At Home Group Inc. Announces First Quarter Fiscal 2022 Financial Results
At Home Group reported a substantial 182.9% increase in net sales, reaching $537.1 million for Q1 fiscal 2022, compared to $189.8 million in Q1 fiscal 2021. Comparable store sales surged by 187.3%, benefiting from strong demand and stimulus payments. Gross profit rose to $200.3 million, improving gross margin to 37.3%. Operating income stood at $89.4 million, reversing a previous loss of $(372.1) million. The company announced a definitive agreement to be acquired for $36.00 per share, with expectations for completion in Q3 2021. No future guidance is provided due to the pending acquisition.
- Net sales increased by 182.9% to $537.1 million.
- Comparable store sales rose 187.3%, indicating strong consumer demand.
- Gross profit improved to $200.3 million, up from $16.4 million.
- Operating income of $89.4 million compared to a loss of $(372.1) million last year.
- Increased freight costs expected to negatively impact gross margin in H2 fiscal 2022.
- No formal guidance provided due to uncertainty from pending acquisition.
At Home Group Inc. (NYSE: HOME), the home décor superstore, today announced its financial results for the first quarter ended May 1, 2021.
For the Thirteen Weeks Ended May 1, 2021
-
The Company opened nine and closed two stores in the first quarter of fiscal 2022, ending the quarter with 226 stores in 40 states. The Company opened a net eight stores since the first quarter of fiscal 2021, representing a
3.7% increase. -
Net sales increased
182.9% to$537.1 million from$189.8 million in the first quarter of fiscal 2021. -
Comparable store sales increased
187.3% driven by strong demand, including approximately$45 million of estimated sales benefit attributable to stimulus payments not expected to recur in future quarters and the continued execution of our strategic initiatives. Reported comparable store sales in the first and second quarters of fiscal 2021 were (46.5% ) and42.3% respectively. Adjusting for the calendar shift as a result of the 53rd week in fiscal year 2021, comparable store sales in the first and second quarters of fiscal 2021 would have been approximately 300 basis points lower and 800 basis points higher, respectively, largely due to the impact of temporary store closures during those periods related to the COVID-19 pandemic. -
Gross profit was
$200.3 million compared to$16.4 million in the first quarter of fiscal 2021. Gross margin was37.3% compared to8.6% in the prior year period primarily due to occupancy, depreciation, freight and distribution center expense leverage as a result of increased net sales and, to a lesser extent, product margin expansion. The Company continues to expect increased freight costs to significantly impact gross margin in the second half of fiscal 2022. -
Selling, general and administrative expenses (“SG&A”) increased
63.3% to$108.5 million from$66.5 million in the first quarter of fiscal 2021. As a percentage of net sales, SG&A decreased to20.2% from35.0% in the prior year period primarily due to expense leverage as a result of increased sales. -
Operating income was
$89.4 million compared to a loss of$(372.1) million in the first quarter of fiscal 2021 that included a non-cash goodwill impairment charge of$319.7 million . Adjusted operating income1 increased to$90.0 million from a loss of$(52.3) million in the prior year period. Adjusted operating margin1 increased to16.8% from (27.6)% driven by the gross margin and SG&A factors described above. -
Interest expense increased to
$8.1 million from$7.0 million in the first quarter of fiscal 2021 primarily due to interest incurred on our8.750% senior secured notes and$35.0 million term loan tranche (the “FILO Loans”), and partially offset by interest avoided by the repayment of our term loan and no borrowings outstanding under our revolving credit facility (the “ABL Facility”). -
Income tax expense was
$19.7 million , and our effective tax rate was25.9% . In the first quarter of fiscal 2021, income tax benefit was$20.1 million , and our effective tax rate was5.3% . -
Net income was
$56.3 million compared to a loss of$(358.9) million in the first quarter of fiscal 2021. Adjusted Net Income1 was$60.7 million compared to a loss of$(39.2) million in the prior year period. -
EPS was
$0.81 compared to$(5.60) in the first quarter of fiscal 2021 and adjusted EPS1 was$0.87 compared to$(0.61) in the prior year period. -
Adjusted EBITDA1 was
$110.6 million compared to$(14.6) million in the first quarter of fiscal 2021.
