♦ Company is experiencing strong ecommerce demand in its Gourmet
Foods and Gift Baskets brands and its 1-800-Flowers Consumer Floral
business, including a strong Mother’s Day holiday period as well as
increased demand for every-day gifting occasions.
♦ Total consolidated revenues for Fiscal 2020 are now expected
to grow in a range of 16-to-18 percent, compared with the prior
year, up from a previous range of 8-to-9 percent.
♦ Adjusted EPS1 for Fiscal 2020 is now expected to grow in a
range of 75-to-85 percent, up from a previous range of 15-to-17
percent and Adjusted EBITDA1 is now expected to grow in a range of
50-to-55 percent, up from a previous range of 13-to-15 percent.
♦ Free Cash Flow1 is now expected to be in a range of $75-to-$85
million, up from a previous range of $45-to-$50 million.
(1 Refer to “Definitions of Non-GAAP Financial Measures” at the
end of this press release.)
1-800-FLOWERS.COM, Inc. (NASDAQ: FLWS), a leading provider of
gifts designed to help customers express, connect and celebrate,
today reported that it is raising revenue and earnings guidance for
its fiscal 2020 full year based on solid results through the first
three quarters of the year combined with significantly increased
ecommerce demand through the first ten weeks of its current fiscal
fourth quarter.
Chris McCann, CEO, 1-800-FLOWERS.COM, Inc., said, “As we
continue to grapple with the challenges of the COVID-19 pandemic,
our gratitude goes out to all those who have been working on the
front lines helping our country battle this crisis. I would also
like to thank all our associates across the Company who have worked
tirelessly in this difficult environment to help our customers stay
connected while remaining focused on keeping safety and health at
the forefront of all we do. Throughout this period, we have seen
customers turn to us in record numbers to express themselves, to
connect with the important people in their lives, and to celebrate
life’s many events. As we noted in our April 30 press release on
our fiscal third quarter results, we saw consumer demand begin to
accelerate in late March and continue through April, including a
record Easter holiday period. This trend has continued through May,
including a very strong Mother’s Day holiday, and into the first
two weeks of June. For both holidays and everyday occasions,
consumers are increasingly turning to our family of brands and
broad product collections to help them connect and express
themselves during this difficult period.”
McCann attributed the significant increase in the Company’s
earnings guidance primarily to a combination of accelerated revenue
growth, coupled with reduced marketing costs in its current fiscal
fourth quarter. “With the very efficient marketing leverage we have
in this current advertising environment we are able to more cost
effectively engage with our customers. As a result, we are seeing
increasing demand from existing customers as well as accelerated
growth in new customers and increased membership in our
Celebrations Passport® loyalty program.”
Regarding the Company’s outlook for its fiscal 2021 year, McCann
said, “While we are encouraged by the strong growth we have
achieved year to date, during fiscal 2021 we do not anticipate
replicating the record top and bottom-line performance we are
seeing in our fiscal 2020 fourth quarter. We face some headwinds
going into the new fiscal year reflecting the impacts of the
COVID-19 pandemic, including an uncertain consumer economy,
increased operating costs and significantly reduced order volumes
from wholesale customers for the calendar year-end holiday
season.”
McCann added, “We are proud of the strong and highly
leverageable business platform we have built – our Celebrations
Ecosystem – which has enabled us to ramp up quickly to meet the
accelerated demand we have seen through this recent period. As the
country begins to reopen, we see a number of trends from which we
are well-positioned to benefit, including the accelerated consumer
shift to ecommerce for more of their everyday and holiday needs,
reduced travel and more “home nesting,” and the prevailing
sentiments around the need for people to stay connected, express
themselves and to find ways to celebrate – sentiments at the core
of our vision as a company.”
COMPANY GUIDANCE The Company
is raising its growth guidance for fiscal 2020 as follows:
- Total consolidated revenue growth of 16-to-18 percent, up from
a previous range of 8-to-9 percent, compared with the prior year,
including approximately 13-to-15 percent organic revenue growth
combined with contributions from the Shari’s Berries brand, which
the Company acquired in August 2019;
- Adjusted EPS1 growth in a range of 75-to-85 percent, up from a
previous range of 15-to-17 percent, compared with the prior
year;
- Adjusted EBITDA1 growth in a range of 50-to-55 percent, up from
a previous range of 13-to-15 percent, compared with the prior year,
and;
- Free Cash Flow for the year to be in a range of $75-to-$85
million, up from a previous range of $45-to-$50 million.
