Francesca’s Holdings Corporation (Nasdaq: FRAN) today reported
financial results for the second quarter ended August 3,
2019.
Michael Prendergast, Interim CEO, stated, “We are very pleased
to see significant improvement in our comparable sales for the
second quarter. After a long period of double digit comp sales
declines we achieved considerable sequential improvement in our
comp sales in each month within the quarter. Gross margin was
impacted by aggressive markdowns on poor performing legacy products
that we accelerated within the quarter. However, we saw strong and
better than expected sell through on new merchandise. Our merchant
teams have done an excellent job of shifting back to a “read and
react” buying and planning strategy, resulting in more nimble
buying and planning processes. We believe effective implementation
of this data analytic and customer demand strategy is driving a
meaningful improvement in both boutique traffic and conversion
during the second quarter. We realized material savings this
quarter through a number of cost reduction initiatives that we have
been executing since the beginning of fiscal 2019. In
addition, we continue to make headway in optimizing our real estate
portfolio. We are extremely pleased with our progress, which we
believe is validating our go-forward turnaround strategy and look
forward to driving continued positive momentum in the
business.”
SECOND QUARTER RESULTS
Net sales decreased 6% to $106.0 million from $113.0 million in
the comparable prior year quarter due to a 5% decrease in
comparable sales. The decrease in comparable sales was the result
of lower average unit retail prices associated with deeper
markdowns on legacy product. This decrease was partially
offset by higher boutique conversion rates and higher average units
per transaction. The Company opened one new boutique and closed
five boutiques during the second quarter, bringing its total
boutique count to 718 at the end of the quarter.
Gross profit, as a percent of net sales, decreased to 38.2% from
39.0% in the prior year quarter. This unfavorable variance
was due to lower merchandise margins as a result of deeper
markdowns on legacy product and deleveraging of occupancy costs as
a result of lower sales.
Selling, general and administrative (SG&A) expenses
decreased 10% to $39.1 million from $43.3 million in the prior year
quarter. Adjusted SG&A in the second quarter of fiscal 2019 was
$38.7 million and excludes $0.5 million in other payroll costs
associated with the Company’s turnaround plan, $0.3 million of
professional fees incurred in connection with the Company’s
previously announced reverse stock split and adoption of a
shareholder rights plan, and $0.3 million of stock-based
compensation reversal associated with the departure of the
Company’s former Chief Financial Officer. There were no non-GAAP
adjustments for SG&A in the second quarter of fiscal 2018.
The $4.6 million decrease in adjusted SG&A in the second
quarter of fiscal year 2019 versus the comparable prior year period
was primarily due to a $2.5 million decrease in boutique payroll
and supplies associated with the Company’s cost reduction
initiatives under the turnaround plan. Additionally, corporate
payroll and related expenses decreased $0.9 million primarily due
to the lower headcount as a result of the February 2019 workforce
reduction, marketing expenses decreased $0.4 million, and asset
write-off charges related to boutique remodels decreased $0.3
million.
Income from operations was $1.4 million compared to $0.8 million
in the prior year quarter. Excluding the adjustments noted
above for adjusted SG&A, adjusted income from operations in the
second quarter of fiscal year 2019 was $1.8 million. There were no
non-GAAP adjustments for income from operations in the second
quarter of fiscal 2018.
The Company’s income tax benefit was $0.3 million in the second
quarter of this year compared to an income tax expense of $0.4
million in the comparable prior year quarter. The income tax
benefit recognized in the second quarter was based on the Company’s
revised estimate of its annualized taxable income for fiscal year
2019.
Net income for the second quarter was $1.8 million, or $0.61
diluted earnings per share, compared to $0.5 million, or $0.16
diluted earnings per share, in the prior year quarter. Adjusted net
income for the second quarter of fiscal year 2019 was $2.1 million,
or $0.72 adjusted diluted earnings per share. There were no
non-GAAP adjustments for net income or diluted earnings per share
in the second quarter of fiscal 2018.
Please see the reconciliation of adjusted SG&A, adjusted
income from operations, adjusted income before income tax expense,
adjusted income tax (benefit) expense, adjusted net income, and
adjusted diluted earnings per share, each a non-GAAP financial
measure, to the most directly comparable GAAP financial measure
provided in the tables at the end of this press release.
