Company Posts 4.4% Increase in Net
Sales
Sees Positive Impact from TCS Closets® and
SG&A Savings Initiatives
Launches its New Customer Financing
Program
The Container Store Group, Inc. (NYSE: TCS) (the
“Company”), today announced financial results for the first quarter
of fiscal 2016 ended July 2, 2016. In light of the Company’s
previously announced fiscal year end change, all references to
prior year results are based on the recast 13 weeks ended July 4,
2015.
- Consolidated net sales were $177.4
million, up 4.4%. Net sales in The Container Store retail business
were $161.2 million, up 5.1%. Elfa International AB third-party net
sales were $16.2 million, down 1.8%.
- Comparable store sales for the first
quarter of fiscal 2016 were down 1.4% based on the new comparable
store sales reporting method, or down 0.2% based on the prior
reporting method (see "Change in Comparable Store Sales Reporting
Method" section in this press release for detail on the new
reporting method).
- Consolidated net loss per diluted share
(EPS) was ($0.04) compared with ($0.12) in the first quarter ended
July 4, 2015. The ($0.04) is inclusive of an approximate $0.05
benefit from new employment arrangements entered into with key
executives during the quarter.
- The Company opened one new store in the
first quarter of 2016 and plans to open an additional seven
locations (inclusive of one relocation) in the remainder of fiscal
2016, opening two stores in the second quarter and the remaining
five in the second half of fiscal 2016. The Company had 80 stores
at the end of the first quarter of fiscal 2016, as compared to 72
as of July 4, 2015.
- On July 12, 2016, the Company launched
its previously announced Customer Financing Program through
Synchrony Financial.
Melissa Reiff, Chief Executive Officer, stated, “In our first
fiscal quarter of 2016, we saw a benefit from the strategic
investments and ‘closet domination’ focused initiatives we
implemented in fiscal year 2015. TCS Closets was again a key driver
of comparable store sales performance providing a 230 basis point
lift. And, we improved our operating profitability, as we
maintained strong gross margins and delivered SG&A
efficiencies.”
Reiff continued, “Looking ahead to the rest of the year, we
remain committed to maximizing the targeted results of our fiscal
year 2016 SG&A savings program. While we are encouraged by the
progress being made and resulting improvement in our bottom line
performance, we still have work to do on the top line. My primary
focus in my new role, in collaboration with our leadership team, is
to drive consistent sales and profit growth, all with our continued
commitment to The Container Store’s principled way of doing
business.”
First Quarter 2016
Results
For the first quarter ended July 2, 2016, on a consolidated
basis:
- Net sales were $177.4 million, up 4.4%
as compared to the first quarter ended July 4, 2015. Net sales in
The Container Store retail business were $161.2 million, up 5.1%,
with the increase driven by new store sales, which more than offset
the comparable store sales decline of 1.4% (or a decline of 0.2%
under the prior reporting method). Elfa third-party net sales
declined $0.3 million compared to the first quarter ended July 4,
2015, primarily due to lower sales in Russia, partially offset by
the positive impact of foreign currency translation during the
quarter.
- Gross margin was 59.0%, an increase of
40 basis points compared to the first quarter ended July 4,
2015. The Container Store retail business gross margin
declined 10 basis points to 58.6% as a growing mix of lower margin
products and services was partially offset by the impact of a
stronger U.S. dollar. Elfa gross margin improved 330 basis points
primarily due to lower direct materials costs and production
efficiencies. On a consolidated basis, gross margin increased 40
basis points, as the decline in The Container Store retail business
gross margin was more than offset by the increase in the Elfa gross
margin.
- Selling, general and administrative
expenses (“SG&A”) decreased by 2.1% to $92.3 million from $94.3
million in the first quarter ended July 4, 2015. SG&A as a
percentage of net sales decreased 350 basis points. This was
primarily due to the impact of amended and restated employment
agreements entered into with key executives during the first
quarter of fiscal 2016, leading to the reversal of accrued deferred
compensation associated with the original employment agreements,
net of costs incurred to execute the agreements, of $3.9 million,
or 220 basis points. Additionally, the Company’s SG&A savings
program contributed, in part, to decreased spending on certain
major initiatives and decreased 401(k) costs. The Company also
experienced lower healthcare costs during the quarter.
