Tuesday Morning Corporation (NASDAQ:TUES), one of
the original off-price retailers currently with over 720 stores
across the United States specializing in name-brand, high quality
products for the home, selling luxury textiles, furnishings,
housewares and seasonal decor, today announced financial results
for the third quarter and nine months ended March 31, 2018.
Steve Becker, Chief Executive Officer, stated,
“Our third quarter results demonstrate the progress we are making
against our strategic initiatives. As expected, the third
quarter marked an inflection in our gross margin performance as we
delivered almost a 300 basis point year-over-year improvement.
Our focus on turning
inventory faster, improving the overall
inventory allocation across our store base, offering great values
and a consistent flow of deals is delivering a better customer
experience, all of which have contributed
to improved comparable store sales. Looking ahead, we
are well positioned to continue executing against our strategies to
set the foundation for long-term profitable growth
at Tuesday Morning.”
Third Quarter Fiscal 2018 Results of
Operations
- Net sales were $223.3 million, compared to $203.0 million for
the third quarter of fiscal 2017 on a flat store base.
- Comparable store sales increased 9.1% compared to the same
period a year ago, and were comprised of a 5.9% increase in
customer transactions along with a 3.0% increase in average
ticket. During the third quarter, 10 stores were relocated,
five stores were opened, and five stores were closed, for an ending
store count of 724 as of March 31, 2018. Sales at the 58
stores relocated during the past 12 months increased approximately
65% on average for the third quarter of fiscal 2018 as compared to
the prior year quarter and contributed approximately 430 basis
points of comparable store sales growth, driven primarily by better
real estate and larger average store footprint. The Company’s
third quarter benefitted from the shifts of a promotional event
from the fourth quarter to the third quarter as well as from the
timing of the sales ramp up prior to the Easter holiday.
Although an estimation, the Company believes that these shifts
benefitted third quarter fiscal 2018 comparable store sales
performance by approximately 300 basis points.
- Gross profit increased $13.1 million to $80.3 million compared
to $67.2 million of gross profit in the third quarter of fiscal
2017. Gross margin for the third quarter of fiscal 2018 was
36.0% compared to 33.1% last year. The increase in gross
margin for the quarter was driven by a significant decrease in the
amount of distribution and freight costs as a percentage of sales
recognized in the third quarter fiscal 2018 compared to the prior
year. Those prior year elevated costs were incurred due to
the supply chain issues the Company experienced in fiscal
2017. Additionally, the Company has achieved and recognized
cost efficiencies in its distribution operations in the current
year, along with reduced markdowns and continued improvement in
initial merchandise mark-up which have contributed to improvements
in gross margin.
- Selling, general and administrative expenses (SG&A)
increased $6.3 million to $88.1 million in the third quarter of
fiscal 2018, compared to $81.8 million in the same period last
year. As a percentage of net sales, SG&A was 39.5% for
the third quarter of fiscal 2018 compared to 40.3% in the same
period last year, leveraging approximately 80 basis points.
This decrease in SG&A as a percentage of net sales was driven
primarily by leveraging store labor costs, as well as reductions in
certain corporate expenses, including labor and legal costs, which
decreased both in dollars and as a percentage of net sales in the
current year quarter from the prior year quarter. Partially
offsetting these decreased costs were higher store rent and
depreciation, due in part to the Company’s strategy to improve
store real estate, and higher advertising expenses due to
promotional timing.
- The Company’s operating loss for the third quarter of fiscal
2018 was $7.8 million, compared to an operating loss of $14.7
million in the third quarter of fiscal 2017.
- The Company reported a net loss of $8.1 million, or $0.18 per
share, for the third quarter of fiscal 2018 compared to a net loss
of $14.8 million, or $0.34 per share, for the third quarter of
fiscal 2017.
