Announces $100 Million Share Repurchase
Program
Party City Holdco Inc. (NYSE:PRTY) today announced financial
results for the third quarter ended September 30, 2017, as well as
total revenue, retail and wholesale sales and brand comparable
sales for fiscal October 2017.
For the quarter ended September 30, 2017, the Company
reported total revenues of $560.1 million, up 0.6% from the prior
year period or up 0.3% on a constant currency basis. Income from
operations increased 1.3% to $37.4 million and adjusted EBITDA (see
"Non-GAAP Information") increased slightly to $66.1 million.
Reported GAAP diluted earnings per share were $0.08 in the third
quarters of both 2017 and 2016. Adjusted diluted earnings per share
increased 8.3%, to $0.13 from $0.12 in the third quarter of fiscal
2016 (see "Non-GAAP Information").
James M. Harrison, Chief Executive Officer, stated, “Our
bottom-line performance in the third quarter once again
demonstrated the inherent benefits of our unique vertical model.
Despite modest topline growth, and slightly softer than expected
retail brand comps, in part driven by the hurricane disruptions, we
delivered solid financial performance which was largely in-line
with expectations, as we focused on the core fundamentals of gross
margin expansion and disciplined cost control, resulting in
Adjusted EPS growth of over 8%.”
Mr. Harrison continued, “We are encouraged by the progress made
on our strategic growth initiatives during the quarter, and remain
focused on enhancing the shopping experience both in our stores and
online. We are also encouraged by the comp sales performance across
our permanent stores and the improved trend for the core Everyday
business. However, our web business experienced platform
performance issues that negatively affected traffic levels on our
site and drove the overall brand comp sales decline in the quarter,
and we are aggressively addressing these issues.”
For fiscal October 2017 (for the Company’s retail segment
fiscal October 2017 consisted of the five-week period ended
November 4, 2017), the Company reported total revenue of $475
million, or 5.5% above the same period of last year. Growth in the
month was driven both by the retail segment (revenue of $419
million, a 4.0% increase) and the wholesale segment (sales of $56
million, a 20% increase). Brand comparable sales, which include
Company-owned Party City stores in the U.S. and Canada and North
American e-commerce operations, decreased 1.4%.
During the Halloween season, the Company operated 272 temporary
Halloween City stores, compared to 270 in 2016.
“We are also pleased to announce today that our Board of
Directors approved a $100 million share repurchase program, as our
consistent free cash flow affords us the opportunity to return
value to shareholders, while we also remain focused on reinvesting
in the business, pursuing accretive acquisitions, and paying down
debt. This authorization gives us the flexibility to make
opportunistic share repurchases as we continue to allocate capital
in a balanced and disciplined manner to drive shareholder returns,”
added Mr. Harrison.
Highlights for the third quarter:
- Total revenues of $560.1 million,
including a $5 million hurricane-related headwind, increased 0.6%
on a reported basis or 0.3% on a constant currency basis.
- Wholesale share of shelf1 increased 290
bps to 78.0% during the third quarter, principally due to increased
manufactured share of shelf.
- Reported net income of $10.1 million or
$0.08 on a per share basis, compared to $10.2 million, or $0.08 per
share in the prior year period. Adjusted net income increased 8.4%
to $15.2 million, or $0.13 on a per share basis, from $14.0
million, or $0.12 per share, in the prior year period. Both
reported EPS and adjusted EPS reflect an approximate $0.02 per
share hurricane and foreign exchange-related headwind, offset
partially by $0.01 per share of tax rate favorability.
- Adjusted EBITDA increased slightly to
$66.1 million, despite $2.5 million of hurricane related
headwind.
- Free cash flow2 increase of nearly 11%,
to $49.1 million.
“Based on our year-to-date performance, we are updating our full
year guidance. Looking ahead, we remain focused on executing our
retail initiatives as well as elevating our e-commerce capabilities
which, combined with the power of our vertical model, will drive
sustainable top and bottom line improvement.” Mr. Harrison
concluded.