- Net interest expense decreased to $4.1
million from $4.2 million in the first quarter ended July 4,
2015.
- The effective tax rate was 33.3%, as
compared to 36.8% in the first quarter ended July 4, 2015. The
decrease in the effective tax rate is primarily due to a shift in
the mix of domestic and foreign earnings.
- Net loss was $2.1 million, or ($0.04)
per share, in the first quarter of fiscal 2016 compared to net loss
of $5.8 million, or ($0.12) per share in the first quarter ended
July 4, 2015. The net loss of $2.1 million in the first quarter of
fiscal 2016 includes a benefit from the impact of amended and
restated employment agreements entered into with key executives
during the quarter, net of costs incurred related to management
transition and income taxes, of approximately $2.2 million, or
$0.05 per share.
- Adjusted EBITDA was $12.0 million in
the first quarter of fiscal 2016 compared to $4.7 million in the
first quarter ended July 4, 2015 (see GAAP/Non-GAAP reconciliation
table). The Adjusted EBITDA of $12.0 million in the first quarter
of fiscal 2016 includes a benefit from the impact of amended and
restated employment agreements entered into with key executives
during the quarter, net of costs incurred to execute the
agreements, of $3.9 million.
Balance sheet highlights:
(In thousands) July 2,
2016 July 4, 2015 Cash $8,189 $8,397 Total
debt, net of deferred financing costs $337,990 $356,603 Liquidity*
$78,598 $63,602 *Cash plus availability on revolving credit
facilities
Change in Comparable Store Sales Reporting Method
In the first quarter of fiscal 2016, the Company changed its
comparable store sales operating measure to reflect the point at
which merchandise and service orders are fulfilled and delivered to
customers, excluding shipping and delivery. Prior to the first
quarter of fiscal 2016, the comparable store sales operating
measure in a given period was based on merchandise and service
orders placed in that period, excluding shipping and delivery,
which did not always reflect when the merchandise and services were
received by the customer and, therefore, recognized in the
Company’s financial statements as net sales. This revision has no
impact on prior, or current, period reported net sales. The Company
believes that changing the comparable store sales operating metric
to better align with net sales presented in the Company’s financial
statements will assist investors in evaluating our financial
performance. See Recast Operating Data table for recast quarterly
and full year fiscal 2015 comparable store sales on this revised
basis.
Change in Fiscal Year
As previously disclosed, the Company changed its fiscal year end
from the Saturday closest to February 28 to the Saturday closest to
March 31 of each year. The fiscal year change was effective
beginning with the Company’s current 2016 fiscal year, which began
on April 3, 2016 and will end on April 1, 2017. Recast historical
unaudited quarterly and full year financial information for fiscal
2015 is included in this press release, as well as posted on the
Company’s website under the Investor Relations link. As recast, the
first quarter of fiscal 2015 would have ended on July 4, 2015; the
second quarter of fiscal 2015 would have ended on October 3, 2015;
the third quarter of fiscal 2015 would have ended on January 2,
2016; and the fourth quarter and full fiscal year 2015 would have
ended on April 2, 2016.
Outlook
The Company is maintaining its fiscal 2016 Outlook expecting
consolidated net sales to be $830 to $845 million, based on its
planned store openings, and a comparable store sales range of -1.5%
to +0.5%. Net income is still expected to be $0.20 to $0.30 per
diluted common share based on estimated diluted common shares
outstanding of 49 million. This assumes a tax rate of approximately
39% for the full year.
Conference Call Information
A conference call to discuss first quarter fiscal 2016 financial
results is scheduled for today, August 9, 2016, at 4:30 PM Eastern
Time. Investors and analysts interested in participating in the
call are invited to dial (877) 407-3982 (international callers
please dial (201) 493-6780) approximately 10 minutes prior to the
start of the call. A live audio webcast of the conference call will
be available online at www.containerstore.com in the investor
relations section of the website.
