Leslie’s, Inc. (“Leslie’s”, “we”, “our” or “its”; NASDAQ: LESL),
the largest and most trusted direct-to-consumer brand in the U.S.
pool and spa care industry, today announced its financial results
for the fourth quarter and Fiscal 2023.
Mike Egeck, Chief Executive Officer said,
“Following three years of unprecedented growth, the pool industry
and Leslie’s faced multiple transitory headwinds in 2023 that
impacted our financial results through the fiscal fourth quarter.
Despite these impacts, we continued to deliver exceptional service
to our customers. In 2023, brand awareness, in stock service levels
and corresponding net promoter scores were at all-time highs. In
addition, our Pool Perks® loyalty program grew, customer lifetime
value increased and we continued to gain market share, all of which
are a testament to the focus and execution of our team
members.”
Mr. Egeck continued, “Looking forward, the
fundamental advantages of the after-market pool-care industry
remain intact, as do our competitive advantages. Leslie’s remains
the largest specialty retailer in the industry with unmatched
capabilities and clear long-term growth opportunities, which along
with our focus on executing against our strategic initiatives,
position us to drive financial performance and create shareholder
value as industry conditions normalize.”
Fourth Quarter Highlights
- Sales decreased 9.1% to $432.4 million compared to $475.6
million in the prior year period. Comparable sales decreased 11.0%
compared to the prior year period. Non-comparable sales including
acquisitions and new stores contributed $8.8 million in sales for
the period.
- Gross profit decreased 26.3% to $160.2 million from $217.2
million in the prior year period. Gross margin was 37.0% compared
to 45.7% in the prior year period. The decrease in gross profit was
driven by the full quarter impact of decreased retail chemical
pricing actions taken in June 2023, adjustments associated with
year-end physical inventory count results, expensing of capitalized
distribution costs associated with the reduction of inventory,
lower product rebates, and occupancy deleverage associated with the
decrease in comparable sales.
- Selling, general and administrative expenses (“SG&A”)
decreased 9.3% to $121.6 million from $134.1 million in the prior
year period, driven by lower sales, expense management actions and
lower performance compensation, partially offset by costs incurred
from the discontinued use of certain software subscriptions and
executive transition costs associated with restructuring
actions.
- Operating income was $38.5 million compared to $83.1 million in
the prior year period.
- Interest expense increased $7.6 million to $17.2 million from
$9.6 million in the prior year period primarily due to higher
effective interest rates.
- Net income was $16.5 million compared to $57.9 million in the
prior year period.
- Adjusted net income was $25.7 million compared to $64.4 million
in the prior year period.
- Diluted earnings per share was $0.09 compared to $0.31 in the
prior year period. Adjusted diluted earnings per share was $0.14
compared to $0.35 in the prior year period.
- Adjusted EBITDA was $59.5 million compared to $99.5 million in
the prior year period.
Fiscal 2023 Highlights
- Sales decreased 7.1% to $1,451.2 million compared to $1,562.1
million in the prior year. Comparable sales decreased 11.0%.
Non-comparable sales including acquisitions and new stores
contributed $59.6 million for the year.
- Gross profit decreased 18.6% to $548.2 million compared to
$673.7 million in the prior year. Gross margin decreased to 37.8%
from 43.1% in the prior year. The decrease in gross margin was
primarily driven by decreased retail chemical pricing actions taken
in June 2023, inventory adjustments associated with year-end
physical inventory results, elevated distribution costs, lower
product rebates, and occupancy deleverage associated with the
decrease in comparable sales.
- SG&A increased $11.0 million to $446.0 million compared to
$435.0 million in the prior year due to costs incurred from the
discontinued use of certain software subscriptions, executive
transition costs associated with our restructuring, and
non-comparable expense from acquisitions and new stores.
- Operating income was $102.2 million compared to $238.8 million
in the prior year.
- Interest expense increased $35.2 million to $65.4 million from
$30.2 million in the prior year.
- Net income was $27.2 million compared to $159.0 million in the
prior year.
- Adjusted net income was $51.1 million compared to $176.4
million in the prior year.
- Diluted earnings per share was $0.15 compared to $0.85 in the
prior year. Adjusted diluted earnings per share was $0.28 compared
to $0.95 in the prior year.
- Adjusted EBITDA was $168.1 million compared to $292.3 million
in the prior year.