Third quarter summary:
- Reported net income of $10.1 million
compared to $10.2 million in the third quarter of 2016.
- Adjusted net income increased 8.4% to
$15.2 million, compared to $14.0 million for the prior year
quarter.
- Adjusted EBITDA increased slightly to
$66.1 million, despite approximately $2.5 million of hurricane
headwind, compared to $66.0 million in the third quarter of
2016.
- Reported diluted earnings per share
totaled $0.08, flat with the prior year quarter. Adjusted diluted
income per share increased 8.3% to $0.13 from $0.12 in the third
quarter of 2016, despite $0.02 per share hurricane and foreign
exchange-related headwind, offset partially by $0.01 per share of
tax rate favorability.
- Total revenues of $560.1 million,
including a $5 million hurricane-related headwind, increased 0.6%
on a reported basis or 0.3% on a constant currency basis.
- Retail sales increased 4.7% on a
reported basis (4.5% on a constant currency basis) driven primarily
by increased store count through acquired franchise stores (36),
one acquired independent store and new store growth (20 net new
Party City stores) in the past twelve months.
- Brand comparable sales, adjusted for
the approximate 140 basis points negative impact of the hurricanes,
decreased 1.2% during the third quarter.
- Net third-party wholesale revenues
decreased 6.1% on a reported basis (decreased 1.6% on an adjusted
basis when adjusting for currency effect, as well as the impact of
eliminating $9.8 million in intercompany sales for the 36 franchise
store acquisitions over the last twelve months).
- Total gross profit margin increased 40
basis points to 35.9% of net sales, primarily due to higher share
of shelf and reduced product costs.
- Operating expenses totaled 29.5% of
revenues (an increase of 20 basis points from Q3 2016), and
increased 1.1% over the third quarter of 2016 to $165.2
million.
- The effective tax rate was 25.7%,
compared to 33.9% in the third quarter of 2016. The decrease in the
effective tax rate was principally due to discrete items related to
uncertain tax positions, stock option exercises and
return-to-provision adjustments, partially offset by the impact of
state tax rate changes on deferred tax liabilities.
- During the quarter, the Company opened
six new stores and closed one store.
Balance sheet highlights as of September 30, 2017:
The Company ended the quarter with $1,730 million in debt (net
of cash) resulting in net debt leverage3 of 4.3 times and
approximately $372 million in availability under its asset-based
revolving credit facility.
Share Repurchase Program:
The Company also announced today that its Board of Directors has
approved a share repurchase program under which the Company may
purchase up to $100 million of its outstanding common shares from
time to time, depending upon a variety of factors, including market
and industry conditions, share price, regulatory requirements and
other corporate considerations, as determined by the Company from
time to time. The authorization expires on November 12, 2018,
subject to extension or earlier termination by the Board of
Directors. The Company may purchase shares of its common stock in
open-market and/or privately negotiated transactions in accordance
with applicable securities laws and regulations, including Rule
10b-18 of the Securities Exchange Act of 1934, and repurchases may
be executed pursuant to Rule 10b5-1 under the Securities Exchange
Act of 1934. The authorization may be suspended or discontinued at
any time without notice.
Fiscal 2017 Outlook:
For full-year 2017, the Company is adjusting its guidance as
follows:
- Total revenue of $2.36 to $2.39
billion
- Brand comparable sales flat to down
1%
- Adjusted EBITDA of $400 to $410
million
- Adjusted net income of $146 to $151
million
- Adjusted diluted EPS of $1.21 to
$1.25*
- Net debt leverage of approximately 3.5x
by the end of 2017
- GAAP net income of $121 to $126
million
- GAAP diluted EPS of $1.00 to
$1.04*
* The above outlook excludes any impact from potential share
repurchases made by the Company.
The Company has reconciled Non-GAAP outlook measures to the most
directly comparable GAAP measures later in this release. See
"Non-GAAP Information" and “Reconciliation of 2017 Outlook” for a
more detailed explanation, including definitions of the various
Non-GAAP terms used in this release.