The Company plans to release its fiscal 2020 fourth quarter and
full-year results on August 27, 2020.
Note: The Company’s guidance for Fiscal Year 2020 Adjusted EPS1
and Adjusted EBITDA1 excludes certain one-time costs, expected to
be recognized in the fourth quarter, associated with the closing of
its Harry & David retail stores and costs associated with its
planned acquisition of PersonalizationMall.com.
Note: The Company is providing today’s update in the spirit of
transparency and due to the unprecedented business conditions
related to the COVID-19 pandemic. Going forward, the Company
expects to continue its traditional quarterly reporting cadence and
does not intend to issue further intra-quarter business
updates.
Definitions of non-GAAP Financial
Measures: We sometimes use financial measures derived
from consolidated financial information, but not presented in our
financial statements prepared in accordance with U.S. generally
accepted accounting principles (“GAAP”). Certain of these are
considered "non-GAAP financial measures" under the U.S. Securities
and Exchange Commission rules. Non-GAAP financial measures referred
to in this document are either labeled as “non-GAAP” or designated
as such with a “1”. See below for definitions and the reasons why
we use these non-GAAP financial measures. Refer to the Selected
Financial Information contained in our earnings press release dated
April 30, 2020, as filed on Form 8-K on April 30, 2020, for a
reconciliation of these non-GAAP measures to their most directly
comparable financial measures for the three and nine months ended
March 29, 2020.
EBITDA and Adjusted EBITDA We define EBITDA as net income
(loss) before interest, taxes, depreciation and amortization.
Adjusted EBITDA is defined as EBITDA adjusted for the impact of
stock-based compensation, Non-Qualified Plan Investment
appreciation/depreciation, and for certain items affecting
period-to-period comparability. The Company presents EBITDA and
Adjusted EBITDA because it considers such information meaningful
supplemental measures of its performance and believes such
information is frequently used by the investment community in the
evaluation of similarly situated companies. The Company uses EBITDA
and Adjusted EBITDA as factors to determine the total amount of
incentive compensation available to be awarded to executive
officers and other employees. The Company's credit agreement uses
EBITDA and Adjusted EBITDA to determine its interest rate and to
measure compliance with certain covenants. EBITDA and Adjusted
EBITDA are also used by the Company to evaluate and price potential
acquisition candidates. EBITDA and Adjusted EBITDA have limitations
as analytical tools and should not be considered in isolation or as
a substitute for analysis of the Company's results as reported
under GAAP. Some of the limitations are: (a) EBITDA and Adjusted
EBITDA do not reflect changes in, or cash requirements for, the
Company's working capital needs; (b) EBITDA and Adjusted EBITDA do
not reflect the significant interest expense, or the cash
requirements necessary to service interest or principal payments,
on the Company's debts; and (c) although depreciation and
amortization are non-cash charges, the assets being depreciated and
amortized may have to be replaced in the future and EBITDA does not
reflect any cash requirements for such capital expenditures. EBITDA
and Adjusted EBITDA should only be used on a supplemental basis
combined with GAAP results when evaluating the Company's
performance.
Adjusted Earnings (Loss) Per Common Share (Adjusted EPS):
We define Adjusted Earnings (Loss) Per Common Share (Adjusted EPS)
as Net Income (Loss) Per Common Share adjusted for certain items
affecting period to period comparability. We believe that Adjusted
Earnings (Loss) Per Common Share (Adjusted EPS) is a meaningful
measure because it increases the comparability of period to period
results. Since this is not measures of performance calculated in
accordance with GAAP, it should not be considered in isolation of,
or as a substitute for, GAAP Net Income (Loss) Per Common share
(EPS), as an indicator of operating performance and it may not be
comparable to similarly titled measures employed by other
companies.
