes that the Company’s consolidated financial
statements in this Form 10-K fairly present, in all material respects, our financial position, results of operations and cash flows
as of and for the periods presented, in conformity with U.S. GAAP.

Management’s Annual Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined

in Rules 13a-15(f) and 15d-15(f) under the Exchange Act). Our management, with the participation of our Chief Executive
Officer and Chief Financial Officer, under the oversight of our Audit Committee of the Board of Directors, assessed the
effectiveness of our internal control over financial reporting as of January 28, 2024. In making this assessment, management
used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal
Control – Integrated Framework (2013).

Based on this assessment, management concluded that the Company’s internal control over financial reporting was not

effective as of January 28, 2024, due to the material weakness described below.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such

that there is a reasonable possibility that a material misstatement of our consolidated financial statements will not be prevented
or detected on a timely basis.

The Company did not perform effective risk assessment related to the mapping of general ledger accounts to the

consolidated financial statements resulting in manual controls in the financial reporting process that were not designed to
sufficiently mitigate the risk of incorrect presentation of certain general ledger accounts in the consolidated financial
statements.

The material weakness resulted in immaterial misstatements related to the presentation of prepaid expenses, property and

equipment, and finance lease right-of-use assets, net, on our Consolidated Balance Sheets, Consolidated Statements of Cash
Flows and related notes as of and for each of years ended January 28, 2024 and January 29, 2023, some of which have been
corrected prior to issuance of the consolidated financial statements included in this Form 10-K. Furthermore, the control
deficiency described above created a reasonable possibility that a material misstatement to the consolidated financial statements
would not be prevented or detected on a timely basis. Therefore, we concluded that the deficiency represents a material
weakness in our internal control over financial reporting and, as a result, our internal control over financial reporting was not
effective as of January 28, 2024.

Our independent registered public accounting firm, KPMG LLP, who audited the consolidated financial statements as of

and for the year ended January 28, 2024 included in this Annual Report on Form 10-K, issued an adverse opinion on the

effectiveness of our internal control over financial reporting. KPMG LLP’s report is included in Item 8 of Part II of this Annual
Report on Form 10-K.

Changes in Internal Control Over Financial Reporting

There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under

the Exchange Act), that occurred during the fiscal quarter ended January 28, 2024, that has materially affected, or is reasonable
likely to materially affect, our internal control over financial reporting.

Remediation Plan

To address the material weakness, management has initiated a project to simplify the process related to the mapping of

general ledger accounts to the consolidated financial statements. Management will perform a thorough risk assessment of the
updated process to identify all risk points and design and implement new process-level controls to mitigate the risk of incorrect
presentation of general ledger accounts in the consolidated financial statements.

ITEM 9B.

OTHER INFORMATION

(a) None.
(b) During the three months ended January 28, 2024, no director or Section 16 officer of the Company adopted or

terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined
in Item 408(a) of Regulation S-K.

ITEM 9C.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

PART III

Information required by this Item concerning our directors, audit committee, and audit committee financial experts and
compliance with Section 16(a) of the Exchange Act is incorporated by reference to information under the captions “Proposal
One: Election of Directors” and “Delinquent Section 16(a) Reports” in our definitive proxy statement for our 2024 annual
meeting of shareholders to be held on May 23, 2024 (the “Proxy Statement”). It is anticipated that our Proxy Statement will be
filed with the Securities and Exchange Commission on or about April 5, 2024.

We have adopted a code of business conduct and ethics that applies to our directors, officers and employees, including

our principal executive officer, principal financial officer and principal accounting officer. We have posted the code of business
conduct and ethics on our website at http://ir.duluthtrading.com under the tab “Corporate Governance—Documents &
Charters—Code of Business Conduct and Ethics.” We intend to satisfy our disclosure requirements under Item 5.05 of Form 8-
K regarding amendments to, or waiver of, any provisions of our code of business conduct and ethics that applies to our
principal executive officer, principal financial officer and principal accounting officer and our directors by posting such
information to our website.