_____________________
1 The percentage of our retail product cost of sales supplied by
our wholesale operations
2 Defined as adjusted EBITDA less capital expenditures
3 Defined as net debt to adjusted EBITDA
Conference Call Information
A conference call to discuss the third quarter 2017 financial
results and fiscal October 2017 sales is scheduled for today,
November 9, 2017, at 8:00 a.m. Eastern Time. Investors and analysts
interested in participating in the call are invited to dial (833)
241-4256 (U.S. domestic) and (647) 689-4207 (international), and
enter conference ID#99511792, approximately 10 minutes prior to the
start of the call. The conference call will also be webcast at
http://investor.partycity.com/. To listen to the live call, please
go to the website at least 15 minutes early to register and
download any necessary audio software. The webcast will be
accessible for one year after the call.
Website Information
We routinely post important information for investors on the
Investor Relations section of our website,
http://investor.partycity.com/. We intend to use this website as a
means of disclosing material, non-public information and for
complying with our disclosure obligations under Regulation FD.
Accordingly, investors should monitor the Investor Relations
section of our website, in addition to following our press
releases, SEC filings, public conference calls, presentations and
webcasts. The information contained on, or that may be accessed
through, our website is not incorporated by reference into, and is
not a part of, this document.
Non-GAAP Information
This press release includes non-GAAP measures including Adjusted
EBITDA and Adjusted Net Income/Loss and Adjusted Earnings per
Share. We present these non-GAAP financial measures because we
believe they assist investors in comparing our performance across
reporting periods on a consistent basis by eliminating items that
we do not believe are indicative of our core operating performance.
In addition, we use Adjusted EBITDA: (i) as a factor in determining
incentive compensation, (ii) to evaluate the effectiveness of our
business strategies and (iii) because our credit facilities use
Adjusted EBITDA to measure compliance with certain covenants. The
Company has reconciled these non-GAAP financial measures with the
most directly comparable GAAP financial measures in tables
accompanying this release. We also evaluate our results of
operations on both an as reported and a constant currency basis.
The constant currency presentation, which is a non-GAAP measure,
excludes the impact of fluctuations in foreign currency exchange
rates. We calculate constant currency percentages by converting our
prior-period local currency financial results using the current
period exchange rates and comparing these adjusted amounts to our
current period reported results. We also provide free cash flow,
defined as Adjusted EBITDA less capital expenditures, and net debt
leverage, which is calculated by adding Loans and Notes Payable,
Current Portion of Long Term Obligations and Long Term Obligations,
Excluding Current Portion, subtracting Cash and Cash Equivalents
and dividing by Adjusted EBITDA for the trailing twelve month
period. Adjusted Earnings per Share is calculated by dividing
Adjusted Net Income by the Weighted Average Number of Common
Shares-Diluted. We believe providing these non-GAAP measures
provides valuable supplemental information regarding our results of
operations and leverage, consistent with how we evaluate our
performance. In evaluating these non-GAAP financial measures,
investors should be aware that in the future the Company may incur
expenses or be involved in transactions that are the same as or
similar to some of the adjustments in this presentation. The
Company's presentation of non-GAAP financial measures should not be
construed to imply that its future results will be unaffected by
any such adjustments. The Company has provided this information as
a means to evaluate the results of its core operations. Other
companies in the Company's industry may calculate these items
differently than it does. Each of these measures is not a measure
of performance under GAAP and should not be considered as a
substitute for the most directly comparable financial measures
prepared in accordance with GAAP. Non-GAAP financial measures have
limitations as analytical tools, and investors should not consider
them in isolation or as a substitute for analysis of the Company's
results as reported under GAAP.