BALANCE SHEET SUMMARY
Total cash and cash equivalents at the end of the second quarter
ended August 3, 2019 were $22.0 million compared to $23.4 million
at the end of the comparable prior year quarter. On August 3,
2019, the Company had $10.0 million outstanding borrowings under
its Asset Based Revolving Credit Facility (the “ABL”).
As previously disclosed, the Company entered into a Term Loan
Credit Agreement (the “Term Loan”) with Tiger Finance, LLC for an
aggregate term loan of $10.0 million which matures on August 13,
2022. The proceeds from this Term Loan were used to pay the $10.0
million outstanding under the Company’s existing ABL. As of August
31, 2019, the combined borrowing base availability under the
Company’s ABL and Term Loan was $16.3 million.
The Company ended the quarter with $30.9 million of inventory on
hand compared to $31.9 million at the end of the comparable prior
year period. Average ending inventory per boutique was flat at
$43,000 versus the comparable prior year period.
Conference Call Information
A conference call to discuss the second quarter fiscal year 2019
results is scheduled for September 10, 2019 at 8:30 a.m. ET. A live
webcast of the conference call will be available in the investor
relations section of the Company’s website, www.francescas.com. A
replay of the call will be available after the conclusion of the
call and remain available until September 17, 2019. To access the
telephone replay, listeners should dial 1-844-512-2921. The access
code for the replay is 13693991. A replay of the web cast will also
be available shortly after the conclusion of the call and will
remain on the website for ninety days.
Forward-Looking Statements
Certain statements in this release are “forward-looking
statements” made pursuant to the safe-harbor provisions of the
Private Securities Litigation Reform Act of 1995, as amended. Such
forward-looking statements reflect the Company’s current
expectations or beliefs concerning future events and are subject to
various risks and uncertainties that may cause actual results to
differ materially from those that are expected. These risks and
uncertainties include, but are not limited to, the following: the
risk that the Company may not be able to successfully execute its
turnaround plan; the risk that the Company may not be able to
successfully integrate its Interim Chief Executive Officer and
Chief Financial Officer, and attract and integrate a new Chief
Executive Officer; the risk that the Company may not be able to
identify suitably qualified and experienced candidates to add to
its Board of Directors; the risk that the Company cannot
anticipate, identify and respond quickly to changing fashion trends
and customer preferences or changes in consumer environment,
including changing expectations of service and experience in
boutiques and online, and evolve its business model; the Company’s
ability to attract a sufficient number of customers to its
boutiques or sell sufficient quantities of its merchandise through
its ecommerce website; the Company’s ability to successfully open,
close, refresh, and operate our boutiques each year; the Company’s
ability to efficiently source and distribute merchandise quantities
necessary to support its operations; risks related to the Company’s
ability to comply with the continued listing standards of the
Nasdaq Global Select Market; and the impact of potential tariff
increases or new tariffs. For additional information regarding
these and other risks and uncertainties that could cause actual
results to differ materially from those contained in the Company’s
forward-looking statements, please refer to “Risk Factors” in the
Company’s Annual Report on Form 10-K for the year
ended February 3, 2019 filed with the SEC
on May 3, 2019 and any risk factors contained in
subsequent quarterly and annual reports it files with the SEC.
The Company undertakes no obligation to publicly update or revise
any forward-looking statement.
Non-GAAP Information
This press release includes non-GAAP adjusted SG&A, adjusted
income from operations, adjusted income before income tax expense,
adjusted income tax (benefit) expense, adjusted net income, and
adjusted diluted earnings per share, each of which are non-GAAP
financial measures. The Company believes these non-GAAP financial
measures not only provides the Company’s management with comparable
financial data for internal financial analysis but also provides
meaningful supplemental information to investors. Specifically,
these non-GAAP financial measures allow investors to better
understand the performance of the business and facilitate a
meaningful evaluation of the Company’s second quarter fiscal year
2019 SG&A, income from operations, income before income tax
expense, income tax (benefit) expense, net income and diluted
earnings per share on a comparable basis with the Company’s second
quarter fiscal year 2018 results. These non-GAAP measures should be
considered a supplement to, and not as a substitute for or superior
to, financial measures calculated in accordance with GAAP.
About Francesca's Holdings Corporation
francesca's® is a specialty retailer which operates a
nationwide-chain of boutiques providing customers a unique, fun and
personalized shopping experience. The merchandise assortment is a
diverse and balanced mix of apparel, jewelry, accessories and
gifts. As of September 10, 2019, francesca's® operated
approximately 719 boutiques in 47 states throughout the United
States and the District of Columbia and also serves its customers
through francescas.com. For additional information on
francesca's®, please visit www.francescas.com.