Balance Sheet Highlights as of May 1, 2021
-
The Company had
$150.5 million of cash and no borrowings outstanding under the ABL Facility compared to$43.6 million of cash and$342.0 million of borrowings as of April 25, 2020. Borrowing availability under the ABL Facility was$325.2 million , inclusive of$35.0 million of minimum required availability. -
Net inventories decreased
9.3% to$369.0 million from$407.0 million as of April 25, 2020. -
Long-term debt was
$308.6 million compared to$334.2 million as of April 25, 2020. On April 30, 2021, the Company repaid in full the FILO Loans for$34.6 million , including a$2.0 million prepayment premium, which resulted in a$5.3 million loss on extinguishment of debt.
(1) |
Represents a non-GAAP financial measure. For additional information about non-GAAP measures, including, where applicable, reconciliations to the most directly comparable financial measures presented in accordance with GAAP, please see “Non-GAAP Measures” below. Refer to “Terminology” section for the Company’s non-GAAP definitions. |
Subsequent Events
On May 6, 2021, the Company announced it has entered into a definitive agreement to be acquired by funds affiliated with Hellman & Friedman LLC (“the transaction”). Under the terms of the agreement, At Home stockholders will receive
Outlook and At Home Preliminary Proxy Filing Regarding Pending Transaction
Given the pending transaction and the continued uncertainty related to COVID-19, the Company is not providing formal guidance at this time.
In a separate press release issued today, At Home announced the filing of its preliminary proxy materials with the Securities and Exchange Commission in connection with the transaction. Among other things, the preliminary proxy and press release include the Company’s financial projections through fiscal 2026.
The press release and corresponding filing are available on the Company’s investor relations page at investor.athome.com.
Conference Call
Due to the pending transaction, the Company will not host a conference call to review the first quarter fiscal 2022 financial results.
Terminology
We define certain terms used in this release as follows:
“Adjusted EBITDA” means net income (loss) before net interest expense, income tax provision (benefit) and depreciation and amortization, adjusted for the impact of certain other items as defined in our debt agreements, including certain legal settlements and consulting and other professional fees, stock-based compensation expense, impairment charges, loss on extinguishment of debt, (gain) loss on sale-leaseback, non-cash rent and other adjustments.
“Adjusted Net Income” means net income (loss), adjusted for impairment charges, (gain) loss on sale-leaseback, loss on extinguishment of debt, payroll tax expenses and the income tax associated with initial public offering non-cash stock-based compensation expense (the “IPO Grant”) and other adjustments.
“Adjusted operating income” means operating income (loss), adjusted for impairment charges, (gain) loss on sale-leaseback, payroll tax expenses associated with IPO Grant stock option exercises and other adjustments.
“Adjusted operating margin” means adjusted operating income (loss) divided by net sales.
“Adjusted SG&A” means selling, general and administrative expenses adjusted for certain expenses, including payroll tax expenses associated with IPO Grant stock option exercises and other adjustments.
“Comparable store sales” means, for any reporting period, the change in period-over-period net sales for the comparable store base. A store is included in the comparable store sales calculation on the first day of the sixteenth full fiscal month following the store's opening, which is when we believe comparability is achieved. When a store is being relocated or remodeled, we exclude sales from that store in the calculation of comparable store sales until the first day of the sixteenth full fiscal month after it reopens. Sales resulting from our omnichannel initiatives occur at the store level and are included in the calculation of comparable store sales.
“EPS” means diluted earnings (loss) per share.
“GAAP” means accounting principles generally accepted in the United States.
“Leverage ratio” means Net Debt divided by Adjusted EBITDA for the trailing twelve months.
“Net Debt” includes long-term debt, borrowing under the ABL revolving credit facility, and current portion of long-term debt and financing obligations, less unamortized deferred debt issuance cost and cash and cash equivalents. Net Debt excludes operating lease liabilities recognized in accordance with ASC 842 Leases.
“Adjusted EPS” means Adjusted Net Income divided by diluted weighted average shares outstanding.
“Store-level Adjusted EBITDA” means Adjusted EBITDA, adjusted further to exclude the impact of costs associated with new store openings and certain corporate overhead expenses that we do not consider in our evaluation of the ongoing operating performance of our stores from period to period.
Additional Information and Where to Find It
This communication may be deemed to be solicitation material in respect of the proposed acquisition of the Company by an affiliate of Hellman & Friedman LLC. In connection with the proposed merger, the Company will file with the Securities and Exchange Commission (“SEC”) and furnish to its stockholders a proxy statement and other relevant documents. STOCKHOLDERS OF THE COMPANY ARE ADVISED TO READ THE PROXY STATEMENT WHEN IT BECOMES AVAILABLE (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO) BECAUSE IT WILL CONTAIN IMPORTANT INFORMATION. Investors may obtain a free copy of the proxy statement (when it becomes available) and other relevant documents filed by the Company with the SEC at the SEC’s Web site at http://www.sec.gov. The proxy statement and such other documents once filed by the Company with the SEC may also be obtained for free from the Investor Relations section of the Company’s web site (http://investor.athome.com/) or by directing a request to: the Company, 1600 East Plano Parkway, Plano, Texas, 75074, Attention: Investor Relations. Copies of documents filed by the Company with the SEC may also be obtained for free at the SEC’s Web site at http://www.sec.gov.