- EBITDA, a non-GAAP measure, was negative $1.3 million for the
third quarter of fiscal 2018, compared to EBITDA of negative $8.7
million for the prior year period. Adjusted EBITDA, a
non-GAAP measure, was negative $0.9 million for the third quarter
of fiscal 2018, compared to Adjusted EBITDA of negative $7.8
million for the prior year period, primarily driven by the change
in net loss as compared to the prior year period as adjusted for
incremental costs relating to the ramp-up of the Company’s Phoenix
distribution center in the prior year period. A
reconciliation of GAAP and non-GAAP measures is provided
below.
Nine Months ended March 31, 2018 Results of
Operations
- Net sales were $775.9 million, compared to $743.0 million for
the first nine months of fiscal 2017 on a flat store
base.
- Comparable store sales increased 4.3% compared to the same
period a year ago, and were comprised of a 3.3% increase in
customer transactions, along with a 1.0% increase in average
ticket. During the first nine months of fiscal 2018, 36
stores were relocated, 13 stores were opened, seven stores were
expanded, and 20 stores were closed, for an ending store count of
724 as of March 31, 2018. Sales at the 58 stores relocated
during the past 12 months increased approximately 61% on average
for the first nine months of fiscal 2018 as compared to the same
period in the prior year and contributed approximately 390 basis
points of comparable store sales growth, driven primarily by better
real estate and larger average store footprint.
- Gross profit increased $13.4 million to $263.9 million compared
to $250.5 million of gross profit in the first nine months of
fiscal 2017. Gross margin for the first nine months of fiscal
2018 was 34.0% compared to 33.7% last year. The increase in
gross margin was primarily due to improvements in initial
merchandise mark-up and reduced markdowns, partially offset by
higher distribution and freight costs recognized in the current
year, due to the elevated costs incurred in the prior year as a
result of the supply chain issues the Company experienced in fiscal
2017.
- SG&A increased $9.8 million to $275.4 million in the first
nine months of fiscal 2018, compared to $265.6 million in the same
period last year. As a percentage of net sales, SG&A was
35.5% for the first nine months of fiscal 2018 compared to 35.7% in
the same period last year. This decrease in SG&A as a
percentage of net sales was driven primarily by reductions in
certain corporate expenses, including labor costs, and legal and
professional fees, which decreased both in dollars and as a
percentage of net sales in the current year from the prior year
period. Partially offsetting these decreased costs were
higher store rent and depreciation, due in part to the Company’s
strategy to improve store real estate.
- The Company’s operating loss for the first nine months of
fiscal 2018 was $11.5 million, compared to an operating loss of
$15.2 million for the prior year period.
- The Company reported a net loss of $11.6 million, or $0.26 per
share, for the first nine months of fiscal 2018 compared to a net
loss of $15.2 million, or $0.35 per share, for the prior year
period. The Company’s net loss in the current period reflects
a favorable tax impact of approximately $0.6 million resulting from
recent tax law changes.
- EBITDA, a non-GAAP measure, was $8.5 million for the first nine
months of fiscal 2018, compared to EBITDA of $1.6 million for the
prior year period. Adjusted EBITDA, a non-GAAP measure, was
$11.6 million for the first nine months of fiscal 2018, compared to
Adjusted EBITDA of $7.0 million for the prior year period,
primarily driven by the change in net loss as compared to the prior
year period as adjusted for incremental costs relating to the
ramp-up of the Company’s Phoenix distribution center in the prior
year period. A reconciliation of GAAP and non-GAAP measures
is provided below.
The Company ended the third quarter of fiscal
2018 with $12.3 million in cash and cash equivalents. The
Company had $44.4 million outstanding under its line of credit with
availability on the line of $67.0 million. Inventories at the
end of the third quarter of fiscal 2018 were $245.0 million
compared to $268.3 million at the end of the third quarter of
fiscal 2017, a decrease of $23.3 million or 8.7%. The
decrease in inventory was driven primarily by lower distribution
center and in-transit inventory levels, due in part to the
Company’s continued supply chain and inventory management
improvements. The Company’s inventory turnover for the
trailing five quarters as of March 31, 2018 was 2.7 turns, an
improvement of approximately 13% from the trailing five quarter
turnover as of March 31, 2017 of 2.4 turns.