Balance Sheet and Cash Flow
Highlights
- Cash and cash equivalents totaled $55.4 million as of September
30, 2023 compared to $112.3 million as of October 1, 2022, a
decrease of $56.9 million primarily due to lower net income.
- Inventories as of September 30, 2023 decreased 13.8% to $311.8
million compared to $361.7 million as of October 1, 2022.
- Funded debt on our term loan was $789.8 million as of September
30, 2023 compared to $797.9 million as of October 1, 2022. As of
September 30, 2023, we had no borrowings and availability of $238.6
million under our revolving credit facility.
- The effective rate on our term loan during the fourth quarter
of Fiscal 2023 was 8.1% compared to 4.3% during the fourth quarter
of Fiscal 2022.
- Net cash provided by operating activities was $6.5 million in
Fiscal 2023 compared to $66.6 million in Fiscal 2022.
- Capital expenditures were $38.6 million in Fiscal 2023 compared
to $31.7 million in Fiscal 2022.
- Net cash used for business acquisitions was $15.5 million in
Fiscal 2023 compared to $107.7 million in Fiscal 2022.
- As of September 30, 2023, approximately $147.7 million remained
available for future share repurchases under the Company’s existing
share repurchase program.
Fiscal 2024 Outlook
The Company expects the following for Fiscal
2024:
Sales |
$1,410 to $1,470 million |
Gross
profit |
$550 to
$573 million |
Net
income |
$32 to $46
million |
Adjusted net
income |
$46 to $60
million |
Adjusted
EBITDA |
$170 to
$190 million |
Adjusted
diluted earnings per share |
$0.25 to
$0.33 |
Diluted
weighted average shares outstanding |
185
million |
*Note: A reconciliation of non-GAAP guidance
measures to corresponding GAAP measures is not available on a
forward-looking basis without unreasonable effort due to the
uncertainty of expenses that may be incurred in the future,
although it is important to note that these factors could be
material to our results computed in accordance with GAAP.
Conference Call Details
A conference call to discuss the Company’s
financial results for the fourth quarter and Fiscal 2023 is
scheduled for today, Tuesday, November 28, 2023 at 4:30 p.m.
Eastern Time. Investors and analysts interested in participating in
the call are invited to dial 877-407-0784 (international callers
please dial 1-201-689-8560) approximately 10 minutes prior to the
start of the call. A live audio webcast of the conference call will
be available online at https://ir.lesliespool.com/.
A recorded replay of the conference call will be
available within approximately three hours of the conclusion of the
call and can be accessed, along with the associated slides, online
at https://ir.lesliespool.com/ for 90 days.
About Leslie’s
Founded in 1963, Leslie’s is the largest and most
trusted direct-to-consumer brand in the U.S. pool and spa care
industry. The Company serves the aftermarket needs of residential
and professional consumers with an extensive and largely exclusive
assortment of essential pool and spa care products. The Company
operates an integrated ecosystem of over 1,000 physical locations
and a robust digital platform, enabling consumers to engage with
Leslie’s whenever, wherever, and however they prefer to shop. Its
dedicated team of associates, pool and spa care experts, and
experienced service technicians are passionate about empowering
Leslie’s consumers with the knowledge, products, and solutions
necessary to confidently maintain and enjoy their pools and
spas.
Use of Non-GAAP Financial Measures and
Other Operating Measures
In addition to reporting financial results in
accordance with accounting principles generally accepted in the
United States (“GAAP”), we use certain non-GAAP financial measures
and other operating measures, including comparable sales growth,
Adjusted EBITDA, Adjusted net income (loss), and Adjusted earnings
per share, to evaluate the effectiveness of our business
strategies, to make budgeting decisions, and to compare our
performance against that of other peer companies using similar
measures. These non-GAAP financial measures and other operating
measures should not be considered in isolation or as substitutes
for our results as reported under GAAP. In addition, these non-GAAP
financial measures and other operating measures are not calculated
in the same manner by all companies, and accordingly, are not
necessarily comparable to similarly titled measures of other
companies and may not be appropriate measures for performance
relative to other companies.
Comparable Sales Growth
We measure comparable sales growth as the increase
or decrease in sales recorded by the comparable base in any
reporting period, compared to sales recorded by the comparable base
in the prior reporting period. The comparable base includes sales
through our locations and through our e-commerce websites and
third-party marketplaces. Comparable sales growth is a key measure
used by management and our board of directors to assess our
financial performance.