Participants in the Solicitation
The Company and its officers and directors may be deemed to be participants in the solicitation of proxies from the stockholders of the Company in connection with the proposed merger. Information about the Company’s executive officers and directors is set forth in the Company’s Annual Report on Form 10-K, which was filed by the Company with the SEC on March 24, 2021, and the proxy statement for the Company’s 2021 annual meeting of stockholders, which was filed with the SEC by the Company on May 4, 2021. Investors may obtain more detailed information regarding the direct and indirect interests of the Company and its executive officers and directors in the proposed merger by reading the preliminary and definitive proxy statement regarding the proposed merger when each such document is filed with the SEC. When available, you may obtain free copies of these documents as described in the preceding paragraph.
Forward-Looking Statements
This release contains forward-looking statements made pursuant to and within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. You can generally identify forward-looking statements by our use of forward-looking terminology such as "anticipate", "are confident", "assume", "believe", "continue", "could", "estimate", "expect", "intend", “look ahead”, "look forward", "may", "might", "on track", "outlook", "plan", "potential", "predict", "reaffirm", "seek", "should", "trend", “will”, or “vision” or the negative thereof or comparable terminology regarding future events or conditions. In particular, forward-looking statements in this release include, without limitation, statements about our financial and operating performance, cash flows, liquidity, financial condition, inventory, the markets in which we operate, expected new store openings, our real estate strategy, the impact of the COVID-19 pandemic, growth targets, potential growth opportunities, market share, competition, the impact of expected stock option exercises and future capital expenditures, estimates of expenses we may incur in connection with equity incentive awards to management, customer and macroeconomic trends, expectations regarding the closing of the merger and other statements regarding our expectations, beliefs, plans, strategies, objectives, prospects, assumptions, or future events or performance.
Such forward-looking statements are based on our current beliefs and expectations, which we believe are reasonable. However, forward-looking statements are subject to significant known and unknown risks and uncertainties that may cause actual results, performance or achievements in future periods to differ materially from those assumed, projected or contemplated in the forward-looking statements, including, but not limited to, the following factors: the ongoing global COVID-19 pandemic and related challenges, risks and uncertainties, including historical and potential future measures taken by governmental and regulatory authorities (such as requiring store closures), which have significantly disrupted our business, employees, customers and global supply chain, and for a period of time, adversely impacted our financial condition (including resulting in goodwill impairment) and financial performance, and which disruption and adverse impacts may continue in the future; the recent and ongoing direct and indirect adverse impacts of the global COVID-19 pandemic to the global economy and retail industry; the eventual timing and duration of economic stabilization and recovery from the COVID-19 pandemic; general economic conditions in the United States and globally, including consumer confidence and spending, and any changes to current favorable macroeconomic trends of strong home sales, nesting and de-urbanization (which were enhanced and accelerated due to COVID-19, and may not continue upon a successful vaccine rollout in significant numbers that impacts consumer behavior); our indebtedness and our ability to increase future leverage, as well as limitations on future sources of liquidity, including debt covenant compliance; our ability to implement our growth strategy of opening new stores, which was suspended for fiscal 2021 (with the exception of stores that were at or near completion) and, while ramping significantly, will be limited in the near term; our ability to effectively obtain, manage and allocate inventory, and satisfy changing consumer preferences; increasing freight and transportation costs (including the adverse effects of international equipment shortages and shipping delays) and increasing commodity prices; reliance on third-party vendors for a significant portion of our merchandise, including supply chain disruption matters and international trade regulations (including tariffs) that have, and may continue to, adversely impact many international vendors; the loss or disruption to operating our distribution network; significant competition in the fragmented home décor industry, including increasing e-commerce; the implementation and execution of our At Home 2.0 and omnichannel strategies and related investments; natural disasters and other adverse impacts on regions in the United States where we have significant operations; our success in obtaining favorable lease terms and of our sale-leaseback strategy; our reliance on the continuing growth and utility of our loyalty program; our ability to attract, develop and retain employee talent and to manage labor costs; the disproportionate impact of our seasonal sales activity to our overall results; risks related to the loss or disruption of our information systems and data and our ability to prevent or mitigate breaches of our information security and the compromise of sensitive and confidential data; our ability to comply with privacy and other laws and regulations, including those associated with entering new markets; the possibility that we may be unable to obtain required stockholder approval or that other conditions to closing the proposed merger with Hellman & Friedman LLC may not be satisfied, such that the proposed merger will not close or that the closing may be delayed; general economic conditions; the proposed merger may involve unexpected costs, liabilities or delays; risks that the transaction disrupts our current plans and operations; the outcome of any legal proceedings related to the proposed merger; the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; and the significant volatility of the trading price of our common stock.