Our code of business conduct and ethics is available in print for any shareholder who requests it by writing to: Secretary,

Duluth Holdings Inc., 201 East Front Street, Mount Horeb, Wisconsin, 53572. We are not including the information available
on or through our website as part of, or incorporating such information by reference into, this Annual Report on Form 10-K.

Pursuant to General Instruction G(3), certain information with respect to our executive officers is set forth under the

caption “Information about Our Executive Officers” as of March 22, 2024 in this Annual Report on Form 10-K.

ITEM 11.

EXECUTIVE COMPENSATION

Information required by this Item is incorporated by reference to the sections of the Proxy Statement entitled “Executive

Compensation,” “Director Compensation,” and “Compensation Committee Interlocks and Insider Participation.”

ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
SHAREHOLDER MATTERS

Information required by this Item is incorporated by reference to the sections of the Proxy Statement entitled “Security

Ownership of Certain Beneficial Owners.” Further, information required by this Item concerning our Equity Compensation
Plan Information is incorporated by reference to the section of the Proxy Statement entitled “Proposal Four: Approval of the
2024 Equity Incentive Plan of Duluth Holdings, Inc.”.

ITEM 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

Information required by this Item is incorporated by reference to the sections of the Proxy Statement entitled “Certain

Relationships and Related Party Transactions” and “Proposal One: Election of Directors.”

ITEM 14.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

Information required by this Item is incorporated by reference to the section of the Proxy Statement entitled “Audit

Committee Report.”

ITEM 15.

EXHIBITS, FINANCIAL STATEMENTS AND SCHEDULE

(a)(2) Financial Statements and Financial Statement Schedule

PART IV

See “Index to Consolidated Financial Statements” in Part II, Item 8 of this Annual Report on Form 10-K. Schedule II is
included in Part II, Item 8. All other financial statement schedules have been omitted because they are not required or are not
applicable or because the information required in those schedules either is not material or is included in the consolidated
financial statements or the accompanying notes.