A taped replay of the conference call will be available within
two hours of the conclusion of the call and can be accessed both
online and by dialing (877) 870-5176 (international replay number
is (858) 384-5517). The pin number to access the telephone replay
is 13640929. The replay will be available through September 9, 2016
at 11:59 PM Eastern Time.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. All statements contained in this press release that do not
relate to matters of historical fact should be considered
forward-looking statements, including expectations regarding
driving consistent sales and profit growth, expectations for new
store openings and relocations, and statements regarding our
anticipated financial performance.
These forward-looking statements are based on management’s
current expectations. These statements are neither promises nor
guarantees, but involve known and unknown risks, uncertainties and
other important factors that may cause our actual results,
performance or achievements to be materially different from any
future results, performance or achievements expressed or implied by
the forward-looking statements, including, but not limited to, the
following: our inability to successfully implement our planned
fiscal 2016 initiatives in the timeframe we expect or at all; our
inability to open or relocate new stores in the timeframe and at
the locations we anticipate; overall decline in the health of the
economy, consumer spending, and the housing market; our inability
to manage costs and risks relating to new store openings; our
inability to source and market new products to meet consumer
preferences; our failure to achieve or maintain profitability; our
dependence on a single distribution center for all of our stores;
effects of a security breach or cyber-attack of our website or
information technology systems; our vulnerability to natural
disasters and other unexpected events; our reliance upon
independent third party transportation providers; our inability to
protect our brand; our failure to successfully anticipate consumer
preferences and demand; our inability to manage our growth;
inability to locate available retail store sites on terms
acceptable to us; our inability to maintain sufficient levels of
cash flow to meet growth expectations; disruptions in the global
financial markets leading to difficulty in borrowing sufficient
amounts of capital to finance the carrying costs of inventory to
pay for capital expenditures and operating costs; fluctuations in
currency exchange rates; our inability to effectively manage our
online sales; competition from other stores and internet based
competition; our inability to obtain merchandise on a timely basis
at competitive prices as a result of changes in vendor
relationships; vendors may sell similar or identical products to
our competitors; our reliance on key executive management, and the
transition in our executive leadership; our inability to find,
train and retain key personnel; labor relations difficulties;
increases in health care costs and labor costs; our dependence on
foreign imports for our merchandise; violations of the U.S. Foreign
Corrupt Practices Act and similar worldwide anti bribery and
anti-kickback laws; and our indebtedness may restrict our current
and future operations.
These and other important factors discussed under the caption
“Risk Factors” in our Annual Report on Form 10-K filed with
the Securities and Exchange Commission, or SEC, on May 10, 2016,
and our other reports filed with the SEC could cause actual results
to differ materially from those indicated by the forward-looking
statements made in this press release. Any such forward-looking
statements represent management’s estimates as of the date of this
press release. While we may elect to update such forward-looking
statements at some point in the future, we disclaim any obligation
to do so, even if subsequent events cause our views to change.
These forward-looking statements should not be relied upon as
representing our views as of any date subsequent to the date of
this press release.
About The Container Store
The Container Store (NYSE: TCS) is the nation’s leading retailer
of storage and organization products and the only retailer solely
devoted to the storage and organization category of retailing. The
company originated the concept of storage and organization
retailing when it opened its first store in 1978. Today, the
retailer has 80 store locations nationwide that each average 25,000
square feet. The Container Store has over 11,000 products to help
customers save space and, ultimately, save them time. As the pace
of modern life accelerates and being organized is not a luxury
anymore but a necessity, The Container Store is devoted to making
customers more productive, relaxed and happier by selling
customized, complete solutions. Since its inception, the retailer
has nurtured an employee-first culture and couples its one-of-kind
product collection with a high level of customer service delivered
by its highly trained organization experts. The company has been
named to FORTUNE magazine’s 100 Best Companies To Work For® — 17
years in a row. Visit www.containerstore.com for more information
about store locations, the product collection and services offered.
To find out more about The Container Store’s unique culture,
Foundation PrinciplesTM and devotion to Conscious Capitalism®,
visit the retailer’s blog at www.whatwestandfor.com.
The Container Store Group, Inc.