Adjusted EBITDA
Adjusted EBITDA is defined as earnings before
interest (including amortization of debt issuance costs), taxes,
depreciation and amortization, management fees, equity-based
compensation expense, loss (gain) on debt extinguishment, loss
(gain) on asset and contract dispositions, executive transition
costs, severance, costs related to equity offerings, strategic
project costs, merger and acquisition costs, and other
non-recurring, non-cash or discrete items. Adjusted EBITDA is a key
measure used by management and our board of directors to assess our
financial performance. Adjusted EBITDA is also frequently used by
analysts, investors, and other interested parties to evaluate
companies in our industry, when considered alongside other GAAP
measures. We use Adjusted EBITDA to supplement GAAP measures of
performance to evaluate the effectiveness of our business
strategies, to make budgeting decisions, and to compare our
performance against that of other companies using similar
measures.
Adjusted EBITDA is not a recognized measure of
financial performance under GAAP but is used by some investors to
determine a company’s ability to service or incur indebtedness.
Adjusted EBITDA is not calculated in the same manner by all
companies, and accordingly, is not necessarily comparable to
similarly titled measures of other companies and may not be an
appropriate measure for performance relative to other companies.
Adjusted EBITDA should not be construed as an indicator of a
company’s operating performance in isolation from, or as a
substitute for, net income (loss), cash flows from operations or
cash flow data, all of which are prepared in accordance with GAAP.
We have presented Adjusted EBITDA solely as supplemental disclosure
because we believe it allows for a more complete analysis of
results of operations. Adjusted EBITDA is not intended to
represent, and should not be considered more meaningful than, or as
an alternative to, measures of operating performance as determined
in accordance with GAAP. In the future, we may incur expenses or
charges such as those added back to calculate Adjusted EBITDA. Our
presentation of Adjusted EBITDA should not be construed as an
inference that our future results will be unaffected by these
items.
Adjusted Net Income (Loss) and Adjusted Earnings
per Share
Adjusted net income (loss) and Adjusted earnings
per share are additional key measures used by management and our
board of directors to assess our financial performance. Adjusted
net income (loss) and Adjusted earnings per share are also
frequently used by analysts, investors, and other interested
parties to evaluate companies in our industry, when considered
alongside other GAAP measures.
Adjusted net income (loss) is defined as net
income (loss) adjusted to exclude management fees, equity-based
compensation expense, loss (gain) on debt extinguishment, loss
(gain) on asset and contract dispositions, executive transition
costs, severance, costs related to equity offerings, strategic
project costs, merger and acquisition costs, and other
non-recurring, non-cash, or discrete items. Adjusted diluted
earnings per share is defined as Adjusted net income (loss) divided
by the diluted weighted average number of common shares
outstanding.
Forward-Looking Statements
This press release contains forward-looking
statements about us and our industry that involve substantial risks
and uncertainties. All statements other than statements of
historical fact contained in this press release, including
statements regarding our future results of operations or financial
condition, business strategy, legal proceedings, competitive
advantages, market size, growth opportunities, industry
expectations, and plans and objectives of management for future
operations, are forward-looking statements. In some cases, you can
identify forward-looking statements because they contain words such
as “anticipate,” “believe,” “contemplate,” “continue,” “could,”
“estimate,” “expect,” “intend,” “may,” “plan,” “potential,”
“predict,” “project,” “should,” “target,” “will,” or “would,” or
the negative of these words or other similar terms or expressions.
Our actual results or outcomes could differ materially from those
indicated in these forward-looking statements for a variety of
reasons, including, among others:
- our ability to execute on our growth strategies;
- supply disruptions;
- our ability to maintain favorable relationships with suppliers
and manufacturers;
- competition from mass merchants and specialty retailers;
- impacts on our business from the sensitivity of our business to
weather conditions, changes in the economy (including rising
interest rates, recession fears, and inflationary pressures),
geopolitical events or conflicts, and the housing market;
- disruptions in the operations of our distribution centers;
- our ability to implement technology initiatives that deliver
the anticipated benefits, without disrupting our operations;
- our ability to attract and retain senior management and other
qualified personnel;
- regulatory changes and development affecting our current and
future products, including evolving legal standards and regulations
concerning environmental, social and governance (“ESG”)
matters;
- our ability to obtain additional capital to finance
operations;
- commodity price inflation and deflation;
- impacts on our business from epidemics, pandemics, or natural
disasters;
- impacts on our business from cyber incidents and other security
threats or disruptions;
- our ability to remediate material weaknesses or other
deficiencies in our internal control over financial reporting or to
maintain effective disclosure controls and procedures and internal
control over financial reporting; and
- other risks and uncertainties, including those listed in the
section titled “Risk Factors” in our filings with the United States
Securities and Exchange Commission (“SEC”).