Free Cash Flow We define Free Cash Flow as net cash
provided by operating activities, less capital expenditures. The
Company considers Free Cash Flow to be a liquidity measure that
provides useful information to management and investors about the
amount of cash generated by the business after the purchases of
fixed assets, which can then be used to, among other things, invest
in the Company’s business, make strategic acquisitions, strengthen
the balance sheet and repurchase stock or retire debt. Free Cash
Flow is a liquidity measure that is frequently used by the
investment community in the evaluation of similarly situated
companies. Since Free Cash Flow is not a measure of performance
calculated in accordance with GAAP, it should not be considered in
isolation or as a substitute for analysis of the Company's results
as reported under GAAP. A limitation of the utility of Free Cash
Flow as a measure of financial performance is that it does not
represent the total increase or decrease in the Company's cash
balance for the period.
About 1-800-FLOWERS.COM, Inc. 1-800-FLOWERS.COM, Inc. is
a leading provider of gifts designed to help customers express,
connect and celebrate. The Company’s Celebrations Ecosystem
features our all-star family of brands, including:
1-800-Flowers.com®, 1-800-Baskets.com®, Cheryl’s Cookies®, Harry
& David®, Shari’s Berries®, FruitBouquets.com®, Moose Munch®,
The Popcorn Factory®, Wolferman’s Bakery℠, Personalization
Universe®, Simply Chocolate®, and Goodsey®. We also offer
top-quality steaks and chops from Stock Yards®. Through the
Celebrations Passport® loyalty program, which provides members with
free standard shipping and no service charge across our portfolio
of brands, 1-800-FLOWERS.COM, Inc. strives to deepen relationships
with customers. The Company also operates BloomNet®, an
international floral wire service providing a broad-range of
products and services designed to help professional florists grow
their businesses profitably; Napco SM, a resource for floral gifts
and seasonal décor; and DesignPac Gifts, LLC, a manufacturer of
gift baskets and towers. 1-800-FLOWERS.COM, Inc. was recognized as
the 2019 Mid-Market Company of the Year by CEO Connection. Shares
in 1-800-FLOWERS.COM, Inc. are traded on the NASDAQ Global Select
Market, ticker symbol: FLWS. For more information, visit
1800flowersinc.com or follow @1800FLOWERSInc on Twitter.
Special Note Regarding Forward Looking
Statements: This press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements represent the
Company’s current expectations or beliefs concerning future events
and can generally be identified using statements that include words
such as “estimate,” “expects,” “project,” “believe,” “anticipate,”
“intend,” “plan,” “foresee,” “forecast,” “likely,” “will,” “target”
or similar words or phrases. These forward-looking statements are
subject to risks, uncertainties and other factors, many of which
are outside of the Company’s control which could cause actual
results to differ materially from the results expressed or implied
in the forward-looking statements, including, but not limited to,
statements regarding the Company’s ability to achieve its raised
guidance for fiscal-year 2020; the impact of the COVID-19 pandemic
on the Company; its ability to leverage its operating platform and
reduce operating expense ratio; its ability to successfully
integrate acquired businesses and assets; its ability to cost
effectively acquire and retain customers; the outcome of
contingencies, including legal proceedings in the normal course of
business; its ability to compete against existing and new
competitors; its ability to manage expenses associated with sales
and marketing and necessary general and administrative and
technology investments; its ability to reduce promotional
activities and achieve more efficient marketing programs; and
general consumer sentiment and economic conditions that may affect
levels of discretionary customer purchases of the Company’s
products. Reconciliations for forward looking figures would require
unreasonable efforts at this time because of the uncertainty and
variability of the nature and number of certain components of
various necessary GAAP components, including for example those
related to compensation, tax items, amortization or others that may
arise during the year, and the Company’s management believes such
reconciliations would imply a degree of precision that would be
confusing or misleading to investors. The lack of such reconciling
information should be considered when assessing the impact of such
disclosures. The Company undertakes no obligation to publicly
update any of the forward-looking statements, whether because of
new information, future events or otherwise, made in this release
or in any of its SEC filings. Consequently, you should not consider
any such list to be a complete set of all potential risks and
uncertainties. For a more detailed description of these and other
risk factors, refer to the Company’s SEC filings, including the
Company’s Annual Reports on Form 10-K and its Quarterly Reports on
Form 10-Q.
FLWS-CP
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version on businesswire.com: https://www.businesswire.com/news/home/20200618005197/en/
Investor Contact: Joseph D. Pititto
(516) 237-6131 E-mail: invest@1800flowers.com
Media Contact: Kathleen Waugh (516)
237-6028 kwaugh@1800flowers.com
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