Forward-Looking Statements
This press release contains forward-looking statements made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements give
current expectations or forecasts of future events or our future
financial or operating performance, and include Party City’s
expectations regarding revenues, brand comparable sales, Adjusted
EBITDA, Adjusted net income/loss, adjusted diluted earnings per
share, average common shares outstanding and the effective tax
rate. The forward-looking statements contained in this press
release are based on management's good-faith belief and reasonable
judgment based on current information, and these statements are
qualified by important risks and uncertainties, many of which are
beyond our control, that could cause our actual results to differ
materially from those forecasted or indicated by such
forward-looking statements. These risks and uncertainties include:
our ability to compete effectively in a competitive industry;
fluctuations in commodity prices; our ability to appropriately
respond to changing merchandise trends and consumer preferences;
successful implementation of our store growth strategy; decreases
in our Halloween sales; disruption to the transportation system or
increases in transportation costs; product recalls or product
liability; economic slowdown affecting consumer spending and
general economic conditions; loss or actions of third party vendors
and loss of the right to use licensed material; disruptions at our
manufacturing facilities; and the additional risks and
uncertainties set forth in “Risk Factors” in Party City’s latest
Form 10-K and in subsequent reports filed with or furnished to the
Securities and Exchange Commission. Although we believe that the
expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future events, outlook, guidance,
results, actions, levels of activity, performance or achievements.
Readers are cautioned not to place undue reliance on these forward
looking statements. Except as may be required by any applicable
laws, Party City assumes no obligation to publicly update or revise
such forward-looking statements, which are made as of the date
hereof or the earlier date specified herein, whether as a result of
new information, future developments or otherwise.
About Party City
Party City Holdco Inc. is the leading party goods company by
revenue in North America and, we believe, the largest vertically
integrated supplier of decorated party goods globally by revenue.
The Company is a popular one-stop shopping destination for party
supplies, balloons, and costumes. In addition to being a great
retail brand, the Company is a global, world-class organization
that combines state-of-the-art manufacturing and sourcing
operations, and sophisticated wholesale operations complemented by
a multi-channel retailing strategy and e-commerce retail
operations. The Company is the leading player in its category,
vertically integrated and unique in its breadth and depth. Party
City Holdco designs, manufactures, sources and distributes party
goods, including paper and plastic tableware, metallic and latex
balloons, Halloween and other costumes, accessories, novelties,
gifts and stationery throughout the world. The Company’s retail
operations include over 900 specialty retail party supply stores
(including approximately 150 franchise stores) throughout North
America operating under the names Party City and Halloween City,
and e-commerce websites, principally through the domain name
PartyCity.com.
PARTY CITY HOLDCO INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share
data)
September 30, December 31,
2017 2016 ASSETS Unaudited
Current assets: Cash and cash equivalents $ 58,143 $ 64,610
Accounts receivable, net 169,059 134,091 Inventories, net 687,254
613,868 Prepaid expenses and other current assets 84,859
68,255 Total current assets 999,315 880,824
Property, plant and equipment, net 298,758 292,904 Goodwill
1,631,806 1,572,568 Trade names 567,507 566,599 Other intangible
assets, net 65,023 76,581 Other assets, net 12,703
4,502 Total assets $ 3,575,112 $ 3,393,978
LIABILITIES, REDEEMABLE SECURITIES AND
STOCKHOLDERS’ EQUITY Current liabilities: Loans and notes
payable $ 241,339 $ 120,138 Accounts payable 169,130 163,415
