Tuesday Morning Corporation (NASDAQ: TUES), one of
the original off-price retailers currently with over 715 stores
across the United States specializing in name-brand, high-quality
products for the home, including upscale textiles, furnishings,
housewares, gourmet food, toys and seasonal decor, today announced
financial results for the fourth quarter and fiscal year ended June
30, 2018.
Steve Becker, Chief Executive Officer, stated,
“Our fourth quarter and spring results demonstrate continued
momentum at Tuesday Morning with our comparable
store sales coming in at the high end of our previous
guidance. For the second half of fiscal 2018, we
saw strong comparable sales, positive performance in our base
stores, improvement in inventory turn and overall inventory
freshness and, despite transportation headwinds, gross
margin improvement of approximately 250 basis points. While
much work remains to be done, we are pleased with the progress we
have made to date and are focused on continued opportunities to
drive further sales productivity in our store base while increasing
overall profitability.”
Fourth Quarter Fiscal 2018 Results of
Operations
- Net sales were $230.5 million, compared to $223.6 million for
the fourth quarter of fiscal 2017. The Company’s sales
comparison to the prior year is impacted by the net closure of five
stores during the last twelve months.
- Comparable store sales increased 2.4% compared to the same
period a year ago, and were comprised of a 1.4% increase in
customer transactions along with a 1.0% increase in average
ticket. During the fourth quarter, nine stores were
relocated, two stores were opened, and one store was expanded, for
an ending store count of 726 as of June 30, 2018. Sales at
the 45 stores relocated during the past 12 months increased
approximately 50% on average for the fourth quarter of fiscal 2018
as compared to the prior year quarter and contributed approximately
310 basis points of comparable store sales growth, driven primarily
by better real estate and larger average store footprint. The
Company's third quarter was positively impacted while the fourth
quarter was negatively impacted, each by approximately 300 basis
points, due to a shift of a promotional event and the timing of
Easter. For the six month period ending June 30, 2018, which
eliminates the impact of the shift in holiday and promotional
events, comparable store sales increased 5.6%.
- Gross profit increased $6.7 million to $77.0 million compared
to $70.3 million of gross profit in the fourth quarter of fiscal
2017. Gross margin for the fourth quarter of fiscal 2018 was
33.4% compared to 31.4% last year. The increase in gross
margin for the quarter was driven by a significant decrease in net
supply chain costs as a percentage of sales recognized in the
fourth quarter fiscal 2018 compared to the prior year. Those
prior year elevated costs were incurred primarily due to the supply
chain issues the Company experienced in fiscal 2017. In the
current year, the Company has realized cost efficiencies in its
distribution operations, along with reduced markdowns and continued
improvement in initial merchandise mark-up which have contributed
to improvements in gross margin. Partially offsetting these
improvements were increased current year freight costs.
- Selling, general and administrative expenses (SG&A)
decreased $0.9 million to $86.5 million in the fourth quarter of
fiscal 2018, compared to $87.4 million in the same period last
year. As a percentage of net sales, SG&A was 37.5% for
the fourth quarter of fiscal 2018 compared to 39.1% in the same
period last year, leveraging approximately 160 basis points.
This decrease in SG&A as a percentage of net sales was driven
primarily by leveraging store labor costs, reduced advertising
expenses due in part to promotional timing, and reduced real estate
projects and related expenses, as well as reductions in certain
corporate expenses, including labor, severance and share-based
compensation 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.
- The Company’s operating loss for the fourth quarter of fiscal
2018 was $9.4 million, compared to an operating loss of $17.1
million in the fourth quarter of fiscal 2017, an improvement of
45%.
- The Company reported a net loss of $10.3 million, or $0.23 per
share, for the fourth quarter of fiscal 2018 compared to a net loss
of $17.3 million, or $0.39 per share, for the fourth quarter of
fiscal 2017.