Additional information about these and other factors that may cause actual results, performance or achievements in future periods to differ materially from those assumed, projected or contemplated in the forward-looking statements may be found in “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended January 30, 2021 and subsequent reports we file with the Securities and Exchange Commission, including our Quarterly Reports on Form 10-Q. You are cautioned not to place undue reliance on the forward-looking statements included herein, which speak only as of the date hereof or the date otherwise specified herein. Except as required by law, we do not undertake any obligation to update or revise any forward-looking statements for any reason, whether as a result of new information, future events or otherwise.
About At Home Group Inc.
At Home (NYSE:HOME), the home decor superstore, offers over 50,000 on-trend home products to fit any budget or style, from furniture, mirrors, rugs, art and housewares to tabletop, patio and seasonal decor. At Home is headquartered in Plano, Texas, and currently operates 226 stores in 40 states. For more information, please visit us online at investor.athome.com.
-Financial Tables to Follow-
AT HOME GROUP INC. |
|||||||||||||
Condensed Consolidated Balance Sheets |
|||||||||||||
(in thousands, except share and per share data) |
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
May 1, 2021 |
|
January 30, 2021 |
|
April 25, 2020 |
|
||||||
Assets |
|
|
|
|
|
|
|
|
|
|
|||
Current assets: |
|
|
|
|
|
|
|
|
|
|
|||
Cash and cash equivalents |
|
$ |
150,547 |
|
|
$ |
125,842 |
|
|
$ |
43,640 |
|
|
Inventories, net |
|
|
369,014 |
|
|
|
364,473 |
|
|
|
406,972 |
|
|
Prepaid expenses |
|
|
14,665 |
|
|
|
13,456 |
|
|
|
12,254 |
|
|
Income taxes receivable |
|
|
— |
|
|
|
22,223 |
|
|
|
38,536 |
|
|
Other current assets |
|
|
16,967 |
|
|
|
11,619 |
|
|
|
10,325 |
|
|
Total current assets |
|
|
551,193 |
|
|
|
537,613 |
|
|
|
511,727 |
|
|
Operating lease right-of-use assets |
|
|
1,313,104 |
|
|
|
1,289,991 |
|
|
|
1,237,563 |
|
|
Property and equipment, net |
|
|
713,187 |
|
|
|
688,295 |
|
|
|
715,427 |
|
|
Trade name |
|
|
1,458 |
|
|
|
1,458 |
|
|
|
1,458 |
|
|
Debt issuance costs, net |
|
|
4,984 |
|
|
|
5,264 |
|
|
|
1,096 |
|
|
Other assets |
|
|
1,845 |
|
|
|
2,292 |
|
|
|
1,091 |
|
|
Total assets |
|
$ |
2,585,771 |
|
|
$ |
2,524,913 |
|
|
$ |
2,468,362 |
|
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|||
Current liabilities: |
|
|
|
|
|
|
|
|
|
|
|||
Accounts payable |
|
$ |
123,219 |
|
|
$ |
130,327 |
|
|
$ |
114,504 |
|
|
Accrued and other current liabilities |
|
|
162,537 |
|
|
|
184,850 |
|
|
|
78,099 |
|
|
Revolving line of credit |
|
|
— |
|
|
|
— |
|
|
|
342,000 |
|
|
Current portion of operating lease liabilities |
|
|
78,106 |
|
|
|
78,634 |
|
|
|
82,040 |
|
|
Current portion of long-term debt |
|
|
1,037 |
|
|
|
4,563 |
|
|
|
5,050 |
|
|
Income taxes payable |
|
|
19,637 |
|
|
|
— |
|
|
|
— |
|
|
Total current liabilities |
|
|
384,536 |
|
|
|
398,374 |
|
|
|
621,693 |
|
|
Operating lease liabilities |
|
|
1,337,578 |
|
|
|
1,315,625 |
|
|
|
1,257,430 |
|
|
Long-term debt |
|
|
308,555 |
|
|
|
314,300 |
|
|
|
334,174 |
|
|
Deferred income taxes |
|
|
6,034 |
|
|
|
9,716 |
|
|
|
— |
|
|
Other long-term liabilities |
|
|
2,864 |
|
|
|
2,738 |
|
|
|
3,349 |
|
|
Total liabilities |
|
|
2,039,567 |
|
|
|
2,040,753 |
|
|
|
2,216,646 |
|
|
Stockholders' Equity |
|
|
|
|
|
|
|
|
|
|
|||
Common stock; |
|
|
655 |
|
|
|
653 |