Fiscal Year 2018 OutlookThe Company expects
comparable store sales for fiscal 2018 to increase 3% to 4%.
Gross margin is expected to show year over year improvement
in the fourth quarter, though to a lesser extent than that realized
in the third quarter. The Company continues to expect
significant projected EBITDA improvement in the fourth quarter and
in fiscal 2018. Net capital expenditures are expected to be
in the range of approximately $23 million to $26 million in fiscal
2018, with a continuing focus on real estate strategy for new
stores, relocations and expansions of existing stores, and IT
infrastructure and enhancements.
About Tuesday MorningTuesday Morning Corporation
(NASDAQ:TUES) is one of the original off-price retailers
specializing in name-brand, high quality products for the home,
selling luxury textiles, furnishings, housewares and seasonal
decor. Based in Dallas, Texas, the Company opened its first
store in 1974 and operates over 720 stores in 40 states. More
information and a list of store locations may be found on the
Company’s website at www.tuesdaymorning.com.
Conference Call InformationTuesday Morning
Corporation’s management will hold a conference call to review
third quarter fiscal 2018 financial results and provide a general
business update today, May 3, 2018, at 8:00 a.m. Central
Time. A live webcast of the conference call will be available
in the Investor Relations section of the Company’s website at
www.tuesdaymorning.com, or you may dial into the conference call at
(877) 312-5376 (no access code required) approximately ten minutes
prior to the start of the call. A replay of the webcast will
be accessible through the Company’s website for 90 days. A
replay of the conference call will be available from 11:00 a.m.,
Central Time, May 3, 2018 through 10:59 a.m., Central Time, Sunday,
May 6, 2018 by dialing (855) 859-2056 or (404) 537-3406 and
entering conference ID number 7990088.
Non-GAAP Financial MeasuresThis press release
includes financial measures that are presented both in accordance
with U.S. generally accepted accounting principles (“GAAP”) and
using certain non-GAAP financial measures, EBITDA and Adjusted
EBITDA. For more information regarding the Company’s use of
non-GAAP financial measures, including the definition of EBITDA and
Adjusted EBITDA, and a reconciliation to net income/(loss), the
most directly comparable GAAP measure, see “Non-GAAP Financial
Measures” within this press release.
Cautionary Statement Regarding Forward-Looking
StatementsThis press release contains forward-looking statements,
which are based on management’s current expectations, estimates and
projections. Forward-looking statements typically are
identified by the use of terms such as “may,” “will,” “should,”
“expect,” “anticipate,” “believe,” “estimate,” “intend” and similar
words, although some forward-looking statements are expressed
differently. You should consider statements that contain
these words carefully because they describe management’s current
expectations, plans, strategies and goals and management’s current
beliefs concerning future business conditions, future results of
operations, future financial position, and their current business
outlook or state other “forward-looking” information.
Forward-looking statements in this press release also
include, but are not limited to, statements of management’s current
plans and expectations in this press release and statements in the
“Outlook” section of this press release. Forward-looking
statements also include statements regarding management’s sales and
growth expectations, EBITDA and Adjusted EBITDA projections,
liquidity, capital expenditure plans, inventory management plans,
productivity of the Company's store base, real estate strategy and
their merchandising and marketing strategies.