- EBITDA, a non-GAAP measure, was negative $2.8 million for the
fourth quarter of fiscal 2018, compared to EBITDA of negative $11.1
million for the prior year period. Adjusted EBITDA, a
non-GAAP measure, was negative $2.0 million for the fourth quarter
of fiscal 2018, compared to Adjusted EBITDA of negative $9.8
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.
Fiscal 2018 Results of Operations
- Net sales were $1.0 billion, compared to $966.7 million for
fiscal 2017. The Company’s sales comparison to the prior year
is impacted by the net closure of five stores during the last
twelve months.
- Comparable store sales increased 3.9% compared to the prior
year, and were comprised of a 2.9% increase in customer
transactions, along with a 1.0% increase in average ticket.
During fiscal 2018, 45 stores were relocated, 15 stores were
opened, eight stores were expanded, and 20 stores were closed, for
an ending store count of 726 as of June 30, 2018. Sales at
the 45 stores relocated during the past 12 months increased
approximately 58% on average for fiscal 2018 as compared to the
prior year and contributed approximately 370 basis points of
comparable store sales growth, driven primarily by better real
estate and larger average store footprint.
- Gross profit increased $20.3 million to $341.0 million compared
to $320.7 million of gross profit in fiscal 2017. Gross
margin for fiscal 2018 was 33.9% compared to 33.2% last year.
The increase in gross margin was primarily due to improvements in
initial merchandise mark-up and reduced markdowns, along with
reduced distribution and freight costs recognized in the current
year from the elevated costs incurred in the prior year as a result
of the supply chain issues the Company experienced in fiscal
2017. In the current year, the Company has achieved and
recognized cost efficiencies in its distribution operations,
partially offset by increased current year freight
costs.
- SG&A increased $8.9 million to $361.9 million in fiscal
2018, compared to $353.0 million in the prior year. As a
percentage of net sales, SG&A decreased to 36.0% for 2018 from
36.5% in fiscal 2017. This decrease in SG&A as a
percentage of net sales was driven primarily by reductions in
certain corporate expenses, including labor, severance, and
share-based compensation 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, along with reduced
promotional spending. 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 fiscal 2018 was $21.0 million,
compared to an operating loss of $32.3 million for the prior year,
an improvement of 35%.
- The Company reported a net loss of $21.9 million, or $0.50 per
share, for fiscal 2018 compared to a net loss of $32.5 million, or
$0.74 per share, for the prior year. The Company’s net loss
in the current year reflects a favorable tax impact of
approximately $0.6 million resulting from recent tax law
changes.
- EBITDA, a non-GAAP measure, was $5.6 million for fiscal 2018,
compared to EBITDA of negative $9.6 million for the prior
year. Adjusted EBITDA, a non-GAAP measure, was $9.6 million
for fiscal 2018, compared to Adjusted EBITDA of negative $2.8
million for the prior year, primarily driven by the change in net
loss as compared to the prior year as adjusted for incremental
costs relating to the ramp-up of the Company’s Phoenix distribution
center in the prior year. A reconciliation of GAAP and
non-GAAP measures is provided below.
The Company ended fiscal 2018 with $9.5 million
in cash and cash equivalents. The Company had $38.5 million
outstanding under its line of credit with availability on the line
of $60.5 million. Inventories at the end of fiscal 2018 were
$234.4 million compared to $221.9 million at the end of fiscal
2017. The increase in inventory was driven primarily by
higher distribution center and in-transit inventory levels, in
support of increased sales trends and in preparation for the fall
selling season. The Company’s inventory turnover for
the trailing five quarters as of June 30, 2018 was 2.8 turns, an
improvement of approximately 12% from the trailing five quarter
turnover as of June 30, 2017 of 2.5 turns.
Fiscal Year 2019 OutlookThe Company currently
expects comparable store sales for fiscal 2019 to increase 3%
to 5%. The Company also expects year over year
improvement in gross margin driven by improved product margin and
lower supply chain expenses, partially offset by higher
transportation costs. Selling, general and
administrative expenses are expected to deleverage
modestly due to the normalization of incentive compensation
based on the Company’s expectation of achieving its fiscal 2019
financial goals and the impact of retention costs as disclosed in
its third quarter fiscal 2018 filing with the Securities and
Exchange Commission. For the year, the Company
expects significant EBITDA improvement compared to fiscal
2018.