CONTACT: |
|
|
ICR, Inc.Jean Fontana646-277-1214 |
|
CompanyCindy Thomassee 832-494-2240Kate Venturina 713-864-1358 ext.
1145IR@francescas.com |
|
|
|
Francesca’s Holdings
CorporationConsolidated Statements of
Operations(In Thousands, Except Per Share Amounts,
Percentages and Basis Points)
|
Thirteen Weeks Ended |
|
|
|
|
|
|
|
August 3, 2019 |
|
August 4, 2018 |
|
Variance |
|
In USD |
|
As a % of Net Sales(1) |
|
In USD |
|
As a % of Net Sales(1) |
|
In USD |
|
% |
|
Basis Points |
Net sales |
$ |
105,972 |
|
|
100.0 |
% |
|
$ |
113,025 |
|
|
100.0 |
% |
|
$ |
(7,053 |
) |
|
(6 |
)% |
|
- |
|
Cost of goods sold and
occupancy costs |
|
65,469 |
|
|
61.8 |
% |
|
|
68,918 |
|
|
61.0 |
% |
|
|
(3,449 |
) |
|
(5 |
)% |
|
80 |
|
Gross profit |
|
40,503 |
|
|
38.2 |
% |
|
|
44,107 |
|
|
39.0 |
% |
|
|
(3,604 |
) |
|
(8 |
)% |
|
(80 |
) |
Selling, general and
administrative expenses |
|
39,124 |
|
|
36.9 |
% |
|
|
43,277 |
|
|
38.3 |
% |
|
|
(4,153 |
) |
|
(10 |
)% |
|
(140 |
) |
Income from operations |
|
1,379 |
|
|
1.3 |
% |
|
|
830 |
|
|
0.7 |
% |
|
|
549 |
|
|
66 |
% |
|
60 |
|
Interest expense |
|
152 |
|
|
0.1 |
% |
|
|
112 |
|
|
0.1 |
% |
|
|
40 |
|
|
36 |
% |
|
- |
|
Other income |
|
259 |
|
|
0.2 |
% |
|
|
102 |
|
|
0.1 |
% |
|
|
157 |
|
|
154 |
% |
|
10 |
|
Income before income tax
expense |
|
1,486 |
|
|
1.4 |
% |
|
|
820 |
|
|
0.7 |
% |
|
|
666 |
|
|
81 |
% |
|
70 |
|
Income tax (benefit)
expense |
|
(326 |
) |
|
(0.3 |
)% |
|
|
366 |
|
|
0.3 |
% |
|
|
(692 |
) |
|
(189 |
)% |
|
(60 |
) |
Net income |
$ |
1,812 |
|
|
1.7 |
% |
|
$ |
454 |
|
|
0.4 |
% |
|
$ |
1,358 |
|
|
299 |
% |
|
130 |
|
(1)
Percentage totals or differences in the above table may not
equal the sum or difference of the components due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share* |
$ |
0.61 |
|
|
|
|
$ |
0.16 |
|
|
|
|
|
|
|
|
|
Weighted average diluted share
count* |
|
2,960 |
|
|
|
|
|
2,918 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable sales change |
(5)% |
|
(13)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twenty-Six Weeks Ended |
|
|
|
|
|
|
|
August 3, 2019 |
|
August 4, 2018 |
|
Variance |
|
In USD |
|
As a % of Net Sales(1) |
|
In USD |
|
As a % of Net Sales(1) |
|
In USD |
|
% |
|
Basis Points |
Net sales |
$ |
193,097 |
|
|
100.0 |
% |
|
$ |
213,430 |
|
|
100.0 |
% |
|
$ |
(20,333 |
) |
|
(10 |
)% |
|
- |
|
Cost of goods sold and
occupancy costs |
|
122,267 |
|
|
63.3 |
% |
|
|
130,960 |
|
|
61.4 |
% |
|
|
(8,693 |
) |
|
(7 |
)% |
|
200 |
|
Gross profit |
|
70,830 |
|
|
36.7 |
% |
|
|
82,470 |
|
|
38.6 |
% |
|
|
(11,640 |
) |
|
(14 |
)% |
|
(200 |
) |
Selling, general and
administrative expenses |
|
79,118 |
|
|
41.0 |
% |
|
|
86,160 |
|
|
40.4 |
% |
|
|
(7,042 |
) |
|
(8 |
)% |
|
60 |
|
Loss from operations |
|
(8,288 |
) |
|
(4.3 |
)% |
|
|
(3,690 |
) |
|
(1.7 |
)% |
|
|
4,598 |
|
|
125 |
% |
|
260 |
|
Interest expense |
|
325 |
|
|
0.2 |
% |
|
|
229 |
|
|
0.1 |
% |
|
|
96 |
|
|
42 |
% |
|
10 |
|
Other income |
|
372 |
|
|
0.2 |
% |
|
|
252 |
|
|
0.1 |
% |
|
|
120 |
|
|
48 |
% |
|
10 |
|
Loss before income tax expense
(benefit) |
|
(8,241 |
) |
|
(4.3 |
)% |
|
|
(3,667 |
) |
|
(1.7 |
)% |
|
|
4,574 |