Reference is hereby made to the Company’s
filings with the Securities and Exchange Commission, including, but
not limited to, "Cautionary Statement Regarding Forward-Looking
Statements" and "Item 1A. Risk Factors" of the Company's Annual
Report on Form 10-K for the fiscal year ended June 30, 2017, for
examples of risks, uncertainties and events that could cause our
actual results to differ materially from the expectations expressed
in our forward-looking statements. These risks, uncertainties and
events also include, but are not limited to, the following: our
ability to successfully implement our long-term business strategy;
changes in economic and political conditions which may adversely
affect consumer spending; our failure to identify and respond to
changes in consumer trends and preferences; our ability to
continuously attract buying opportunities for off-price merchandise
and anticipate consumer demand; our ability to successfully manage
our inventory balances profitably; our ability to effectively
manage our supply chain operations; loss of, disruption in
operations, or increased costs in the operation of our distribution
center facilities; unplanned loss or departure of one or more
members of our senior management or other key management; increased
or new competition; our ability to successfully execute our
strategy of opening new stores and relocating and expanding
existing stores; increases in fuel prices and changes in
transportation industry regulations or conditions; our ability to
generate strong cash flows from operations and to continue to
access credit markets; increases in the cost or a disruption in the
flow of our imported products; changes in federal tax policy; the
success of our marketing, advertising and promotional efforts; our
ability to attract, train and retain quality employees in
appropriate numbers, including key employees and management;
increased variability due to seasonal and quarterly fluctuations;
our ability to maintain and protect our information technology
systems and technologies and related improvements to support our
growth; our ability to protect the security of information about
our business and our customers, suppliers, business partners and
employees; our ability to comply with existing, changing, and new
government regulations; our ability to manage litigation risks from
our customers, employees and other third parties; our ability to
manage risks associated with product liability claims and product
recalls; the impact of adverse local conditions, natural disasters
and other events; our ability to manage the negative effects of
inventory shrinkage; our ability to manage exposure to unexpected
costs related to our insurance programs; our ability to mitigate
reductions of customer traffic in shopping centers where our stores
are located; and increased costs or exposure to fraud or theft
resulting from payment card industry related risk and
regulations. The Company’s filings with the SEC are available
at the SEC’s web site at www.sec.gov.
The forward-looking statements made in this
press release relate only to events as of the date on which the
statements were made. Except as may be required by law, the Company
disclaims obligations to update any forward-looking statements to
reflect events and circumstances after the date on which the
statements were made or to reflect the occurrence of unanticipated
events. Investors are cautioned not to place undue reliance
on any forward-looking statements.
TUESDAY MORNING
CORPORATIONNON-GAAP FINANCIAL
MEASURES(Unaudited)
The Company defines EBITDA as net income or net loss before
interest, income taxes, depreciation, and amortization.
Adjusted EBITDA reflects further adjustments to EBITDA to eliminate
the impact of certain items, including certain non-cash items and
other items that the Company believes are not representative of its
core operating performance. These measures are not
presentations made in accordance with GAAP. EBITDA and
Adjusted EBITDA should not be considered as alternatives to net
income or loss as a measure of operating performance. In
addition, EBITDA and Adjusted EBITDA are not presented as, and
should not be considered as, alternatives to cash flows as a
measure of liquidity. EBITDA and Adjusted EBITDA should not
be considered in isolation, or as substitutes for analysis of the
Company’s results as reported under GAAP and Adjusted EBITDA should
not be construed as an inference that the Company’s future results
will be unaffected by such adjustments. The Company believes
it is useful for investors to see these EBITDA and Adjusted EBITDA
measures that management uses to evaluate the Company’s operating
performance. These non-GAAP financial measures are included
to supplement the Company’s financial information presented in
accordance with GAAP and because the Company uses these measures to
monitor and evaluate the performance of its business as a
supplement to GAAP measures and believes the presentation of these
non-GAAP measures enhances investors’ ability to analyze trends in
the Company’s business and evaluate the Company’s
performance. EBITDA and Adjusted EBITDA are also frequently
used by analysts, investors and other interested parties to
evaluate companies in the Company’s industry. The non-GAAP
measures presented in this press release may not be comparable to
similarly titled measures used by other companies.