The Company currently plans to open 10 to 12 new
stores, relocate 15 to 20 stores, expand one to three stores and
close 20 to 30 stores in fiscal 2019. Net capital
expenditures for fiscal 2019 are expected to be in the range of
approximately $15 million to $20 million. The reduced
level of capital spend from prior years reflects fewer relocations
and new stores, partially offset by higher investments in
information technology. The Company currently does not
anticipate its fiscal 2019 ending net debt balance to increase from
its fiscal 2018 ending position and currently expects to have
approximately $65 million of availability on its line of credit at
its seasonal borrowing peak.
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,
including upscale textiles, furnishings, housewares, gourmet food,
toys and seasonal decor. Based in Dallas, Texas, the Company
opened its first store in 1974 and operates over 715 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
fourth quarter and fiscal 2018 financial results and provide a
general business update today, August 21 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, August 21, 2018 through 10:59 a.m., Central Time,
Friday, August 24, 2018 by dialing (855) 859-2056 or (404) 537-3406
and entering conference ID number 2168059.
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 most
recent Annual Report on Form 10-K, 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 ability to identify and respond to changes
in consumer trends and preferences; our ability to mitigate
reductions of customer traffic in shopping centers where our stores
are located; 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 including tariffs; 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; 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 June 30, |
|
Twelve Months Ended June 30, |
|
|
|
2018 |
|
2017 |
|
2018 |
|
2017 |
|
Net loss (GAAP) |
|
$ |
(10,296 |
) |
$ |
(17,321 |
) |
$ |
(21,938 |
) |
$ |
(32,542 |
) |
Depreciation and
amortization |
|
6,585 |
|
5,714 |
|
25,672 |
|
21,349 |
|
Interest expense,
net |
|
580 |
|
416 |
|
2,030 |
|
1,443 |
|
Income tax
provision/(benefit) |
|
292 |
|
84 |
|
(139 |
) |
197 |
|
EBITDA (non-GAAP) |
|
$ |
(2,839 |
) |
$ |
(11,107 |
) |
$ |
5,625 |
|
$ |
(9,553 |
) |
Share-based
compensation expense (1) |
|
703 |
|
960 |
|
3,433 |
|
4,184 |
|
Cease-use rent
expense (2) |
|
89 |
|
575 |
|
487 |
|
1,135 |
|
Phoenix distribution
center related expenses (3) |
|
— |
|
— |
|
— |
|
2,196 |
|
Stockholder nominations
related expenses (4) |
|
— |
|
— |
|
408 |
|
— |
|
Gain on sale of
assets (5) |
|
— |
|
(185 |
) |
(371 |
) |
(741 |
) |
Adjusted EBITDA
(non-GAAP) |
|
$ |
(2,047 |
) |
$ |
(9,757 |
) |
$ |
9,582 |
|
$ |
(2,779 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Adjustment includes charges related to share-based
compensation programs, which vary from period to period depending
on volume, timing, and vesting 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.