|
|
|
642 |
|
|
Additional paid-in capital |
|
|
688,023 |
|
|
|
682,304 |
|
|
|
659,084 |
|
|
Accumulated deficit |
|
|
(142,474 |
) |
|
|
(198,797 |
) |
|
|
(408,010 |
) |
|
Total stockholders' equity |
|
|
546,204 |
|
|
|
484,160 |
|
|
|
251,716 |
|
|
Total liabilities and stockholders' equity |
|
$ |
2,585,771 |
|
$ |
2,524,913 |
|
$ |
2,468,362 |
|
|
AT HOME GROUP INC. |
|||||||
Condensed Consolidated Statements of Operations |
|||||||
(in thousands, except share and per share data) |
|||||||
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks Ended |
|||||
|
|
May 1, 2021 |
|
April 25, 2020 |
|||
|
|
|
|
|
|
||
Net sales |
|
$ |
537,078 |
|
$ |
189,846 |
|
Cost of sales |
|
|
336,803 |
|
|
173,496 |
|
Gross profit |
|
|
200,275 |
|
|
16,350 |
|
|
|
|
|
|
|
|
|
Operating expenses |
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
|
108,536 |
|
|
66,466 |
|
Impairment charges |
|
|
— |
|
|
319,732 |
|
Depreciation and amortization |
|
|
2,317 |
|
|
2,213 |
|
Total operating expenses |
|
|
110,853 |
|
|
388,411 |
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
|
89,422 |
|
|
(372,061 |
) |
Interest expense, net |
|
|
8,119 |
|
|
6,971 |
|
Loss on extinguishment of debt |
|
|
5,253 |
|
|
— |
|
Income (loss) before income taxes |
|
|
76,050 |
|
|
(379,032 |
) |
Income tax provision (benefit) |
|
|
19,727 |
|
|
(20,090 |
) |
Net income (loss) |
|
$ |
56,323 |
|
$ |
(358,942 |
) |
|
|
|
|
|
|
|
|
Earnings per share: |
|
|
|
|
|
|
|
Net income (loss) per common share: |
|
|
|
|
|
|
|
Basic |
|
$ |
0.86 |
|
$ |
(5.60 |
) |
Diluted |
|
$ |
0.81 |
|
$ |
(5.60 |
) |
Weighted average shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
|
65,405,610 |
|
|
64,130,000 |
|
Diluted |
|
|
69,544,441 |
|
|
64,130,000 |
AT HOME GROUP INC. |
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Condensed Consolidated Statements of Cash Flows |
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(in thousands) |
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|
|
|
|
|
|
|
|
||
|
|
Thirteen Weeks Ended |
|
||||||
|
|
May 1, 2021 |
|
April 25, 2020 |
|
||||
Operating Activities |
|
|
|
|
|
|
|
||
Net income (loss) |
|
$ |
56,323 |
|
|
$ |
(358,942 |
) |
|
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
|
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
18,323 |
|
|
|
18,148 |
|
|
Non-cash lease expense |
|
|
21,076 |
|
|
|
19,420 |
|
|
Impairment charges |
|
|
- |
|
|
|
319,732 |
|
|
Loss on extinguishment of debt |
|
|
5,253 |
|
|
|
- |
|
|
Non-cash interest expense |
|
|
1,496 |
|
|
|
550 |
|
|
Deferred income taxes |
|
|
(3,681 |
) |
|
|
16,965 |
|
|
Stock-based compensation |
|
|
4,116 |
|
|
|
2,063 |
|
|
Other non-cash losses, net |
|
|
237 |
|
|
|
7 |
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
||
Inventories |
|
|
(4,541 |
) |
|
|
10,791 |
|
|
Prepaid expenses and other current assets |
|
|
15,666 |
|
|
|
(43,213 |
) |
|
Other assets |
|
|
457 |
|
|
|
(48 |
) |
|
Accounts payable |
|
|
(9,047 |
) |
|
|
(7,261 |
) |
|
Accrued liabilities |
|
|
(23,971 |
) |
|
|
(31,933 |
) |
|
Income taxes payable |
|
|
19,280 |
|
|
|
(137 |
) |
|
Operating lease liabilities |
|
|
(23,207 |
) |
|
|
(1,345 |
) |
|
Net cash provided by (used in) operating activities |
|
|
77,780 |
|
|
|
(55,203 |
) |
|
Investing Activities |
|
|
|
|
|
|
|
||
Purchase of property and equipment |
|
|
(19,272 |
) |
|
|
(19,236 |
) |
|
Net proceeds from sale of property and equipment |
|
|
59 |
|
|
|
- |
|
|
Net cash used in investing activities |
|
|
(19,213 |
) |
|
|