Consolidated statements of operations (unaudited)
(In thousands, except share and per
share amounts)
Thirteen Weeks Ended
Five WeeksEnded
July 2, 2016 July 4, 2015
April 2, 2016 Net sales $177,448 $169,958 $69,218 Cost of
sales (excluding depreciation and amortization) 72,753
70,447 29,023 Gross profit 104,695 99,511 40,195 Selling,
general, and administrative expenses (excluding depreciation and
amortization) 92,313 94,284 34,504 Stock-based compensation 365 327
147 Pre-opening costs 1,096 1,640 191 Depreciation and amortization
9,347 8,231 3,009 Other expenses 549
-
102 (Loss) gain on disposal of assets (3) 10
-
Gain (loss) from operations 1,028 (4,981) 2,242 Interest expense,
net 4,110 4,173 1,550 (Loss) income before taxes
(3,082) (9,154) 692 (Benefit) provision for income taxes (1,025)
(3,366) 338 Net (loss) income $(2,057) $(5,788) $354
Basic and diluted net (loss) income per common share $(0.04)
$(0.12) $0.01 Weighted-average common shares - basic and diluted
47,986,975 47,983,785 47,986,975
The Container Store Group, Inc.
Consolidated balance sheets
(unaudited)
(In thousands, except share and per share
amounts) July 2, February 27, July 4,
2016
2016 2015 Assets Current assets: Cash
$8,189 $13,609 $8,397 Accounts receivable, net 25,035 28,843 21,415
Inventory 104,144 86,435 109,246 Prepaid expenses 14,817 8,692
13,456 Income taxes receivable 770 157 1,186 Deferred tax assets,
net
-
-
3,256 Other current assets 9,852 8,695 10,535 Total
current assets 162,807 146,431 167,491 Noncurrent assets: Property
and equipment, net 173,937 176,117 173,255 Goodwill 202,815 202,815
202,815 Trade names 228,699 228,368 229,749 Deferred financing
costs, net 389 419 222 Noncurrent deferred tax assets, net 1,269
2,090 2,213 Other assets 1,826 1,879 1,808 Total
noncurrent assets 608,935 611,688 610,062 Total
assets $771,742
$758,119 $777,553
Liabilities and
shareholders’ equity Current liabilities: Accounts payable
$51,552 $40,274 $49,505 Accrued liabilities 62,220 69,635 55,262
Revolving lines of credit 5,982 721 10,379 Current portion of
long-term debt 5,464 5,373 5,307 Income taxes payable - -
56 Total current liabilities 125,218 116,003 120,509
Noncurrent liabilities: Long-term debt, net of deferred financing
costs 326,544 316,135 340,917 Noncurrent deferred tax liabilities,
net 79,922 80,720 80,293 Deferred rent and other long-term
liabilities 33,532 38,193 37,781 Total noncurrent
liabilities 439,998 435,048 458,991 Total liabilities
565,216 551,051 579,500 Shareholders’ equity:
Common stock, $0.01 par value, 250,000,000
sharesauthorized; 47,986,975 shares issued at July 2, 2016
andFebruary 27, 2016; 47,983,804 shares issued at July 4, 2015
480 480 480 Additional paid-in capital 857,381 856,879 855,775
Accumulated other comprehensive loss (19,175) (19,835) (17,452)
Retained deficit (632,160) (630,456) (640,750) Total
shareholders’ equity 206,526 207,068 198,053 Total
liabilities and shareholders’ equity $771,742
$758,119 $777,553
The Container
Store Group, Inc.