You should not rely on forward-looking statements
as predictions of future events. We have based the forward-looking
statements contained in this press release primarily on our current
expectations and projections about future events and trends that we
believe may affect our business, financial condition, and operating
results. The outcome of the events described in these
forward-looking statements is subject to risks, uncertainties, and
other factors described above and in our filings with the SEC.
Moreover, we operate in a very competitive and rapidly changing
environment. New risks and uncertainties emerge from time-to-time,
and it is not possible for us to predict all risks and
uncertainties that could have an impact on the forward-looking
statements contained in this press release. The results, events,
and circumstances reflected in the forward-looking statements may
not be achieved or occur, and actual results or outcomes could
differ materially from those described in the forward-looking
statements.
In addition, statements that “we believe” and
similar statements reflect our beliefs and opinions on the relevant
subject. These statements are based on information available to us
as of the date of this press release, and while we believe that
information provides a reasonable basis for these statements, that
information may be limited or incomplete. Our statements should not
be read to indicate that we have conducted an exhaustive inquiry
into, or review of, all relevant information. These statements are
inherently uncertain, and investors are cautioned not to unduly
rely on these statements.
The forward-looking statements made in this press
release are based on events or circumstances as of the date on
which the statements are made. We undertake no obligation to update
any forward-looking statements made in this press release to
reflect events or circumstances after the date of this press
release or to reflect new information, changed expectations, the
occurrence of unanticipated events or otherwise, except as required
by law. We may not actually achieve the plans, intentions, outcomes
or expectations disclosed in our forward-looking statements, and
you should not place undue reliance on our forward-looking
statements. Our forward-looking statements do not reflect the
potential impact of any future acquisitions, mergers, dispositions,
joint ventures, or investments.
Contact Investors Farah
Soi/Caitlin Churchill ICR investorrelations@lesl.com
|
|
Condensed Consolidated Statements of Operations
(Amounts in thousands, except per share
amounts) |
|
|
|
|
|
Three Months Ended |
|
|
Year Ended |
|
|
|
September 30, 2023 |
|
|
October 1, 2022 |
|
|
September 30, 2023 |
|
|
October 1, 2022 |
|
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Unaudited) |
|
|
(Audited) |
|
Sales |
|
$ |
432,370 |
|
|
$ |
475,591 |
|
|
$ |
1,451,209 |
|
|
$ |
1,562,120 |
|
Cost of merchandise and services sold |
|
|
272,209 |
|
|
|
258,402 |
|
|
|
902,986 |
|
|
|
888,379 |
|
Gross profit |
|
|
160,161 |
|
|
|
217,189 |
|
|
|
548,223 |
|
|
|
673,741 |
|
Selling, general and administrative expenses |
|
|
121,617 |
|
|
|
134,115 |
|
|
|
446,044 |
|
|
|
434,987 |
|
Operating income |
|
|
38,544 |
|
|
|
83,074 |
|
|
|
102,179 |
|
|
|
238,754 |
|
Other expense: |
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
17,156 |
|
|
|
9,581 |
|
|
|
65,438 |
|
|
|
30,240 |
|