(a)(3) Exhibits

Exhibit No.
3.1

3.2

4.1
9.1

10.1+
10.2+

10.3+

10.4

10.5

10.6
10.7

10.8+

10.9+

10.10+

10.11+

10.12+

10.13+

Amended and Restated Articles of Incorporation of Duluth Holdings Inc., incorporated by reference to
Exhibit 3.1 of Pre-Effective Amendment No. 2 to the Company’s Registration Statement on Form S-1 (File
No. 333-207300), filed November 9, 2015.
Amended and Restated Bylaws of Duluth Holdings Inc., incorporated by reference to Exhibit 3.2 of the Pre-
Effective Amendment No. 2 to the Company’s Registration Statement on Form S-1 (File No. 333-207300),
filed November 9, 2015.
Description of Registrant’s Securities.
Voting Trust Agreement, dated November 1, 2021, by and between Stephen L. Schlecht, as trustee, and
Duluth Holdings Inc., incorporated by reference to Exhibit 9.1 of the Company’s Annual Report on Form 10-
K filed March 25, 2022.
Summary of Outside Director Compensation Program.*
2015 Equity Incentive Plan of Duluth Holdings Inc., incorporated by reference to Exhibit 10.7 of the
Company’s Quarterly Report on Form 10-Q, filed December 18, 2015.
Form of Restricted Stock Agreement for non-employee directors under the 2015 Equity Incentive Plan,
incorporated by reference to Exhibit 10.17 of the Company’s Registration Statement on Form S-1 (File No.
333-207300), filed October 6, 2015.
Commercial Lease between Schlecht Retail Ventures LLC and Duluth Holdings Inc., dated February 14,
2010 (100 West Main Street, Mt. Horeb, Wisconsin), incorporated by reference to Exhibit 10.19 of the
Company’s Registration Statement on Form S-1 (File No. 333-207300), filed October 6, 2015.
Form of S Corporation Termination, Tax Allocation and Indemnification Agreement among Duluth Holdings
Inc. and shareholders of Duluth Holdings Inc., incorporated by reference to Exhibit 10.23 of Pre-Effective
Amendment No. 1 to the Company’s Registration Statement on Form S-1 (File No. 333-207300), filed
October 13, 2015.
Annual Incentive Plan, As Amended February 21, 2018.
Form of Restricted Stock Agreement for executives under the 2015 Equity Incentive Plan, incorporated by
reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q dated May 1, 2016.+
Form of Restrictive Covenant Agreement, incorporated by reference to Exhibit 10.2 of the Company’s
Current Report on Form 8-K dated July 24, 2017.
First Amended and Restated Employment Agreement, dated as of May 27, 2021, between Stephen L.
Schlecht and the Company, incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on
Form 10-Q dated September 3, 2021.
Employment Agreement between Duluth Holdings Inc. and Samuel M. Sato dated May 3, 2021, incorporated
by reference to Exhibit 10.3 of the Company’s Quarterly Report on 10-Q dated June 4, 2021.
Offer Letter Dated July 14, 2017 by and between Dave Loretta and Duluth Holdings Inc., incorporated by
reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K dated July 24, 2017.
Offer Letter dated January 24, 2020 by and between David S. Homolka and Duluth Holdings Inc.,
incorporated by reference to Exhibit 10.18 of the Company’s Annual Report on Form 10-K, filed March 25,
2022.
Offer Letter dated January 24, 2020 by and between Richard W. Schlecht and Duluth Holdings Inc.,
incorporated by reference to Exhibit 10.19 of the Company’s Annual Report on Form 10-K, filed March 25,
2022.

10.14

10.15

10.16+

10.17+

10.18

10.19+

10.20+

10.21+

10.22+

23.1
24.1
31.1

31.2

32.1

32.2

Credit Agreement, dated as of May 14, 2021, among Duluth Holdings Inc., the Lenders party thereto, Bank
of America, N.A., as Administrative Agent, Swingline Lender and L/C Issuer, BofA Securities, Inc., as a
Joint Lead Arranger and Sole Bookrunner, and Keybanc Capital Markets Inc., as a Joint Lead Arranger,
incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K dated May 14,
2021.
Security Agreement, dated as of May 14, 2021, by and between Duluth Holdings Inc. and Bank of America,
N.A., incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K dated May
14, 2021.
Duluth Holdings Inc. Executive Change in Control Severance Plan incorporated by reference to Exhibit 10.1
of the Company’s Current Report on Form 8-K dated April 14, 2022.
Duluth Holdings Inc. Executive General Severance Plan Incorporated by reference to Exhibit 10.2 of the
Company’s Current Report on Form 8-K dated April 14, 2022.
First Amendment, dated as of July 8, 2022, among Duluth Holdings Inc., the Lenders party thereto, Bank of
America, N.A., as Administrative Agent, Swingline Lender and L/C Issuer, BofA Securities, Inc., as a Joint
Lead Arranger and Sole Bookrunner, and Keybanc Capital Markets Inc., as a Joint Lead Arranger,
incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K dated July 8, 2022.
Offer Letter dated March 14, 2022 by and between Neala Shepherd and Duluth Holdings Inc., incorporated
by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K dated July 8, 2022.
Offer Letter dated July 27, 2022 by and between Albert J. Sutera and Duluth Holdings Inc., incorporated by
reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q dated September 2, 2022.
Offer Letter dated January 17, 2024 by and between Heena Agrawal and Duluth Holdings Inc., incorporated
by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K dated January 18, 2024.
Inducement Restricted Stock Award Agreement, dated February 12, 2024, by and between Heena Agrawal
and Duluth Holdings Inc., incorporated by reference to the Company’s Current Report on Form 8-K dated
February 12, 2024.
Consent of KPMG LLP.*
Power of Attorney.*
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities and
Exchange Act, as amended.*
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities and
Exchange Act of 1934, as amended.*
Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.*
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.*
Executive Officer Compensation Recovery Policy.*