Consolidated statements of cash flows
(unaudited)
Five Weeks Thirteen
Weeks Ended Ended (In thousands) (unaudited)
July 2, July 4, April 2,
2016 2015 2016 Operating
activities Net (loss) income $(2,057) $(5,788) $354 Adjustments
to reconcile net loss to net cash used in operating activities:
Depreciation and amortization 9,347 8,231 3,009 Stock-based
compensation 365 327 147 (Gain) loss on disposal of property and
equipment (3) 10 - Deferred tax (benefit) expense (922) (3,424) 958
Noncash interest 480 489 160 Other (153) 219 45 Changes in
operating assets and liabilities: Accounts receivable (2,836) (760)
6,958 Inventory (19,283) (20,542) 1,516 Prepaid expenses and other
assets 244 260 (7,371) Accounts payable and accrued liabilities
18,497 6,197 (14,258) Income taxes 175 (1,422) (859) Other
noncurrent liabilities (4,523) (205) (199) Net cash
used in operating activities (669) (16,408) (9,540)
Investing activities Additions to property and equipment
(8,013) (12,199) (2,435) Proceeds from sale of property and
equipment 7 191 1 Net cash used in investing
activities (8,006) (12,008) (2,434)
Financing
activities Borrowings on revolving lines of credit 11,530
15,016 4,958 Payments on revolving lines of credit (9,017) (11,890)
(2,072) Borrowings on long-term debt 12,000 23,000 5,000 Payments
on long-term debt (6,355) (1,327) (944) Proceeds from the exercise
of stock options - 1 - Net cash provided by financing
activities 8,158 24,800 6,942 Effect of exchange rate
changes on cash (103) 494 232 Net decrease in cash
(620) (3,122) (4,800) Cash at beginning of period 8,809
11,519 13,609 Cash at end of period $8,189 $8,397 $8,809
Supplemental information for non-cash investing and
financing activities: Purchases of property and equipment (included
in accounts payable) $751 $750 $1,114 Capital lease obligation
incurred $147 $237 $60
Note Regarding Non-GAAP Information
This press release includes financial measures that are not
calculated in accordance with GAAP, including adjusted EBITDA. The
Company has reconciled these non-GAAP financial measures with the
most directly comparable GAAP financial measures in a table
accompanying this release. These non-GAAP measures should not be
considered as alternatives to net income (loss) as a measure of
financial performance or cash flows from operations as a measure of
liquidity, or any other performance measure derived in accordance
with GAAP and they should not be construed as an inference that the
Company’s future results will be unaffected by unusual or
non-recurring items. These non-GAAP measures are key metrics used
by management, the Company’s board of directors, and Leonard Green
and Partners, L.P., its controlling stockholder, to assess its
financial performance. The Company presents these non-GAAP measures
because it believes they assist investors in comparing the
Company’s performance across reporting periods on a consistent
basis by excluding items that the Company does not believe are
indicative of its core operating performance and because the
Company believes it is useful for investors to see the measures
that management uses to evaluate the Company. These non-GAAP
measures are also frequently used by analysts, investors and other
interested parties to evaluate companies in the Company’s industry.
In evaluating these non-GAAP measures, you should be aware that in
the future the Company will incur expenses that are the same as or
similar to some of the adjustments in this presentation. The
Company’s presentation of these non-GAAP measures should not be
construed to imply that its future results will be unaffected by
any such adjustments. Management compensates for these limitations
by relying on our GAAP results in addition to using non-GAAP
measures supplementally. These non-GAAP measures are not
necessarily comparable to other similarly titled captions of other
companies due to different methods of calculation.
The Company defines EBITDA as net income before interest, taxes,
depreciation, and amortization. Adjusted EBITDA is calculated in
accordance with its credit facilities and is one of the components
for performance evaluation under its executive compensation
programs. Adjusted EBITDA reflects further adjustments to EBITDA to
eliminate the impact of certain items, including certain non cash
and other items that the Company does not consider in its
evaluation of ongoing operating performance from period to period
as discussed further below. The Company uses Adjusted EBITDA in
connection with covenant compliance and executive performance
evaluations, and to supplement GAAP measures of performance to
evaluate the effectiveness of its business strategies, to make
budgeting decisions and to compare its performance against that of
other peer companies using similar measures. The Company believes
it is useful for investors to see the measures that management uses
to evaluate the Company, its executives and its covenant
compliance, as applicable. EBITDA and Adjusted EBITDA are also
frequently used by analysts, investors and other interested parties
to evaluate companies in the Company’s industry.
The Container Store Group, Inc.
Supplemental Information - Reconciliation of GAAP to Non-GAAP
Financial Measures
(In thousands, except share and per
share amounts)
(unaudited)
The table below reconciles the non-GAAP financial measure
adjusted EBITDA with the most directly comparable GAAP financial
measure of GAAP net loss.
