RH Announces Repayment of $350 Million 0.00% Convertible Senior Notes Due 2019
June 17 2019 - 4:05PM
Business Wire
RH (NYSE:RH) today announced it has repaid the balance of its
$350 million in 0.00% Convertible Senior Notes due 2019 at
maturity. The Company used existing cash balances and borrowings
under its revolving credit facility to complete the repayment on
June 17, 2019 as expected.
CEO Gary Friedman commented, “Looking back, had we not been
opportunistic in responding to favorable market conditions through
our convertible notes financings in 2014 and 2015, we would not
have been in a position to repurchase $1 billion of our stock when
it was undervalued during 2017, which has proven to be an excellent
allocation of capital for the long-term benefit of our
shareholders. We are regularly evaluating various low interest rate
financing alternatives and expect to follow the same opportunistic
capital allocation approach in the future regarding both sources
and uses of capital.”
As previously reported, the Company continues to expect (i) to
repay its $300 million of 0.00% Convertible Senior Notes due 2020
at maturity in July, 2020 with internally generated cash as well as
borrowing under its existing credit facilities, and (ii) to end its
fiscal 2019 year with net debt to trailing twelve month Adjusted
EBITDA of approximately 2.0x.
ABOUT RH
RH (NYSE: RH) is a curator of design, taste and style in the
luxury lifestyle market. The Company offers its collections through
its retail galleries across North America, the Company’s multiple
Source Books, and online at RH.com, RHModern.com,
RHBabyandChild.com, RHTeen.com and Waterworks.com.
NON-GAAP FINANCIAL MEASURES
To supplement its condensed consolidated financial statements,
which are prepared and presented in accordance with Generally
Accepted Accounting Principles (“GAAP”), the Company uses various
non-GAAP financial measures including EBITDA and Adjusted EBITDA
(collectively, “non-GAAP financial measures”). We compute these
measures by adjusting the applicable GAAP measures to remove the
impact of certain recurring and non-recurring charges and gains and
the tax effect of these adjustments. The presentation of this
financial information is not intended to be considered in isolation
or as a substitute for, or superior to, the financial information
prepared and presented in accordance with GAAP. The Company uses
these non-GAAP financial measures for financial and operational
decision making and as a means to evaluate period-to-period
comparisons. The Company believes that they provide useful
information about operating results, enhance the overall
understanding of past financial performance and future prospects,
and allow for greater transparency with respect to key metrics used
by management in its financial and operational decision making. The
non-GAAP financial measures used by the Company in this press
release may be different from the non-GAAP financial measures,
including similarly titled measures, used by other companies.
For more information on the Company’s reports of financial
results that include these and other non-GAAP financial measures,
please see the Company’s previously reported financial results
which include a Reconciliation of GAAP to non-GAAP Financial
Measures tables regarding previously reported non-GAAP financial
measures included EBITDA and Adjusted EBITDA. Such accompanying
tables include details on the GAAP financial measures that are most
directly comparable to non-GAAP financial measures and the related
reconciliations between these financial measures.
FORWARD-LOOKING STATEMENTS
This release contains forward-looking statements within the
meaning of the federal securities laws, including without
limitation, statements regarding: our expectations regarding
sources and uses of capital including (i) remaining opportunistic
with respect to both sources and uses of capital, (ii) that the
repurchase $1 billion of our stock in 2017 has proven to be an
excellent allocation of capital for the long-term benefit of our
shareholders as well as our $1 billion in share repurchases
remaining an excellent allocation of capital for the long-term
benefit of our shareholders; our expectation that we will end
fiscal 2019 with net debt to trailing twelve month Adjusted EBITDA
of approximately 2.0x; our expectation regarding repayment of our
$300 million of 0.00% Convertible Senior Notes due 2020 at maturity
in July, 2020 with internally generated cash as well as borrowing
under our existing credit facilities; and any statements or
assumptions underlying any of the foregoing.
You can identify forward-looking statements by the fact that
they do not relate strictly to historical or current facts. These
statements may include words such as “anticipate,” “estimate,”
“expect,” “project,” “plan,” “intend,” “believe,” “may,” “will,”
“should,” “likely” and other words and terms of similar meaning in
connection with any discussion of the timing or nature of future
events. We cannot assure you that future developments affecting us
will be those that we have anticipated. Important risks and
uncertainties that could cause actual results to differ materially
from our expectations include, among others, risks related to our
dependence on key personnel and any changes in our ability to
retain key personnel; successful implementation of our growth
strategy; risks related to the number of new business initiatives
we are undertaking; successful implementation of our growth
strategy including our real estate transformation and the number of
new gallery locations that we seek to open and the timing of
openings; uncertainties in the current performance of our business
including a range of risks related to our operations as well as
external economic factors; general economic conditions and the
housing market as well as the impact of economic conditions on
consumer confidence and spending; changes in customer demand for
our products; our ability to anticipate consumer preferences and
buying trends, and maintaining our brand promise to customers;
decisions concerning the allocation of capital; factors affecting
our outstanding convertible senior notes or other forms of our
indebtedness; our ability to anticipate consumer preferences and
buying trends, and maintain our brand promise to customers; changes
in consumer spending based on weather and other conditions beyond
our control; risks related to the number of new business
initiatives we are undertaking; strikes and work stoppages
affecting port workers and other industries involved in the
transportation of our products; our ability to obtain our products
in a timely fashion or in the quantities required; our ability to
employ reasonable and appropriate security measures to protect
personal information that we collect; our ability to support our
growth with appropriate information technology systems; risks
related to our sourcing and supply chain including our dependence
on imported products produced by foreign manufacturers and risks
related to importation of such products including risks related to
tariffs, the countermeasures and mitigation steps that we adopt in
response to tariffs and other similar issues, as well as those
risks and uncertainties disclosed under the sections entitled “Risk
Factors” and “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” in RH’s most recent Form 10-K
and Form 10-Q filed with the Securities and Exchange Commission,
and similar disclosures in subsequent reports filed with the SEC,
which are available on our investor relations website at ir.rh.com
and on the SEC website at www.sec.gov. Any forward-looking
statement made by us in this press release speaks only as of the
date on which we make it. We undertake no obligation to publicly
update any forward-looking statement, whether as a result of new
information, future developments or otherwise, except as may be
required by any applicable securities laws.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190617005856/en/
Allison Malkin203-682-8225allison.malkin@icrinc.com
RH (NYSE:RH)
Historical Stock Chart
From Mar 2024 to Apr 2024
RH (NYSE:RH)
Historical Stock Chart
From Apr 2023 to Apr 2024