Other (income) expenses, net |
|
|
— |
|
|
|
(10 |
) |
|
|
— |
|
|
|
397 |
|
Total other expense |
|
|
17,156 |
|
|
|
9,571 |
|
|
|
65,438 |
|
|
|
30,637 |
|
Income before taxes |
|
|
21,388 |
|
|
|
73,503 |
|
|
|
36,741 |
|
|
|
208,117 |
|
Income tax expense |
|
|
4,907 |
|
|
|
15,569 |
|
|
|
9,499 |
|
|
|
49,088 |
|
Net income |
|
$ |
16,481 |
|
|
$ |
57,934 |
|
|
$ |
27,242 |
|
|
$ |
159,029 |
|
Earnings per share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.09 |
|
|
$ |
0.32 |
|
|
$ |
0.15 |
|
|
$ |
0.86 |
|
Diluted |
|
$ |
0.09 |
|
|
$ |
0.31 |
|
|
$ |
0.15 |
|
|
$ |
0.85 |
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
184,181 |
|
|
|
183,267 |
|
|
|
183,839 |
|
|
|
184,347 |
|
Diluted |
|
|
184,782 |
|
|
|
184,688 |
|
|
|
184,716 |
|
|
|
186,148 |
|
|
|
Other Financial Data (1)
(Amounts in thousands, except per share amounts)
(Unaudited) |
|
|
|
|
|
Three Months Ended |
|
|
Year Ended |
|
|
|
September 30, 2023 |
|
|
October 1, 2022 |
|
|
September 30, 2023 |
|
|
October 1, 2022 |
|
Adjusted EBITDA |
|
$ |
59,466 |
|
|
$ |
99,542 |
|
|
$ |
168,149 |
|
|
$ |
292,276 |
|
Adjusted net income |
|
$ |
25,743 |
|
|
$ |
64,360 |
|
|
$ |
51,113 |
|
|
$ |
176,391 |
|
Adjusted diluted earnings per share |
|
$ |
0.14 |
|
|
$ |
0.35 |
|
|
$ |
0.28 |
|
|
$ |
0.95 |
|
(1) See section titled “GAAP to
Non-GAAP Reconciliation.”
|
|
Condensed Consolidated Balance Sheets
(Amounts in thousands, except share and per share
amounts) |
|
|
|
|
|
September 30, 2023 |
|
|
October 1, 2022 |
|
Assets |
|
(Unaudited) |
|
|
(Audited) |
|
Current assets |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
55,420 |
|
|
$ |
112,293 |
|
Accounts and other receivables, net |
|
|
29,396 |
|
|
|
45,295 |
|
Inventories |
|
|
311,837 |
|
|
|
361,686 |
|
Prepaid expenses and other current assets |
|
|
23,633 |
|
|
|
23,104 |
|
Total current assets |
|
|
420,286 |
|
|
|
542,378 |
|
Property and equipment, net |
|
|
90,285 |
|
|
|
78,087 |
|
Operating lease right-of-use assets |
|
|
251,460 |
|
|
|
236,477 |
|
Goodwill and other intangibles, net |
|
|
218,855 |
|
|
|
213,701 |
|
Deferred tax assets |
|
|
7,598 |
|
|
|
1,268 |
|
Other assets |
|
|
45,951 |
|
|
|
37,720 |
|
Total assets |
|
$ |
1,034,435 |
|
|
$ |
1,109,631 |
|
Liabilities and stockholders’ deficit |
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
Accounts payable and accrued expenses |
|
$ |
149,154 |
|
|
$ |
266,972 |
|
Operating lease liabilities |
|
|
62,794 |
|
|
|
60,373 |
|
Income taxes payable |
|
|
5,782 |
|
|
|
12,511 |
|
Current portion of long-term debt |
|
|
8,100 |
|
|
|
8,100 |
|
Total current liabilities |
|
|
225,830 |
|
|
|
347,956 |
|
Operating lease liabilities, noncurrent |
|
|
193,222 |
|
|
|
179,835 |
|
Long-term debt, net |
|
|
773,276 |
|
|
|
779,726 |
|
Other long-term liabilities |
|
|
3,469 |
|
|
|
65 |
|
Total liabilities |
|
|
1,195,797 |
|
|
|
1,307,582 |
|
Commitments and contingencies |
|
|
|
|
|
|
Stockholders’ deficit |
|
|
|
|
|
|
Common stock, $0.001 par value, 1,000,000,000 shares authorized and
184,333,670 and 183,480,545 issued and outstanding as of September
30, 2023 and October 1, 2022, respectively. |
|
|
184 |
|
|
|
183 |
|
Additional paid in capital |
|
|
99,280 |
|
|
|
89,934 |
|
Retained deficit |
|
|
(260,826 |
) |
|
|
(288,068 |
) |
Total stockholders’ deficit |
|
|
(161,362 |
) |
|
|
(197,951 |
) |
Total liabilities and stockholders’ deficit |