Accrued expenses 184,115 149,683 Income taxes payable - 46,675
Current portion of long-term obligations 13,064
13,348 Total current liabilities 607,648 493,259
Long-term obligations, excluding current portion 1,534,146
1,539,604 Deferred income tax liabilities 282,376 278,819 Deferred
rent and other long-term liabilities 80,389
65,507 Total liabilities 2,504,559 2,377,189
Redeemable securities 3,000 - Stockholders’ equity: Common stock
(119,662,869 and 119,515,894 shares issued and outstanding at
September 30, 2017 and December 31, 2016, respectively) 1,197 1,195
Additional paid-in capital 915,090 910,167 Retained earnings
188,049 157,666 Accumulated other comprehensive loss (36,783
) (52,239 ) Total stockholders’ equity 1,067,553
1,016,789 Total liabilities, redeemable
securities and stockholders’ equity $ 3,575,112 $ 3,393,978
PARTY CITY HOLDCO INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME
(In thousands, except share and per
share data, unaudited)
Three Months Ended September 30,
Nine Months Ended September 30, 2017
2016 2017
2016 Revenues: Net sales $ 557,350 $ 553,382 $
1,572,966 $ 1,523,094 Royalties and franchise fees 2,759
3,568 9,020 11,009 Total
revenues 560,109 556,950 1,581,986 1,534,103 Expenses: Cost
of sales 357,523 356,662 978,142 952,294 Wholesale selling expenses
16,274 14,739 47,946 45,854 Retail operating expenses 100,739
100,746 281,981 278,070 Franchise expenses 3,636 3,370 10,666
10,507 General and administrative expenses 37,971 38,972 125,763
115,828 Art and development costs 5,898 5,543 17,638 16,596
Development stage expenses 680 - 7,092
- Total expenses 522,721 520,032
1,469,228 1,419,149 Income from operations
37,388 36,918 112,758 114,954 Interest expense, net 23,228
22,424 65,214 67,857 Other expense (income), net 593
(905 ) 860 (4,107 ) Income before income taxes 13,567
15,399 46,684 51,204 Income tax expense 3,483 5,219
16,301 18,903 Net income $ 10,084 $
10,180 $ 30,383 $ 32,301 Comprehensive
income $ 15,329 $ 6,028 $ 45,839 $ 22,355 Net
income per common share-Basic $ 0.08 $ 0.09 $ 0.25 $ 0.27
Net income per common share-Diluted $ 0.08 $ 0.08 $
0.25 $ 0.27 Weighted-average number of common shares-Basic
119,587,339 119,406,751 119,546,451 119,340,610 Weighted-average
number of common shares-Diluted 120,912,849 120,472,297 120,907,979
120,312,492
PARTY CITY HOLDCO INC.
RECONCILIATION OF ADJUSTED
EBITDA
(In thousands)
Three Months Ended September 30, Nine
Months Ended September 30, 2017
2016 2017 2016
Net income $ 10,084 $ 10,180 $ 30,383 $ 32,301
Interest expense, net 23,228 22,424 65,214 67,857 Income taxes
3,483 5,219 16,301 18,903 Depreciation and amortization
20,694 20,015 62,519
61,186
EBITDA 57,489 57,838 174,417 180,247 Non-cash
purchase accounting adjustments 1,500 - 6,350 3,689 Restructuring,
retention and severance (a) 212 92 8,839 254 Deferred rent (b)
2,719 7,095 5,634 12,240 Closed store expense (c) 1,285 971 4,164
2,927 Foreign currency losses (gains), net 36 (1,767 ) (1,684 )
(6,945 ) Employee equity based compensation (d) 630 948 3,852 2,829
Non-employee equity based compensation (e) 21 - 3,286 -
Undistributed loss (income) in unconsolidated joint ventures 134
113 (92 ) 380 Corporate development expenses (f) 1,634 683 6,078
1,895 Hurricane-related costs 385 - 385 - Other 84
61 562 118
Adjusted EBITDA $ 66,129 $ 66,034 $
211,791 $ 197,634
Adjusted EBITDA
margin 11.8 % 11.9 % 13.4 % 12.9 %
(a) During the first quarter of 2017, the Company
entered into a consulting agreement with Gerald Rittenberg and
recorded a severance charge in accordance with the terms of such
agreement (this amount excludes a $1,362 stock option modification
charge for Mr. Rittenberg, which is included in “Employee equity
based compensation” in this table). Additionally, during the first
quarter of 2017, the Company restructured its retail operations and
recorded a severance charge. Further, the “restructuring, retention
and severance” amounts in the adjusted EBITDA table also include
additional restructuring, retention and severance charges incurred
by the Company and excluded from the definition of adjusted EBITDA
in the Company’s credit facilities (see "Non-GAAP Information"
above for a discussion of the Company’s use of adjusted EBITDA).