Favorable lease buyout agreements were negotiated and executed in
fiscal 2018, resulting in the reversal of $0.7 million 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 June 30, |
|
|
Twelve Months Ended June 30, |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2018 |
|
2017 |
|
|
2018 |
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited) |
|
|
(audited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
sales |
|
$ |
230,473 |
|
$ |
223,642 |
|
|
$ |
1,006,332 |
|
$ |
966,665 |
|
Cost of
sales |
|
|
153,437 |
|
|
153,374 |
|
|
|
665,358 |
|
|
645,920 |
|
|
|
|
Gross profit |
|
|
77,036 |
|
|
70,268 |
|
|
|
340,974 |
|
|
320,745 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling,
general and administrative expenses |
|
86,479 |
|
|
87,397 |
|
|
|
361,924 |
|
|
353,025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
|
(9,443 |
) |
|
(17,129 |
) |
|
|
(20,950 |
) |
|
(32,280 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income/(expense): |
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
(587 |
) |
|
(424 |
) |
|
|
(2,061 |
) |
|
(1,485 |
) |
|
Other income, net |
|
|
26 |
|
|
316 |
|
|
|
934 |
|
|
1,420 |
|
Loss before
income taxes |
|
|
(10,004 |
) |
|
(17,237 |
) |
|
|
(22,077 |
) |
|
(32,345 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
provision/(benefit) |
|
|
292 |
|
|
84 |
|
|
|
(139 |
) |
|
197 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss |
|
$ |
(10,296 |
) |
$ |
(17,321 |
) |
|
$ |
(21,938 |
) |
$ |
(32,542 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings
per share |
|
|
|
|
|
|
|
|
|
|
Net loss
per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(0.23 |
) |
$ |
(0.39 |
) |
|
$ |
(0.50 |
) |
$ |
(0.74 |
) |
|
|
Diluted |
|
$ |
(0.23 |
) |
$ |
(0.39 |
) |
|
$ |
(0.50 |
) |
$ |
(0.74 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average number of common shares: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
44,423 |
|
|
44,027 |
|
|
|
44,282 |
|
|
43,943 |
|
|
|
Diluted |
|
|
44,423 |
|
|
44,027 |
|
|
|
44,282 |
|
|
43,943 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tuesday Morning Corporation (continued) |
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|
|
|
|
|
|
|
|
|
Consolidated Balance Sheets |
|
|
|
|
|
|
|
|
|
|
(in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30, |
|
June 30, |
|
|
|
|
|
|
|
|
|
|
|
|
2018 |
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
(audited) |
|
(audited) |
Assets |
|
|
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
|
|
|
|
$ |
9,510 |
|
$ |
6,263 |
|
|
Inventories |
|
|
|
|
|
|
|
234,365 |
|
|
221,906 |
|
|
Prepaid expenses |
|
|
|
|
|
|
|
6,301 |
|
|
6,367 |
|
|
Other current assets |
|
|
|
|
|
|
|
1,206 |
|
|
1,982 |
|
|
|
|
Total Current Assets |
|
|
|
|
|
|
|
251,382 |
|
|
236,518 |
|
Property
and equipment, net |
|
|
|
|
|
|
|
121,117 |
|
|
118,397 |
|
Deferred
financing costs |
|
|
|
|
|
|
|
671 |
|
|
986 |
|
Other
assets |
|
|
|
|
|
|
|
3,086 |
|
|
2,252 |
|
|
|
|
Total Assets |
|
|
|
|
|
|
$ |
376,256 |
|
$ |
358,153 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Accounts payable |
|
|
|
|
|
|
$ |
88,912 |
|
$ |
67,326 |
|
|
Accrued liabilities |
|
|
|
|
|
|
|
41,765 |
|
|
44,260 |
|
|
Income taxes payable |
|
|
|
|
|
|
|
66 |
|
|
11 |
|
|
|
|
Total Current Liabilities |
|
|
|
|
|
|
|
130,743 |
|
|
111,597 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings
under revolving credit facility |
|
|
|
|
|
|
38,480 |
|
|
30,500 |
|
Deferred
rent |
|
|
|
|
|
|
|
22,883 |
|
|
13,883 |
|
Asset
retirement obligation — non-current |
|
|
|
|
|
|
3,100 |
|
|
2,307 |
|
Other
liabilities — non-current |