Thirteen Weeks Ended
July 2, 2016 July 4, 2015
Net loss $(2,057) $(5,788) Depreciation and amortization 9,347
8,231 Interest expense, net 4,110 4,173 Income tax benefit (1,025)
(3,366) EBITDA $10,375 $3,250 Pre-opening costs (a) 1,096
1,640 Noncash rent (b) (418) (670) Stock-based compensation (c) 365
327 Foreign exchange losses (gains) (d) 42 176 Other adjustments
(e) 572 14 Adjusted EBITDA $12,032 $4,737 (a)
Non-capital expenditures associated with opening new
stores and relocating stores, including rent, marketing expenses,
travel and relocation costs, and training costs. We adjust for
these costs to facilitate comparisons of our performance from
period to period. (b) Reflects the extent to which our
annual GAAP rent expense has been above or below our cash rent
payment due to lease accounting adjustments. The adjustment varies
depending on the average age of our lease portfolio (weighted for
size), as our GAAP rent expense on younger leases typically exceeds
our cash cost, while our GAAP rent expense on older leases is
typically less than our cash cost. (c) Non-cash charges
related to stock-based compensation programs, which vary from
period to period depending on volume and vesting timing of awards.
We adjust for these charges to facilitate comparisons from period
to period. (d) Realized foreign exchange transactional
gains/losses our management does not consider in our evaluation of
our ongoing operations. (e) Other adjustments include
amounts our management does not consider in our evaluation of our
ongoing operations, including certain severance and other charges.
The Container Store
Group, Inc. Recast consolidated statements of operations
(unaudited)
Thirteen Thirteen Thirteen Thirteen
Fifty-two
Weeks
Weeks
Weeks
Weeks
Weeks
(In thousands, except share and per
share amounts)
Ended
Ended
Ended
Ended
Ended
July 4, 2015 October 3, 2015
January 2, 2016 April 2, 2016
April 2, 2016 Net sales $169,958 $204,412 $212,836 $209,881
$797,087 Cost of sales (excluding depreciation and amortization)
70,447 86,139 87,402 88,606 332,594
Gross profit 99,511 118,273 125,434 121,275 464,493
Selling, general, and administrative
expenses(excluding depreciation and amortization)
94,284 96,068 103,867 100,366 394,585 Stock-based compensation 327
373 488 387 1,575 Pre-opening costs 1,640 3,532 1,784 2,048 9,004
Depreciation and amortization 8,231 8,393 9,081 8,923 34,628 Other
expenses - - - 102 102 Loss (gain) on disposal of assets 10
(3) 58 (3) 62 (Loss) income from operations
(4,981) 9,910 10,156 9,452 24,537 Interest expense, net 4,173
4,232 4,209 4,158 16,772 (Loss) income
before taxes (9,154) 5,678 5,947 5,294 7,765 (Benefit) provision
for income taxes (3,366) 2,336 2,023 1,914
2,907 Net (loss) income ($5,788) $3,342 $3,924 $3,380 $4,858
Net (loss) income per common share - basic and diluted
($0.12) $0.07 $0.08 $0.07 $0.10 Weighted-average common
shares - basic 47,983,785 47,986,401 47,986,975 47,986,975
47,986,034 Weighted-average common shares - diluted 47,983,785
47,986,972 47,986,975 47,986,975 47,986,034
The
Container Store Group, Inc. Recast selected consolidated
balance sheet data (unaudited) As of (In
thousands) July 4, 2015 October 3,
2015 January 2, 2016 April 2, 2016
Cash $8,397 $7,397 $20,953 $8,809 Inventory
109,246 112,115 101,899 85,627 Total assets (1) 777,553 785,125
786,255 757,076 Long-term debt, net of deferred financing costs(1)
346,224 345,381 349,491 326,048 Stockholders' equity 198,052
201,359 205,048 211,564
(1) In the first quarter of fiscal 2016,
TCS retrospectively adopted Accounting Standards Update (“ASU”)
2015-03, Interest—Imputation of Interest: Simplifying the
Presentation of Debt Issuance Costs. As such, the total asset and
long-term debt amounts presented above reflect the adjustments to
reclassify deferred financing costs from noncurrent assets to a
reduction of long-term debt in accordance with the new
guidance.