|
|
125 |
% |
|
250 |
|
Income tax expense
(benefit) |
|
96 |
|
|
0.0 |
% |
|
|
(236 |
) |
|
(0.1 |
)% |
|
|
332 |
|
|
141 |
% |
|
20 |
|
Net loss |
$ |
(8,337 |
) |
|
(4.3 |
)% |
|
$ |
(3,431 |
) |
|
(1.6 |
)% |
|
$ |
4,906 |
|
|
143 |
% |
|
270 |
|
(1)
Percentage totals or differences in the above table may not
equal the sum or difference of the components due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share* |
$ |
(2.87 |
) |
|
|
|
$ |
(1.18 |
) |
|
|
|
|
|
|
|
|
Weighted average diluted share
count* |
|
2,904 |
|
|
|
|
|
2,901 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable sales change |
(9)% |
|
(15)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*Reflects the 12-to-1 reverse stock split that became effective
on July 1, 2019.
Francesca’s Holdings
CorporationConsolidated Balance
Sheets(In thousands, except share and per share
amounts)
|
August 3, 2019 |
|
|
February 2, 2019 |
|
|
August 4, 2018 |
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
21,962 |
|
|
$ |
20,103 |
|
|
$ |
23,354 |
|
Accounts receivable |
|
7,987 |
|
|
|
16,309 |
|
|
|
19,764 |
|
Inventories |
|
30,942 |
|
|
|
30,478 |
|
|
|
31,902 |
|
Prepaid expenses and other current assets |
|
10,759 |
|
|
|
10,357 |
|
|
|
10,549 |
|
Total current assets |
|
71,650 |
|
|
|
77,247 |
|
|
|
85,569 |
|
Operating lease right-of-use
assets, net |
|
230,295 |
|
|
|
- |
|
|
|
- |
|
Property and equipment,
net |
|
61,874 |
|
|
|
71,207 |
|
|
|
89,858 |
|
Deferred income taxes |
|
- |
|
|
|
- |
|
|
|
7,233 |
|
Other assets, net |
|
4,197 |
|
|
|
4,588 |
|
|
|
4,912 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
ASSETS |
$ |
368,016 |
|
|
$ |
153,042 |
|
|
$ |
187,572 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
|
|
|
Accounts payable |
$ |
18,773 |
|
|
$ |
24,330 |
|
|
$ |
29,406 |
|
Accrued liabilities |
|
12,398 |
|
|
|
11,333 |
|
|
|
11,926 |
|
Operating lease liabilities |
|
49,937 |
|
|
|
- |
|
|
|
- |
|
Total current liabilities |
|
81,108 |
|
|
|
35,663 |
|
|
|
41,332 |
|
Operating lease
liabilities |
|
213,870 |
|
|
|
- |
|
|
|
- |
|
Landlord incentives and
deferred rent |
|
- |
|
|
|
33,989 |
|
|
|
35,904 |
|
Long-term debt |
|
10,000 |
|
|
|
10,000 |
|
|
|
- |
|
Other liabilities |
|
61 |
|
|
|
- |
|
|
|
- |
|
Total liabilities |
|
305,039 |
|
|
|
79,652 |
|
|
|
77,236 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
|
|
|
Common stock – $0.01 par value, 80.0 million shares
authorized; 4.0 million, 3.9 million and 3.9 million issued at
August 3, 2019, February 2, 2019 and August 4, 2018* |
|
40 |
|
|
|
39 |
|
|
|
40 |
|
Additional paid-in capital |
|
112,869 |
|
|
|
113,121 |
|
|
|
112,569 |
|
Retained earnings |
|
110,089 |
|
|
|
120,251 |
|
|
|
157,748 |
|
Treasury stock, at cost – 0.9 million shares at each of August 3,
2019, February 2, 2019 and August 4, 2018* |
|
(160,021 |
) |
|
|
(160,021 |
) |
|
|
(160,021 |
) |
Total stockholders’
equity |
|
62,977 |
|
|
|
73,390 |
|
|
|
110,336 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY |
$ |
368,016 |
|
|
$ |
153,042 |
|
|
$ |
187,572 |
|
|
|
|
|
|
|
|
|
|
|
|
|
*Reflects the 12-to-1 reverse stock split that became effective
on July 1, 2019.