(19,236 |
) |
|
Financing Activities |
|
|
|
|
|
|
|
||
Payments under lines of credit |
|
|
- |
|
|
|
(98,310 |
) |
|
Proceeds from lines of credit |
|
|
- |
|
|
|
204,640 |
|
|
Payment of Term Loan |
|
|
- |
|
|
|
(880 |
) |
|
Payment of FILO Loans and prepayment premium |
|
|
(35,225 |
) |
|
|
- |
|
|
Payments on long-term debt |
|
|
(232 |
) |
|
|
(102 |
) |
|
Proceeds from issuance of long-term debt |
|
|
- |
|
|
|
664 |
|
|
Proceeds from (payments for) stock, including tax |
|
|
1,605 |
|
|
|
(16 |
) |
|
Net cash (used in) provided by financing activities |
|
|
(33,852 |
) |
|
|
105,996 |
|
|
Increase in cash, cash equivalents and restricted cash |
|
|
24,715 |
|
|
|
31,557 |
|
|
Cash, cash equivalents and restricted cash, beginning of period |
|
|
125,877 |
|
|
|
12,085 |
|
|
Cash, cash equivalents and restricted cash, end of period |
|
$ |
150,592 |
|
|
$ |
43,642 |
|
|
|
|
|
|
|
|
|
|
||
Supplemental Cash Flow Information |
|
|
|
|
|
|
|
||
Cash paid for interest |
|
$ |
13,579 |
|
|
$ |
6,689 |
|
|
Cash received for income taxes |
|
$ |
(18,076 |
) |
|
$ |
(10 |
) |
|
Supplemental Information for Non-cash Investing and Financing Activities |
|
|
|
|
|
|
|
||
Increase in current liabilities of property and equipment |
|
$ |
4,079 |
|
|
$ |
157 |
|
|
Property and equipment acquired under finance lease, net |
|
$ |
20,160 |
|
|
$ |
- |
|
|
Non-GAAP Measures
Certain financial measures presented in this release, such as leverage ratio, Net Debt, Adjusted EBITDA, adjusted SG&A, adjusted operating income, adjusted operating margin, Adjusted Net Income, adjusted EPS and Store-level Adjusted EBITDA (collectively, “non-GAAP financial measures”), are not presented in accordance with GAAP.
These non-GAAP financial measures are used by our management and our board of directors to assess our financial performance. We present leverage ratio and Net Debt because we believe that investors find these metrics useful in evaluating our overall liquidity. Adjusted EBITDA is frequently used by analysts, investors and other interested parties to evaluate companies in our industry. In addition to covenant compliance, 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 peer companies using similar measures. We use Store-level Adjusted EBITDA as a supplemental measure to evaluate the performance and profitability of each of our stores, individually and in the aggregate, especially given the level of investments we have made in our home office and infrastructure over the past eight years to support future growth. We also believe that Store-level Adjusted EBITDA is a useful measure in evaluating our operating performance because it removes the impact of general and administrative expenses, which are not incurred at the store level, and the costs of opening new stores, which are non-recurring at the store level, and thereby enables the comparability of the operating performance of our stores during the period. We use Store-level Adjusted EBITDA information to benchmark our performance versus competitors. Store-level Adjusted EBITDA should not be used as a substitute for consolidated measures of profitability of performance because it does not reflect corporate overhead expenses that are necessary to allow us to effectively operate our stores and generate Store-level Adjusted EBITDA. We present adjusted SG&A, adjusted operating income, adjusted operating margin, Adjusted Net Income and adjusted EPS because we believe it assists investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.