101.INS

XBRL Instance Document**

101.SCH

XBRL Taxonomy Extension Schema Document**

101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document**

101.DEF
101.LAB
101.PRE
104

XBRL Taxonomy Extension Definition Document**
XBRL Taxonomy Extension Label Linkbase Document**
XBRL Taxonomy Extension Presentation Linkbase Document**
Cover Page interactive data file (formatted as inline XBRL and contained in Exhibit 101)

Indicates a management contract or compensation plan or arrangement
Filed herewith

+
*
** In accordance with Regulation S-T, the XBRL-related information in Exhibit 101 to this Annual Report on Form 10-K shall be

deemed to be “furnished” and not “filed.”

ITEM 16.

FORM 10-K SUMMARY

Not applicable.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly

caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Signatures

DULUTH HOLDINGS INC.

By:

/s/ Samuel M. Sato
Samuel M. Sato
President and Chief Executive Officer

DATE: March 22, 2024

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following

persons on behalf of the registrant and in the capacities indicated and on the dates indicated.

Name

Title

/s/ Samuel M. Sato
Samuel M. Sato

/s/ Heena K. Agrawal
Heena K. Agrawal

/s/ Michael Murphy
Michael Murphy

President and
Chief Executive Officer
(Principal Executive Officer)

Senior Vice President and
Chief Financial Officer
(Principal Financial Officer)

Vice President and Treasury
Chief Accounting Officer
(Principal Accounting Officer)

Date

March 22, 2024

Directors: Samuel M. Sato, Brett L. Paschke, Francesca M. Edwardson, Janet H. Kennedy, David C. Finch, Susan J. Riley,
Stephen L. Schlecht, Scott K. Williams and Ronald Robinson.

By:

/s/ Samuel M. Sato
Samuel M. Sato
Attorney-In-Fact*

March 22, 2024

*Pursuant to authority granted by powers of attorney, copies of which are filed herewith.

EXECUTIVE MANAGEMENT
EXECUTIVE MANAGEMENT

CORPORATE INFORMATION
CORPORATE INFORMATION

Samuel M. Sato
Samuel M. Sato
President and Chief Executive Officer
President and Chief Executive Officer

Heena K. Agrawal
Heena K. Agrawal
Senior Vice President and Chief Financial Officer
Senior Vice President and Chief Financial Officer

Albert J. Sutera
Albert J. Sutera
Senior Vice President and Chief Technology
Senior Vice President and Chief Technology
Officer and Logistics
Officer and Logistics

David S. Homolka
David S. Homolka
Senior Vice President of Talent, DE&I and
Senior Vice President of Talent, DE&I and
Retail Operations
Retail Operations

Richard W. Schlecht
Richard W. Schlecht
Senior Vice President of Product Development
Senior Vice President of Product Development
and Sourcing
and Sourcing

Neala K. Shepherd
Neala K. Shepherd
Senior Vice President of Brand and Marketing
Senior Vice President of Brand and Marketing

BOARD OF DIRECTORS
BOARD OF DIRECTORS
Stephen L. Schlecht
Stephen L. Schlecht
Chairman and Founder
Chairman and Founder

Samuel M. Sato
Samuel M. Sato
President and Chief Executive Officer
President and Chief Executive Officer

Francesca M. Edwardson
Francesca M. Edwardson
Former Chief Executive Officer
Former Chief Executive Officer
American Red Cross of Chicago and
American Red Cross of Chicago and
Northern Illinois
Northern Illinois

David C. Finch
David C. Finch
Former Chief Executive Officer
Former Chief Executive Officer
Daniele International, LLC
Daniele International, LLC

Janet H. Kennedy
Janet H. Kennedy
Former Vice President
Former Vice President
North America Regions of Google Cloud
North America Regions of Google Cloud
Alphabet, Inc.
Alphabet, Inc.