Francesca’s Holdings
CorporationConsolidated Statements of Cash
Flows(In thousands)
|
Twenty-Six Weeks Ended |
|
|
August 3, 2019 |
|
|
August 4, 2018 |
|
Cash Flows Provided by Operating Activities: |
|
|
|
|
|
|
|
Net loss |
$ |
(8,337 |
) |
|
$ |
(3,431 |
) |
Adjustments to reconcile net loss to net cash provided by operating
activities: |
|
|
|
|
|
|
|
Depreciation and amortization |
|
11,320 |
|
|
|
12,105 |
|
Stock-based compensation expense |
|
(190 |
) |
|
|
733 |
|
Loss on sale of assets |
|
99 |
|
|
|
350 |
|
Impairment charges |
|
189 |
|
|
|
148 |
|
Deferred income taxes |
|
- |
|
|
|
1,473 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
Accounts receivable |
|
8,322 |
|
|
|
(3,122 |
) |
Inventories |
|
(464 |
) |
|
|
(5,086 |
) |
Prepaid expenses and other assets |
|
(373 |
) |
|
|
(2,411 |
) |
Accounts payable |
|
(3,765 |
) |
|
|
12,590 |
|
Accrued liabilities |
|
1,064 |
|
|
|
20 |
|
Operating lease right-of-use assets and lease liabilities, net |
|
(2,490 |
) |
|
|
- |
|
Landlord incentives and deferred rent |
|
- |
|
|
|
(2,433 |
) |
Net cash provided by operating
activities |
|
5,375 |
|
|
|
10,936 |
|
|
|
|
|
|
|
|
|
Cash Flows Used in Investing
Activities: |
|
|
|
|
|
|
|
Purchases of property and equipment |
|
(3,372 |
) |
|
|
(14,436 |
) |
Net cash used in investing
activities |
|
(3,372 |
) |
|
|
(14,436 |
) |
|
|
|
|
|
|
|
|
Cash Flows Used in Financing
Activities: |
|
|
|
|
|
|
|
Proceeds from borrowings under the revolving credit facility |
|
5,000 |
|
|
|
- |
|
Repayments of borrowings under the revolving credit facility |
|
(5,000 |
) |
|
|
- |
|
Payment of debt issuance costs |
|
(144 |
) |
|
|
(471 |
) |
Taxes paid related to net settlement of equity awards |
|
- |
|
|
|
(26 |
) |
Repurchases of common stock |
|
- |
|
|
|
(3,980 |
) |
Net cash used in financing
activities |
|
(144 |
) |
|
|
(4,477 |
) |
|
|
|
|
|
|
|
|
Net increase (decrease) in
cash and cash equivalents |
|
1,859 |
|
|
|
(7,977 |
) |
Cash and cash equivalents,
beginning of year |
|
20,103 |
|
|
|
31,331 |
|
Cash and cash
equivalents, end of period |
$ |
21,962 |
|
|
$ |
23,354 |
|
|
|
|
|
|
|
|
|
Supplemental
Disclosures of Cash Flow Information: |
|
|
|
|
|
|
|
Cash (received) paid for income taxes |
$ |
(8,601 |
) |
|
$ |
226 |
|
Interest paid |
$ |
330 |
|
|
$ |
77 |
|
|
|
|
|
|
|
|
|
Francesca’s Holdings
CorporationSupplemental Information
Quarterly Sales by Merchandise Category
|
Thirteen Weeks Ended |
|
|
|
August 3, 2019 |
|
August 4, 2018 |
|
Variance |
|
In USD |
|
As a % of Sales |
|
|
In USD |
|
As a % of Sales |
|
In Dollars |
|
% |
|
(in
thousands, except percentages) |
Apparel |
52,389 |
|
49.4 |
% |
|
|
56,807 |
|
50.3 |
% |
|
|
(4,418 |
) |
|
(8 |
)% |
Jewelry |
27,957 |
|
26.4 |
% |
|
|
26,984 |
|
23.9 |
% |
|
|
973 |
|
|
4 |
% |
Accessories |
16,211 |
|
15.3 |
% |
|
|
17,181 |
|
15.2 |
% |
|
|
(970 |
) |
|
(6 |
)% |
Gifts |
8,532 |
|
8.1 |
% |
|
|
11,337 |
|
10.0 |
% |
|
|
(2,805 |
) |
|
(25 |
)% |
Others(1) |
883 |
|
0.8 |
% |
|
|
716 |
|
0.6 |
% |
|
|
167 |
|
|
23 |
% |
Net sales |
105,972 |
|
100.0 |
% |
|
|
113,025 |
|
100.0 |
% |
|
|
(7,053 |
) |
|
(6 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes gift card
breakage income, shipping and change in return reserve.