(b) The deferred rent adjustment reflects the difference
between accounting for rent and landlord incentives in accordance
with GAAP and the Company’s actual cash outlay for such items.
(c) Charges incurred related to closing underperforming
stores. (d) The first quarter of 2017 includes a $1,362
stock option modification charge for Gerald Rittenberg. (e)
Principally represents shares of Kazzam awarded to Ampology as
compensation for Ampology’s services. (f) Primarily
represents start-up costs for Kazzam and third-party costs related
to acquisitions (principally legal expenses).
PARTY CITY HOLDCO INC.
RECONCILIATION OF ADJUSTED NET
INCOME
(In thousands, except share and per
share data)
Three Months Ended September 30, Nine
Months Ended September 30, 2017 2016
2017 2016 Income before income
taxes $13,567 $15,399 $46,684 $51,204 Intangible asset
amortization 3,879 4,049 11,704 12,182 Non-cash purchase accounting
adjustments (a) 2,241 (102) 8,165 4,991 Amortization of deferred
financing costs and original issuance discounts 1,240 1,277 3,699
3,821 Restructuring, retention and severance (b) (323) - 7,491 -
Non-employee equity based compensation (c) 21 - 3,286 -
Hurricane-related costs 385 - 385 - Employee equity based
compensation (d) 630 948 3,852 2,829
Adjusted income before
income taxes 21,640 21,571 85,266 75,027 Adjusted income tax
expense (e) 6,467 7,568 30,713 27,918
Adjusted net income
$15,173 $14,003 $54,553 $47,109
Adjusted net income per
common share - diluted $0.13 $0.12 $0.45 $0.39
Weighted-average number of common shares-diluted 120,912,849
120,472,297 120,907,979 120,312,492 (a) On July 27, 2012, PC
Merger Sub, Inc., which was our wholly-owned indirect subsidiary,
merged into Party City Holdings Inc. (“PCHI”), with PCHI being the
surviving entity (the “Transaction”). As a result of the
Transaction, the Company applied the acquisition method of
accounting and increased the value of certain property, plant and
equipment. The impact of such adjustments on depreciation expense
increased the Company’s expenses. These property, plant and
equipment depreciation amounts are included in “Non-cash purchase
accounting adjustments” for purposes of calculating “adjusted net
income,” but are excluded from “Non-cash purchase accounting
adjustments” for purposes of calculating adjusted EBITDA since they
are included in depreciation expense. (b) During the first
quarter of 2017, the Company entered into a consulting agreement
with Gerald Rittenberg and recorded a severance charge in
accordance with the terms of such agreement (this amount excludes a
$1,362 stock option modification charge for Mr. Rittenberg, which
is included in “Employee equity based compensation” in this table).
Additionally, during the first quarter of 2017, the Company
restructured its retail operations and recorded a severance charge.
(c) Principally represents shares of Kazzam awarded to
Ampology as compensation for Ampology’s services. (d) The
first quarter of 2017 includes a $1,362 stock option modification
charge for Gerald Rittenberg. (e) Represents income tax
expense/benefit after excluding the specific tax impacts for each
of the pre-tax adjustments. The tax impacts for each of the
adjustments were determined by applying to the pre-tax adjustments
the effective income tax rates for the specific legal entities in
which the adjustments were recorded.
PARTY CITY HOLDCO INC.