The Container Store Group, Inc.
Recast selected consolidated cash flow data (unaudited)
Thirteen Twenty-six Thirty-nine
Fifty-two Weeks Ended Weeks Ended Weeks
Ended Weeks Ended (In thousands) July
4, 2015 October 3, 2015 January 2,
2016 April 2, 2016 Cash flows (used in) provided
by operating activities ($16,409) ($1,644) $22,065 $42,371 Cash
flows used in investing activities (12,008) (22,789) (31,607)
(41,195) Cash flows provided by financing activities 24,800 20,376
19,303 (3,916) Effect of exchange rate changes on cash 495 (65)
(327) 30 Net (decrease) increase in cash (3,122) (4,122) 9,434
(2,710) Cash at beginning of fiscal period 11,519 11,519 11,519
11,519 Cash at end of fiscal period 8,397 7,397 20,953 8,809
The Container Store Group,
Inc. Recast Reconciliation of GAAP to Non-GAAP Financial
Measures (unaudited) Thirteen Thirteen
Thirteen Thirteen Fifty-two Weeks Ended
Weeks Ended Weeks Ended Weeks Ended Weeks
Ended (In thousands) July 4, 2015
October 3, 2015 January 2, 2016
April 2, 2016 April 2, 2016 Net (loss) income
($5,788) $3,342 $3,924 $3,380 $4,858 Depreciation and amortization
8,231 8,393 9,081 8,923 34,628 Interest expense, net 4,173 4,232
4,209 4,158 16,772 Income tax (benefit) expense (3,366)
2,336 2,023 1,914 2,907 EBITDA 3,250 18,303
19,237 18,375 59,165 Pre-opening costs 1,640 3,532 1,784 2,048
9,004 Noncash rent (670) (311) (508) (295) (1,784) Stock-based
compensation 327 373 488 387 1,575 Foreign exchange losses (gains)
176 (44) 141 (47) 226 Other adjustments 14 16 22
124 176 Adjusted EBITDA 4,737 21,869 21,164 20,592
68,362
The Container Store Group, Inc.
Recast Operating Data (unaudited) As of
July 4, 2015 October 3, 2015
January 2, 2016 April 2, 2016 Store count 72
75 77 79
Thirteen
Thirteen Thirteen Thirteen Fifty-two
Weeks Ended Weeks Ended Weeks Ended Weeks
Ended Weeks Ended July 4, 2015
October 3, 2015 January 2, 2016
April 2, 2016 April 2, 2016
Comparable store sales growthfor the
period(2)
-1.9% 0.5% -0.8% -1.0% -0.8%
(2) A store is included in the comparable
store sales calculation on the first day of the sixteenth full
fiscal month following the store’s opening. Comparable store sales
are net of discounts and returns and exclude shipping and delivery
sales. When a store is relocated, the Company continues to consider
net sales from that store to be comparable store sales. Net sales
from the Company’s website and call center are also included in
calculations of comparable store sales.
In the first quarter of fiscal 2016, the Company changed its
comparable store sales operating measure to be based on the point
at which merchandise and service orders are fulfilled and delivered
to customers, excluding shipping and delivery. Prior to the first
quarter of fiscal 2016, the comparable store sales operating
measure in a given period was based on merchandise and service
orders placed in that period, excluding shipping and delivery,
which did not always reflect when the merchandise and services were
received by the customer and, therefore, recognized in the
Company’s financial statements as net sales. The Company believes
that changing the comparable store sales operating metric to better
align with net sales presented in the Company’s financial
statements will assist investors in evaluating our financial
performance. The comparable store sales percentages presented have
been adjusted to reflect the updated definition.
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version on businesswire.com: http://www.businesswire.com/news/home/20160809006310/en/
Investors:ICR, Inc.Farah Soi/Anne Rakunas,
203-682-8200Anne.Rakunas@icrinc.comorMedia:The Container
StoreCasey Shilling, 972-538-6621casey@containerstore.com
Container Store (NYSE:TCS)
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