|
|
|
|
|
|
|
796 |
|
|
1,027 |
|
|
|
|
Total Liabilities |
|
|
|
|
|
|
|
196,002 |
|
|
159,314 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity |
|
|
|
|
|
|
|
180,254 |
|
|
198,839 |
|
|
|
|
Total Liabilities and Stockholders' Equity |
|
|
|
|
|
$ |
376,256 |
|
$ |
358,153 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tuesday Morning Corporation (continued) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statement of Cash Flows |
|
|
|
|
|
|
|
|
|
(in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended June 30, |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2018 |
|
2017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(audited) |
Cash flows
from operating activities: |
|
|
|
|
|
|
|
|
|
|
Net loss |
|
|
|
|
|
|
$ |
(21,938 |
) |
$ |
(32,542 |
) |
|
Adjustments to reconcile net loss to net cash provided by
operating activities: |
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
|
|
|
|
25,671 |
|
|
21,349 |
|
|
|
Amortization of financing costs |
|
|
|
|
|
|
315 |
|
|
326 |
|
|
|
Loss on disposal of assets |
|
|
|
|
|
|
|
82 |
|
|
79 |
|
|
|
Gain on sale-leaseback transaction |
|
|
|
|
|
|
(371 |
) |
|
(741 |
) |
|
|
Share-based compensation |
|
|
|
|
|
|
|
3,433 |
|
|
4,184 |
|
|
|
Deferred income taxes |
|
|
|
|
|
|
|
(565 |
) |
|
31 |
|
|
Construction allowances from landlords |
|
|
|
|
|
|
8,568 |
|
|
2,566 |
|
|
Change in operating assets and liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Inventories |
|
|
|
|
|
|
|
(12,543 |
) |
|
20,339 |
|
|
|
Prepaid and other assets |
|
|
|
|
|
|
|
559 |
|
|
(1,138 |
) |
|
|
Accounts payable |
|
|
|
|
|
|
|
22,612 |
|
|
(16,337 |
) |
|
|
Accrued liabilities |
|
|
|
|
|
|
|
(362 |
) |
|
(2,047 |
) |
|
|
Deferred rent |
|
|
|
|
|
|
|
1,280 |
|
|
4,964 |
|
|
|
Income taxes payable |
|
|
|
|
|
|
|
62 |
|
|
19 |
|
|
|
Other liabilities — non-current |
|
|
|
|
|
|
368 |
|
|
(648 |
) |
Net cash
provided by operating activities |
|
|
|
|
|
|
27,171 |
|
|
404 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows
from investing activities: |
|
|
|
|
|
|
|
|
|
|
Capital expenditures |
|
|
|
|
|
|
|
(30,764 |
) |
|
(41,682 |
) |
|
Proceeds from sale-leaseback transaction |
|
|
|
|
|
|
- |
|
|
- |
|
|
Purchase of intellectual property |
|
|
|
|
|
|
(42 |
) |
|
(5 |
) |
|
Proceeds from sale of assets |
|
|
|
|
|
|
|
83 |
|
|
127 |
|
Net cash
used in investing activities |
|
|
|
|
|
|
(30,723 |
) |
|
(41,560 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows
from financing activities: |
|
|
|
|
|
|
|
|
|
|
Proceeds under revolving credit facility |
|
|
|
|
|
|
195,500 |
|
|
176,500 |
|
|
Repayments under revolving credit facility |
|
|
|
|
|
|
(187,520 |
) |
|
(146,000 |
) |
|
Change in cash overdraft |
|
|
|
|
|
|
|
(1,026 |
) |
|
2,810 |
|
|
Proceeds from the exercise of employee stock options |
|
|
|
|
|
|
4 |
|
|
8 |
|
|
Payments on capital leases |
|
|
|
|
|
|
|
(159 |
) |
|
(26 |
) |
|
Purchase of treasury stock |
|
|
|
|
|
|
|
- |
|
|
(23 |
) |
Net cash
provided by financing activities |
|
|
|
|
|
|
6,799 |
|
|
33,269 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase/(decrease) in cash and cash equivalents |
|
|
|
|
|
|
3,247 |
|
|
(7,887 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and
cash equivalents, beginning of period |
|
|
|
|
|
|
6,263 |
|
|
14,150 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and
cash equivalents, end of period |
|
|
|
|
|
$ |
9,510 |
|
$ |
6,263 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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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