RECONCILIATION OF 2017 OUTLOOK
(In millions, unaudited)
Full year 2017 Outlook
Net income: $ 121 - $ 126 Intangible asset amortization, net
of tax:
9
Restructuring, retention and severance, net of tax: 5 Non-cash
purchase accounting adjustments, net of tax:
5
Equity based compensation, net of tax: 4 Amortization of deferred
financing costs and original issuance discount, net of tax:
2
Adjusted net income: $ 146 - $
151
Net income: $ 121 - $ 126
Income taxes: 72 - 76 Interest expense, net: 87 Depreciation and
amortization: 84
EBITDA: $ 364 -
$ 373 Corporate development expenses: 9 Restructuring, retention
and severance: 9 Equity based compensation:
8
Deferred rent: 6 - 7 Non-cash purchase accounting adjustments:
6
Foreign exchange gains:
(2
)
Adjusted EBITDA: $ 400 - $ 410
PARTY CITY HOLDCO INC.
SEGMENT INFORMATION
(In thousands, except
percentages)
Three Months Ended September 30, 2017
2016 Total Revenues
Dollars inthousands
Percentage ofTotal
Revenues
Dollars inthousands
Percentage ofTotal
Revenues
Net Sales: Wholesale $ 381,858 68.2 % $ 416,387 74.8 % Eliminations
(188,565 ) (33.7 %) (210,562 ) (37.8 %) Net wholesale
193,293 34.5 % 205,825 37.0 % Retail 364,057 65.0 %
347,557 62.4 % Total net sales 557,350 99.5 % 553,382
99.4 % Royalties and franchise fees 2,759 0.5 %
3,568 0.6 % Total revenues $ 560,109 100.0 % $
556,950 100.0 %
Nine Months Ended September
30, 2017 2016 Total Revenues
Dollars inthousands
Percentage ofTotal
Revenues
Dollars inthousands
Percentage ofTotal
Revenues
Net Sales: Wholesale $ 929,255 58.7 % $ 945,071 61.6 % Eliminations
(459,416 ) (29.0 %) (465,189 ) (30.3 %) Net wholesale
469,839 29.7 % 479,882 31.3 % Retail 1,103,127 69.7 %
1,043,212 68.0 % Total net sales 1,572,966 99.4 %
1,523,094 99.3 % Royalties and franchise fees 9,020
0.6 % 11,009 0.7 % Total revenues $ 1,581,986
100.0 % $ 1,534,103 100.0 %
Three
Months Ended September 30, 2017 2016 Total
Gross Profit
Dollars inthousands
Percentage ofNet Sales
Dollars inthousands
Percentage ofNet Sales
Retail $ 141,334 38.8 % $ 133,177 38.3 % Wholesale 58,493
30.3 % 63,543 30.9 % Total $ 199,827
35.9 % $ 196,720 35.5 %
Nine Months Ended
September 30, 2017 2016 Total Gross Profit
Dollars inthousands
Percentage ofNet Sales
Dollars inthousands
Percentage ofNet Sales
Retail $ 447,787 40.6 % $ 419,283 40.2 % Wholesale 147,037
31.3 % 151,517 31.6 % Total $ 594,824
37.8 % $ 570,800 37.5 %
PARTY CITY HOLDCO INC.
OPERATING METRICS
Three Months Ended September 30, LTM
2017 2016 2017 Store
Count Corporate Stores: Beginning of period 789 730 737 New
stores opened 6 8 28 Acquired - - 37 Closed (1 ) (1 ) (8 ) End of
period 794 737 794 Franchise Stores: Beginning of period 147 183
184 New stores opened 1 1 3 Sold to Party City - - (36 ) Closed -
- (3 ) End of period 148 184 148
Grand Total 942 921 942
Three
Months Ended September 30, Nine Months Ended September
30, 2017 2016 2017 2016
Share of Shelf (a) 78.0 % 75.1 % 78.0 % 75.9 %
Three Months Ended September 30,
Nine Months Ended September 30, 2017 2016
2017 2016 Brand comparable sales
(b) -2.6 % 1.2 % -0.3 % 1.3 % (a) Share of shelf
represents the percentage of our retail product cost of sales
supplied by our wholesale operations. (b) Party City brand
comparable sales include North American e-commerce sales.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20171109005120/en/
ICRFarah Soi and Rachel
Schacter203-682-8200InvestorRelations@partycity.com
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