Brett L. Paschke
Brett L. Paschke
Managing Partner
Managing Partner
WinForest Partners
WinForest Partners

Susan J. Riley
Susan J. Riley
Former President and Chief Executive Officer
Former President and Chief Executive Officer
PJM Interconnection
PJM Interconnection

Ronald Robinson
Ronald Robinson
Chief Supply Chain Officer
Chief Supply Chain Officer
Designer Brands, Inc.
Designer Brands, Inc.

Scott K. Williams
Scott K. Williams
Chief Executive Officer
Chief Executive Officer
Batteries Plus Bulbs
Batteries Plus Bulbs

Corporate Offices
Corporate Offices
Duluth Trading Company
Duluth Trading Company
201 East Front Street
201 East Front Street
Mount Horeb, WI 53572
Mount Horeb, WI 53572
Tel: 608-424-1544
Tel: 608-424-1544
Web: duluthtrading.com
Web: duluthtrading.com

Independent Auditors
Independent Auditors
KPMG LLP
KPMG LLP

Registrar and Transfer Agent
Registrar and Transfer Agent
Computershare
Computershare
150 Royall Street, Suite 101
150 Royall Street, Suite 101
Canton, MA 02021
Canton, MA 02021
Tel: 877-736-3001
Tel: 877-736-3001
Web: www.computershare.com/us
Web: www.computershare.com/us

Class B Common Stock
Class B Common Stock
NASDAQ Global Select Market
NASDAQ Global Select Market
Symbol: DLTH
Symbol: DLTH

Form 10-K and Other Reports
Form 10-K and Other Reports
Our Annual Report on Form 10-K, charters
Our Annual Report on Form 10-K, charters
of the Board’s committees, and our code of
of the Board’s committees, and our code of
ethics are made available on our website:
ethics are made available on our website:
ir.duluthtrading.com. Shareholders may
ir.duluthtrading.com. Shareholders may
request printed copies (which will be provided
request printed copies (which will be provided
free of charge) from Investor Relations.
free of charge) from Investor Relations.
Email: DuluthIR@icrinc.com
Email: DuluthIR@icrinc.com

The SEC also maintains a website that contains
The SEC also maintains a website that contains
reports, proxy information, statements, and
reports, proxy information, statements, and
other information regarding registrants who
other information regarding registrants who
file electronically with the SEC. The website
file electronically with the SEC. The website
address is: www.sec.gov
address is: www.sec.gov

Forward-Looking Statements
Forward-Looking Statements
This Annual Report contains “forward-looking
This Annual Report contains “forward-looking
statements” within the meaning of the Private
statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. All
Securities Litigation Reform Act of 1995. All
forward-looking statements are subject to risk
forward-looking statements are subject to risk
and uncertainties which could cause actual
and uncertainties which could cause actual
results to vary materially from such statements
results to vary materially from such statements
including the risks and uncertainties described
including the risks and uncertainties described
under Part I, Item 1A “Risk Factors,” in our
under Part I, Item 1A “Risk Factors,” in our
Annual Report on Form 10-K for the fiscal year
Annual Report on Form 10-K for the fiscal year
ended January 28, 2024.
ended January 28, 2024.

D
D
D
U
U
U
L
L
L
U
U
U
T
T
T
H
H
H

H
H
H
O
O
O
L
L
L
D
D
D

I
I
I

N
N
N
G
G
G
S
S
S

I
I
I

N
N
N
C
C
C

.
.
.

2
2
2
0
0
0
2
2
2
3
3
3

A
A
A
N
N
N
N
N
N
U
U
U
A
A
A
L
L
L

R
R
R
E
E
E
P
P
P
O
O
O
R
R
R
T
T
T

®
®
®

DULUTH HOLDINGS INC. 2023 ANNUAL REPORT