Reconciliation of GAAP Net Loss to Non-GAAP Adjusted
EBITDA:
The following table reconciles net loss, the most directly
comparable GAAP financial measure, to EBITDA and Adjusted EBITDA,
both of which are non-GAAP financial measures:
|
|
|
|
|
|
(unaudited - in
thousands) |
|
Three Months Ended March 31, |
|
Nine Months Ended March 31, |
|
|
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
Net loss (GAAP) |
|
$ |
(8,080 |
) |
$ |
(14,796 |
) |
$ |
(11,642 |
) |
$ |
(15,221 |
) |
Depreciation and
amortization |
|
6,363 |
|
5,659 |
|
19,087 |
|
15,635 |
|
Interest expense,
net |
|
485 |
|
370 |
|
1,450 |
|
1,028 |
|
Income tax
provision/(benefit) |
|
(23 |
) |
101 |
|
(431 |
) |
113 |
|
EBITDA (non-GAAP) |
|
$ |
(1,255 |
) |
$ |
(8,666 |
) |
$ |
8,464 |
|
$ |
1,555 |
|
Share-based
compensation expense (1) |
|
784 |
|
908 |
|
2,729 |
|
3,224 |
|
Cease-use rent
expense (2) |
|
(396 |
) |
87 |
|
398 |
|
560 |
|
Phoenix distribution
center related expenses (3) |
|
— |
|
59 |
|
— |
|
2,196 |
|
Stockholder nominations
related expenses (4) |
|
— |
|
— |
|
408 |
|
— |
|
Gain on sale of
assets (5) |
|
— |
|
(185 |
) |
(371 |
) |
(556 |
) |
Adjusted EBITDA
(non-GAAP) |
|
$ |
(867 |
) |
$ |
(7,797 |
) |
$ |
11,628 |
|
$ |
6,979 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Adjustment includes charges related to share-based
compensation programs, which vary from period to period depending
on volume and vesting timing of awards. The Company adjusts
for these charges to facilitate comparisons from period to
period.
(2) Adjustment includes accelerated rent expense recognized in
relation to closing stores prior to lease termination. A
favorable lease buyout agreement was negotiated and executed in the
third quarter of fiscal 2018, resulting in the reversal of
previously recorded accelerated cease-use rent expense. While
accelerated rent expense may occur in future periods, the amount
and timing of such expenses will vary from period to period.
(3) Adjustment includes only certain expenses related to the
Phoenix distribution center preparation, ramp up and post go-live
activities, including incremental detention costs and certain
consulting costs.
(4) Adjustment includes only certain incremental expenses which
relate to the stockholder nominations as described in the Company’s
Preliminary and Definitive Proxy Statements filed with the SEC on
September 25, 2017 and October 5, 2017, respectively.
(5) Adjustment includes the gain recognized from the
sale-leaseback transaction which occurred in the fourth quarter of
fiscal 2016.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tuesday Morning Corporation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statement of Operations |
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands, except per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
|
Nine Months Ended March 31, |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2018 |
|
2017 |
|
|
2018 |
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited) |
|
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
sales |
|
|
$ |
223,296 |
|
$ |
203,001 |
|
|
$ |
775,860 |
|
$ |
743,023 |
|
|
|
|
Cost of
sales |
|
|
|
142,993 |
|
|
135,845 |
|
|
|
511,922 |
|
|
492,546 |
|
|
|
|
Gross profit |
|
|
|
80,303 |
|
|
67,156 |
|
|
|
263,938 |
|
|
250,477 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling,