|
$ |
1,034,435 |
|
|
$ |
1,109,631 |
|
|
|
Condensed Consolidated Statements of Cash Flows
(Amounts in thousands) |
|
|
|
|
|
Year Ended |
|
|
|
September 30, 2023 |
|
|
October 1, 2022 |
|
|
|
(Unaudited) |
|
|
(Audited) |
|
Operating Activities |
|
|
|
|
|
|
Net income |
|
$ |
27,242 |
|
|
$ |
159,029 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
|
34,142 |
|
|
|
30,769 |
|
Equity-based compensation |
|
|
11,703 |
|
|
|
11,346 |
|
Amortization of deferred financing costs and debt discounts |
|
|
2,100 |
|
|
|
1,982 |
|
Provision for doubtful accounts |
|
|
193 |
|
|
|
1,186 |
|
Deferred income taxes |
|
|
(6,330 |
) |
|
|
2,466 |
|
Loss on asset and contract dispositions |
|
|
6,396 |
|
|
|
466 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
Accounts and other receivables |
|
|
16,101 |
|
|
|
(7,621 |
) |
Inventories |
|
|
54,331 |
|
|
|
(143,147 |
) |
Prepaid expenses and other current assets |
|
|
(3,466 |
) |
|
|
(1,476 |
) |
Other assets |
|
|
(9,990 |
) |
|
|
(12,670 |
) |
Accounts payable and accrued expenses |
|
|
(120,048 |
) |
|
|
23,841 |
|
Income taxes payable |
|
|
(6,729 |
) |
|
|
5,566 |
|
Operating lease assets and liabilities, net |
|
|
825 |
|
|
|
(5,093 |
) |
Net cash provided by operating activities |
|
|
6,470 |
|
|
|
66,644 |
|
Investing Activities |
|
|
|
|
|
|
Purchases of property and equipment |
|
|
(38,577 |
) |
|
|
(31,726 |
) |
Business acquisitions, net of cash acquired |
|
|
(15,549 |
) |
|
|
(107,663 |
) |
Proceeds from asset dispositions |
|
|
1,587 |
|
|
|
408 |
|
Net cash used in investing activities |
|
|
(52,539 |
) |
|
|
(138,981 |
) |
Financing Activities |
|
|
|
|
|
|
Borrowings on Revolving Credit Facility |
|
|
264,000 |
|
|
|
45,000 |
|
Payments on Revolving Credit Facility |
|
|
(264,000 |
) |
|
|
(45,000 |
) |
Repayment of long-term debt |
|
|
(8,100 |
) |
|
|
(8,100 |
) |
Payment of deferred financing costs |
|
|
(347 |
) |
|
|
— |
|
Proceeds from options exercised |
|
|
— |
|
|
|
1,378 |
|
Repurchase and retirement of common stock |
|
|
— |
|
|
|
(152,146 |
) |
Payments of employee tax withholdings related to restricted stock
vesting |
|
|
(2,357 |
) |
|
|
— |
|
Net cash used in financing activities |
|
|
(10,804 |
) |
|
|
(158,868 |
) |
Net decrease in cash and cash equivalents |
|
|
(56,873 |
) |
|
|
(231,205 |
) |
Cash and cash equivalents, beginning of year |
|
|
112,293 |
|
|
|
343,498 |
|
Cash and cash equivalents, end of year |
|
$ |
55,420 |
|
|
$ |
112,293 |
|
Supplemental Information: |
|
|
|
|
|
|
Interest |
|
$ |
63,059 |
|
|
$ |
32,617 |
|
Income taxes, net of refunds received |
|
|
22,559 |
|
|
|
41,149 |
|
|
|
GAAP to Non-GAAP Reconciliation (Amounts
in thousands except per share amounts)
(Unaudited) |
|
|
|
|
|
Three Months Ended |
|
|
Year Ended |
|
|
|
September 30, 2023 |
|
|
October 1, 2022 |
|
|
September 30, 2023 |
|
|
October 1, 2022 |
|
Net income |
|
$ |
16,481 |
|
|
$ |
57,934 |
|
|
$ |
27,242 |
|
|
$ |
159,029 |
|
Interest expense |
|
|
17,156 |
|
|
|
9,581 |
|
|
|
65,438 |
|
|
|
30,240 |
|
Income tax expense |
|
|
4,907 |
|
|
|
15,569 |
|
|
|
9,499 |
|
|
|
49,088 |
|
Depreciation and amortization expense(1) |
|
|
8,573 |
|
|
|
7,889 |
|
|
|
34,142 |
|
|
|
30,769 |
|
Equity-based compensation expense(2) |
|
|
2,607 |
|
|
|
3,097 |
|
|
|
12,067 |
|
|
|
11,922 |
|
Loss on asset and contract dispositions(3) |
|
|
6,276 |
|
|
|
195 |
|
|
|
6,379 |
|
|
|
426 |
|