You are encouraged to evaluate these non-GAAP financial measures and the reasons we consider them appropriate for supplemental analysis. In evaluating our non-GAAP financial measures, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in our presentation of non-GAAP financial measures. Our presentation of non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. There can be no assurance that we will not modify the presentation of our non-GAAP financial measures in the future, and any such modification may be material. In addition, our non-GAAP financial measures may not be comparable to similarly titled measures used by other companies in our industry or across different industries.
AT HOME GROUP INC.
Supplemental Information - Reconciliation of GAAP to Non-GAAP Financial Measures
(in thousands, except margin, share, per share and ratio data)
The tables below reconcile the non-GAAP financial measures of adjusted SG&A, adjusted operating income, Adjusted Net Income, adjusted EPS, Adjusted EBITDA, Store-level Adjusted EBITDA, Net Debt and leverage ratio to their most directly comparable GAAP financial measures.
Reconciliation of selling, general and administrative expenses to adjusted SG&A |
||||||||
|
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks Ended |
|
|||||
|
|
May 1, 2021 |
|
April 25, 2020 |
|
|||
|
|
|
|
|
|
|
||
Selling, general and administrative expenses, as reported |
|
$ |
108,536 |
|
|
$ |
66,466 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Other(a) |
|
|
(543 |
) |
|
|
— |
|
Adjusted selling, general and administrative expenses |
|
$ |
107,993 |
|
|
$ |
66,466 |
|
Reconciliation of operating income (loss) to adjusted operating income |
|||||||||
|
|
|
|
|
|
|
|
||
|
|
Thirteen Weeks Ended |
|
||||||
|
|
May 1, 2021 |
|
April 25, 2020 |
|
||||
|
|
|
|
|
|
|
|||
Operating income (loss), as reported |
|
$ |
89,422 |
|
|
$ |
(372,061 |
) |
|
Adjustments: |
|
|
|
|
|
|
|
||
Impairment charges(b) |
|
|
— |
|
|
|
319,732 |
|
|
Other(a) |
|
|
543 |
|
|
|
— |
|
|
Adjusted operating income |
|
$ |
89,965 |
|
|
$ |
(52,329 |
) |
|
Adjusted operating margin |
|
|
16.8 |
% |
|
|
(27.6 |
)% |
|
Reconciliation of net income (loss) to Adjusted Net Income and adjusted EPS |
|||||||||
|
|
|
|
|
|
|
|
||
|
|
Thirteen Weeks Ended |
|
||||||
|
|
May 1, 2021 |
|
April 25, 2020 |
|
||||
|
|
|
|
|
|
|
|||
Net income (loss), as reported |
|
$ |
56,323 |
|
|
$ |
(358,942 |
) |
|
Adjustments: |
|
|
|
|
|
|
|
||
Impairment charges(b) |
|
|
— |
|
|
|
319,732 |
|
|
Loss on extinguishment of debt |
|
|
5,253 |
|
|
|
— |
|
|
Other(a) |
|
|
543 |
|
|
|
— |
|
|
Tax impact of adjustments to net income (loss)(c) |
|
|
(1,373 |
) |
|
|
— |
|
|
Adjusted Net Income |
|
|
60,746 |
|
|
|
(39,210 |
) |
|
Diluted weighted average shares outstanding |
|
|
69,544,441 |
|
|
|
64,130,000 |
|
|
Adjusted EPS |
|
$ |
0.87 |
|
|
$ |
(0.61 |
) |
|
______________ | ||
(a) |
Other adjustments include costs related to the pending merger with Hellman & Friedman LLC during the thirteen weeks ended May 1, 2021. |
|
(b) |
For the thirteen weeks ended April 25, 2020, represents a non-cash impairment charge of |
|
(c) |
Represents the income tax impact of the adjusted expenses using the annual effective tax rate excluding discrete items. After giving effect to the adjustments to net income (loss), the adjusted effective tax rate was |
Reconciliation of net income (loss) to EBITDA, Adjusted EBITDA and Store-level Adjusted EBITDA |
|||||||||
|
|
|
|
|
|
|
|
||
|
|
Thirteen Weeks Ended |
|
||||||
|
|
May 1, 2021 |
|
April 25, 2020 |
|
||||
|
|
|
|
|
|
|
|||
Net income (loss), as reported |
|
$ |
56,323 |
|
|
$ |
(358,942 |
) |
|
Interest expense, net |
|
|
8,119 |
|
|
|
6,971 |
|
|
Income tax provision (benefit) |
|
|
19,727 |
|
|
|
(20,090 |
) |
|
Depreciation and amortization(a) |
|
|
18,323 |
|
|
|
18,148 |
|
|
EBITDA |
|
|
102,492 |
|
|
|
(353,913 |
) |
|
Impairment charges(b) |
|
|
— |
|
|
|
319,732 |
|
|
Loss on extinguishment of debt |