general and administrative expenses |
|
88,092 |
|
|
81,834 |
|
|
|
275,445 |
|
|
265,628 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
|
|
(7,789 |
) |
|
(14,678 |
) |
|
|
(11,507 |
) |
|
(15,151 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income/(expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
|
(493 |
) |
|
(377 |
) |
|
|
(1,473 |
) |
|
(1,061 |
) |
|
|
|
Other income, net |
|
|
|
179 |
|
|
360 |
|
|
|
907 |
|
|
1,104 |
|
|
|
|
Loss before income taxes |
|
|
|
(8,103 |
) |
|
(14,695 |
) |
|
|
(12,073 |
) |
|
(15,108 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
provision/(benefit) |
|
|
|
(23 |
) |
|
101 |
|
|
|
(431 |
) |
|
113 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss |
|
|
$ |
(8,080 |
) |
$ |
(14,796 |
) |
|
$ |
(11,642 |
) |
$ |
(15,221 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
|
|
|
Earnings
per share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
$ |
(0.18 |
) |
$ |
(0.34 |
) |
|
$ |
(0.26 |
) |
$ |
(0.35 |
) |
|
|
|
Diluted |
|
|
$ |
(0.18 |
) |
$ |
(0.34 |
) |
|
$ |
(0.26 |
) |
$ |
(0.35 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
|
44,365 |
|
|
43,998 |
|
|
|
44,236 |
|
|
43,915 |
|
|
|
|
Diluted |
|
|
|
44,365 |
|
|
43,998 |
|
|
|
44,236 |
|
|
43,915 |
|
|
|
|
|
|
|
|
|
|
|
|
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|
Consolidated Balance Sheets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
thousands) |
|
|
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|
March 31, |
|
June 30, |
|
|
March
31, |
|
|
|
|
|
|
|
|
|
|
2018 |
|
2017 |
|
|
2017 |
|
|
|
|
|
|
|
|
|
|
(unaudited) |
|
(audited) |
|
|
(unaudited) |
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
|
|
|
|
|
$ |
12,277 |
|
$ |
6,263 |
|
|
$ |
3,747 |
Inventories |
|
|
|
|
|
|
|
|
244,990 |
|
|
221,906 |
|
|
|
268,309 |
Prepaid expenses |
|
|
|
|
|
|
|
|
6,242 |
|
|
6,367 |
|
|
|
7,388 |
Other current assets |
|
|
|
|
|
|
|
|
1,245 |
|
|
1,982 |
|
|
|
259 |
Total Current Assets |
|
|
|
|
|
|
|
|
264,754 |
|
|
236,518 |
|
|
|
279,703 |
Property
and equipment, net |
|
|
|
|
|
|
|
|
122,115 |
|
|
118,397 |
|
|
|
107,021 |
Deferred
financing costs |
|
|
|
|
|
|
|
|
750 |
|
|
986 |
|
|
|
1,065 |
Other
assets |
|
|
|
|
|
|
|
|
2,781 |
|
|
2,252 |
|
|
|
2,245 |
Total Assets |
|
|
|
|
|
|
|
$ |
390,400 |
|
$ |
358,153 |
|
|
$ |
390,034 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts payable |
|
|
|
|
|
|
|
$ |
86,662 |
|
$ |
67,326 |
|
|
$ |
75,012 |
Accrued liabilities |
|
|
|
|
|
|
|
|
43,789 |
|
|
44,260 |
|
|
|
45,209 |
Income taxes payable |
|
|
|
|
|
|
|
|
77 |
|
|
11 |
|
|
|
104 |
Total Current Liabilities |
|
|
|
|
|
|
|
|
130,528 |
|
|
111,597 |
|
|
|
120,325 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings
under revolving credit facility |
|
|
|
|
|
|
44,400 |
|
|
30,500 |
|
|
|
41,000 |
Deferred
rent |
|
|
|
|
|
|
|
|
21,645 |
|
|
13,883 |
|
|
|
10,537 |
Asset
retirement obligation — non current |
|
|
|
|
|
|
3,100 |
|
|
2,307 |
|
|
|
2,518 |
Other
liabilities — non current |
|
|
|
|
|
|
|
|
835 |
|
|
1,027 |
|
|
|
360 |
Total Liabilities |
|
|
|
|
|
|
|
|
200,508 |
|
|
159,314 |
|
|
|
174,740 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity |
|
|
|
|
|
|
|
|
189,892 |
|
|
198,839 |
|
|
|
215,294 |
Total Liabilities and Stockholders' Equity |
|
|
|
|
|
$ |
390,400 |
|
$ |
358,153 |
|
|
$ |