Executive transition costs(4) |
|
|
2,470 |
|
|
|
442 |
|
|
|
6,160 |
|
|
|
883 |
|
Costs related to equity offerings(5) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
550 |
|
Strategic project costs(6) |
|
|
241 |
|
|
|
532 |
|
|
|
3,004 |
|
|
|
4,960 |
|
Other non-recurring costs(7) |
|
|
755 |
|
|
|
4,303 |
|
|
|
4,218 |
|
|
|
4,409 |
|
Adjusted EBITDA |
|
$ |
59,466 |
|
|
$ |
99,542 |
|
|
$ |
168,149 |
|
|
$ |
292,276 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
Year Ended |
|
|
|
September 30, 2023 |
|
|
October 1, 2022 |
|
|
September 30, 2023 |
|
|
October 1, 2022 |
|
Net income |
|
$ |
16,481 |
|
|
$ |
57,934 |
|
|
$ |
27,242 |
|
|
$ |
159,029 |
|
Equity-based compensation expense(2) |
|
|
2,607 |
|
|
|
3,097 |
|
|
|
12,067 |
|
|
|
11,922 |
|
Loss on asset and contract dispositions (3) |
|
|
6,276 |
|
|
|
195 |
|
|
|
6,379 |
|
|
|
426 |
|
Executive transition costs (4) |
|
|
2,470 |
|
|
|
442 |
|
|
|
6,160 |
|
|
|
883 |
|
Costs related to equity offerings(5) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
550 |
|
Strategic project costs(6) |
|
|
241 |
|
|
|
532 |
|
|
|
3,004 |
|
|
|
4,960 |
|
Other non-recurring cost(7) |
|
|
755 |
|
|
|
4,303 |
|
|
|
4,218 |
|
|
|
4,409 |
|
Tax effects of these adjustments(8) |
|
|
(3,087 |
) |
|
|
(2,143 |
) |
|
|
(7,957 |
) |
|
|
(5,788 |
) |
Adjusted net income |
|
$ |
25,743 |
|
|
$ |
64,360 |
|
|
$ |
51,113 |
|
|
$ |
176,391 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share |
|
$ |
0.09 |
|
|
$ |
0.31 |
|
|
$ |
0.15 |
|
|
$ |
0.85 |
|
Adjusted diluted earnings per share |
|
$ |
0.14 |
|
|
$ |
0.35 |
|
|
$ |
0.28 |
|
|
$ |
0.95 |
|
Weighted average shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
184,181 |
|
|
|
183,267 |
|
|
|
183,839 |
|
|
|
184,347 |
|
Diluted |
|
|
184,782 |
|
|
|
184,688 |
|
|
|
184,716 |
|
|
|
186,148 |
|
(1) |
Includes depreciation related to our distribution centers and
locations, which is reported in cost of merchandise and services
sold in our consolidated statements of operations. |
(2) |
Represents charges related to equity-based compensation and the
related Company payroll tax expense, which are reported in SG&A
in our consolidated statements of operations. |
(3) |
Includes losses (gains) on asset and contract dispositions, which
are reported in SG&A in our consolidated statements of
operations. |
(4) |
Includes executive transition costs and severance associated with
corporate restructuring, which are reported in SG&A in our
consolidated statements of operations. |
(5) |
Includes costs incurred for follow-on equity offerings, which are
reported in other (income) expenses, net in our consolidated
statements of operations. |
(6) |
Represents non-recurring costs, such as third-party consulting
costs, which are not part of our ongoing operations and are
incurred to execute differentiated, strategic projects, and are
reported in SG&A in our consolidated statements of
operations. |
(7) |
Includes merger and acquisition costs, and other non-recurring,
non-cash, or discrete items as determined by management, which are
reported in SG&A in our consolidated statements of
operations. |
(8) |
Represents the tax effect of the total adjustments based on our
combined U.S. federal and state statutory tax rates. Amounts are
reported in income tax expense in our consolidated statements of
operations. |
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