|
|
5,253 |
|
|
|
— |
|
|
Consulting and other professional services(c) |
|
|
686 |
|
|
|
275 |
|
|
Stock-based compensation expense(d) |
|
|
4,116 |
|
|
|
2,063 |
|
|
Non-cash rent(e) |
|
|
(2,018 |
) |
|
|
17,233 |
|
|
Other(f) |
|
|
32 |
|
|
|
— |
|
|
Adjusted EBITDA |
|
|
110,561 |
|
|
|
(14,610 |
) |
|
Costs associated with new store openings(g) |
|
|
5,282 |
|
|
|
3,579 |
|
|
Corporate overhead expenses(h) |
|
|
39,515 |
|
|
|
25,017 |
|
|
Store-level Adjusted EBITDA |
|
$ |
155,358 |
|
|
$ |
13,986 |
|
|
______________ | ||
(a) |
Includes the portion of depreciation and amortization expenses that are classified as cost of sales in our condensed consolidated statements of operations. |
|
(b) |
For the thirteen weeks ended April 25, 2020, represents a non-cash impairment charge of |
|
(c) |
Primarily consists of other transaction costs, including |
|
(d) |
Non-cash stock-based compensation expense related to the ongoing equity incentive program that we have in place to incentivize, retain and motivate our employees, officers, consultants and non-employee directors. |
|
(e) |
Consists of the non-cash portion of rent, which reflects the extent to which our GAAP straight-line rent expense recognized exceeds or is less than our cash rent payments. The GAAP straight-line rent expense adjustment can vary depending on the average age of our lease portfolio, which has been impacted by our significant growth. For newer leases, our rent expense recognized typically exceeds our cash rent payments while for more mature leases, rent expense recognized is typically less than our cash rent payments. During the thirteen weeks ended April 25, 2020, due to the COVID-19 pandemic, we began renegotiating leases to include significant deferrals which resulted in higher non-cash rent expense. |
|
(f) |
Other adjustments include amounts our management believes are not representative of our ongoing operations. |
|
(g) |
Reflects non-capital expenditures associated with opening new stores, including marketing and advertising, labor and cash occupancy expenses. Costs related to new store openings represent cash costs, and you should be aware that in the future we may incur expenses that are similar to these costs. We anticipate that we will continue to incur cash costs as we open new stores in the future. We opened nine and six new stores during the thirteen weeks ended May 1, 2021 and April 25, 2020, respectively. |
|
(h) |
Reflects corporate overhead expenses, which are not directly related to the profitability of our stores, to facilitate comparisons of store operating performance as we do not consider these corporate overhead expenses when evaluating the ongoing performance of our stores from period to period. Corporate overhead expenses, which are a component of selling, general and administrative expenses, are comprised of various home office general and administrative expenses such as payroll expenses, occupancy costs, marketing and advertising, and consulting and professional fees. |
Reconciliation of long-term debt to Net Debt and leverage ratio |
|||||||||
|
|
|
|
|
|
|
|
||
|
|
May 1, 2021 |
|
April 25, 2020 |
|
||||
|
|
|
|
|
|
|
|
||
Long-term debt |
|
$ |
308,555 |
|
|
$ |
334,174 |
|
|
Revolving line of credit |
|
|
— |
|
|
|
342,000 |
|
|
Current portion of long-term debt |
|
|
1,037 |
|
|
|
5,050 |
|
|
Less: cash and cash equivalents |
|
|
(150,547 |
) |
|
|
(43,640 |
) |
|
Net Debt |
|
$ |
159,045 |
|
|
$ |
637,584 |
|
|
Adjusted EBITDA for the twelve months ended |
|
|
483,604 |
|
|
|
126,973 |
|
|
Leverage ratio |
|
|
0.3x |
|
|
|
5.0x |
|
|
HOME-F
View source version on businesswire.com: https://www.businesswire.com/news/home/20210602005407/en/
FAQ
What were At Home Group's Q1 fiscal 2022 net sales and how do they compare to Q1 fiscal 2021?
How did comparable store sales perform in the first quarter of fiscal 2022 for At Home Group?
What acquisition deal was announced by At Home Group on May 6, 2021?