Quarterly Comparable Sales
|
FY 2019 |
|
FY 2018 |
|
FY 2017 |
Q1 |
(13 |
)% |
|
(16 |
)% |
|
(5 |
)% |
Q2 |
(5 |
)% |
|
(13 |
)% |
|
(3 |
)% |
Q3 |
|
|
(14 |
)% |
|
(18 |
)% |
Q4 |
|
|
(14 |
)% |
|
(15 |
)% |
Fiscal year |
|
|
(14 |
)% |
|
(11 |
)% |
|
|
|
|
|
|
|
|
Boutique Count
|
Twenty-SixWeeks Ended |
|
Fiscal Year Ended |
|
Twenty-Six Weeks Ended |
|
|
August 3, 2019 |
|
February 2, 2019 |
|
August 4, 2018 |
|
Number of boutiques open at the
beginning of period period |
727 |
|
721 |
|
721 |
|
Boutiques opened |
4 |
|
32 |
|
31 |
|
Boutiques closed |
(13 |
) |
(26 |
) |
(10 |
) |
Number of boutiques open at the
end of period |
718 |
|
727 |
|
742 |
|
|
|
|
|
|
|
|
Francesca’s Holdings CorporationGAAP to
Non-GAAP Reconciliation(In Thousands, Except Per
Share Amounts and Percentages)Thirteen Weeks Ended
August 3, 2019
|
As Reported(GAAP) |
|
Other Payroll Costs (1) |
Professional Fees (2) |
|
Reversal of Stock-based Compensation (3) |
|
Adjusted(Non-GAAP) |
SG&A |
$ |
39,124 |
|
|
$ |
(451 |
) |
$ |
(242 |
) |
|
$ |
276 |
|
|
$ |
38,707 |
|
Income from operations |
|
1,379 |
|
|
|
451 |
|
|
242 |
|
|
|
(276 |
) |
|
|
1,796 |
|
Income before income tax |
|
1,486 |
|
|
|
451 |
|
|
242 |
|
|
|
(276 |
) |
|
|
1,903 |
|
Income tax (benefit) expense
(4) |
|
(326 |
) |
|
|
99 |
|
|
53 |
|
|
|
(61 |
) |
|
|
(235 |
) |
Net income |
|
1,812 |
|
|
|
352 |
|
|
189 |
|
|
|
(215 |
) |
|
|
2,138 |
|
Diluted earnings per share
(5) |
|
0.61 |
|
|
|
0.12 |
|
|
0.06 |
|
|
|
(0.07 |
) |
|
|
0.72 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Consists of other payroll costs associated with the Company’s
turnaround plan.
- Consists of professional expenses incurred in connection with
the Company’s previously disclosed reverse stock split and adoption
of a stockholder rights plan.
- Consists of stock-based compensation reversal associated with
the departure of the Company’s former Chief Financial Officer.
- The income tax impact of each adjustment was calculated using
the effective income tax rate of 22% during the thirteen weeks
ended August 3, 2019.
- The diluted earnings per share impact of each adjustment was
calculated by dividing the net loss impact by the diluted share
count of 2,960,000, which reflects the 12-to-1 reverse stock split
that became effective on July 1, 2019.
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