390,034 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statement of Cash Flows |
|
|
|
|
|
|
|
|
|
|
|
|
(in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended March 31, |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2018 |
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited) |
|
|
|
Cash flows
from operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
|
|
|
|
|
|
$ |
(11,642 |
) |
$ |
(15,221 |
) |
|
|
|
Adjustments to reconcile net loss to net cash provided by
operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
|
|
|
|
|
19,087 |
|
|
15,635 |
|
|
|
|
Amortization of financing costs |
|
|
|
|
|
|
|
236 |
|
|
247 |
|
|
|
|
(Gain)/loss on disposal of assets |
|
|
|
|
|
|
(69 |
) |
|
1 |
|
|
|
|
Gain on sale-leaseback transaction |
|
|
|
|
|
|
(371 |
) |
|
(555 |
) |
|
|
|
Share-based compensation |
|
|
|
|
|
|
|
|
2,729 |
|
|
3,224 |
|
|
|
|
Deferred income taxes |
|
|
|
|
|
|
|
|
(571 |
) |
|
— |
|
|
|
|
Construction allowances from landlords |
|
|
|
|
|
|
6,688 |
|
|
1,419 |
|
|
|
|
Change in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
Inventories |
|
|
|
|
|
|
|
|
(23,122 |
) |
|
(25,970 |
) |
|
|
|
Prepaid and other assets |
|
|
|
|
|
|
|
|
883 |
|
|
(427 |
) |
|
|
|
Accounts payable |
|
|
|
|
|
|
|
|
19,396 |
|
|
(12,841 |
) |
|
|
|
Accrued liabilities |
|
|
|
|
|
|
|
|
2,199 |
|
|
937 |
|
|
|
|
Deferred rent |
|
|
|
|
|
|
|
|
1,921 |
|
|
2,666 |
|
|
|
|
Income taxes payable |
|
|
|
|
|
|
|
|
71 |
|
|
105 |
|
|
|
|
Other liabilities — non-current |
|
|
|
|
|
|
|
367 |
|
|
(338 |
) |
|
|
|
Net cash
provided by/(used in) operating activities |
|
|
|
|
|
|
17,802 |
|
|
(31,118 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows
from investing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures |
|
|
|
|
|
|
|
|
(25,552 |
) |
|
(27,359 |
) |
|
|
|
Purchase of intellectual property |
|
|
|
|
|
|
|
(30 |
) |
|
(4 |
) |
|
|
|
Proceeds from sale of assets |
|
|
|
|
|
|
|
|
69 |
|
|
93 |
|
|
|
|
Net cash
used in investing activities |
|
|
|
|
|
|
(25,513 |
) |
|
(27,270 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows
from financing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds under revolving credit facility |
|
|
|
|
|
|
153,900 |
|
|
152,200 |
|
|
|
|
Repayments under revolving credit facility |
|
|
|
|
|
|
(140,000 |
) |
|
(111,200 |
) |
|
|
|
Change in cash overdraft |
|
|
|
|
|
|
|
|
(60 |
) |
|
7,000 |
|
|
|
|
Purchase of treasury stock |
|
|
|
|
|
|
|
|
— |
|
|
8 |
|
|
|
|
Proceeds from exercise of common stock options |
|
|
|
|
|
|
4 |
|
|
(23 |
) |
|
|
|
Payments on capital leases |
|
|
|
|
|
|
|
|
(119 |
) |
|
- |
|
|
|
|
Net cash
provided by financing activities |
|
|
|
|
|
|
13,725 |
|
|
47,985 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase/(decrease) in cash and cash equivalents |
|
|
|
|
|
|
6,014 |
|
|
(10,403 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and
cash equivalents, beginning of period |
|
|
|
|
|
|
6,263 |
|
|
14,150 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and
cash equivalents, end of period |
|
|
|
|
|
$ |
12,277 |
|
$ |
3,747 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
INVESTOR RELATIONS:Farah Soi / Caitlin
MorahanICR203-682-8200Farah.Soi@icrinc.comCaitlin.Morahan@icrinc.com
MEDIA: Blynn AustinPerry Street
Communications214-965-9955BAustin@perryst.com
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