Delaware | 001-38559 | 45-2936287 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||
25 Research Drive, Westborough, MA | 01581 | |||
(Address of principal executive offices) | (Zip Code) | |||
(774) 512-7400 | ||||
Registrant’s telephone number, including area code | ||||
N/A | ||||
(Former name or former address, if changed since last report) |
Item 2.02 | Results of Operations and Financial Condition. |
Item 9.01 | Financial Statements and Exhibits. |
Exhibit No. | Description | |
99.1 |
BJ’S WHOLESALE CLUB HOLDINGS, INC. | |
By: | /s/ Robert W. Eddy |
Name: | Robert W. Eddy |
Title: | Executive Vice President, Chief Financial and Administrative Officer |
• | Comparable club sales excluding gasoline sales increased 2.9% for the quarter and 2.2% for the full year |
• | Income from continuing operations of $63.7 million for the quarter and $127.1 million for the full year |
• | Record fourth quarter Adjusted EBITDA of $165.4 million and $578.4 million for the full year |
• | Net income of $64.3 million, or $0.46 per diluted share, and Adjusted net income of $62.1 million, or $0.44 per diluted share, for the quarter |
• | Net income of $127.3 million, or $1.05 per diluted share, and Adjusted net income of $186.2 million, or $1.33 per diluted share, for the full year |
• | Provides outlook for fiscal 2019 |
BJ'S WHOLESALE CLUB HOLDINGS, INC. | ||||||||||||||||||||||
(Amounts in thousands, except per share amounts) | ||||||||||||||||||||||
13 Weeks Ended February 2, 2019 | 14 Weeks Ended February 3, 2018 | % Growth | 52 Weeks Ended February 2, 2019 | 53 Weeks Ended February 3, 2018 | % Growth | |||||||||||||||||
Net sales | $ | 3,343,814 | $ | 3,489,973 | (4.2 | )% | $ | 12,724,454 | $ | 12,495,995 | 1.8 | % | ||||||||||
Membership fee income | 73,068 | 66,016 | 10.7 | % | 282,893 | 258,594 | 9.4 | % | ||||||||||||||
Total revenues | 3,416,882 | 3,555,989 | (3.9 | )% | 13,007,347 | 12,754,589 | 2.0 | % | ||||||||||||||
Operating income | 109,882 | 92,735 | 18.5 | % | 303,453 | 220,272 | 37.8 | % | ||||||||||||||
Income from continuing operations | 63,713 | 68,074 | (6.4 | )% | 127,092 | 51,975 | 144.5 | % | ||||||||||||||
Adjusted EBITDA (a) | 165,369 | 157,998 | 4.7 | % | 578,426 | 533,507 | 8.4 | % | ||||||||||||||
Net income | 64,307 | 66,708 | (3.6 | )% | 127,261 | 50,301 | 153.0 | % | ||||||||||||||
EPS (b) | 0.46 | 0.71 | (35.2 | )% | 1.05 | 0.54 | 94.4 | % | ||||||||||||||
Adjusted net income (a) | 62,106 | 50,633 | 22.7 | % | 186,153 | 123,092 | 51.2 | % | ||||||||||||||
Adjusted EPS (a) | 0.44 | 0.36 | 22.2 | % | 1.33 | 0.88 | 51.1 | % | ||||||||||||||
Basic weighted average shares | 135,910 | 88,454 | 53.7 | % | 116,599 | 88,386 | 31.9 | % | ||||||||||||||
Diluted weighted average shares | 139,708 | 93,514 | 49.4 | % | 121,135 | 92,264 | 31.3 | % |
a) | See “Note Regarding Non-GAAP Financial Information” beginning on Page 8 |
b) | EPS represents earnings per diluted share |
• | The fourth quarter and full year of fiscal 2017 included one additional week ("53rd week") compared to the fourth quarter and full year of fiscal 2018. Net sales and Net income for the 53rd week were approximately $240 million and $7 million, respectively. |
• | Comparable club sales are calculated using the National Retail Federation's restated calendar comparing similar weeks and exclude the 53rd week in fiscal 2017. |
• | Comparable club sales for the fourth quarter of fiscal 2018 increased 2.8% compared to the fourth quarter of fiscal 2017. Excluding the impact of gasoline sales, merchandise comparable sales increased 2.9%, representing the sixth consecutive quarter of positive merchandise comparable sales. For fiscal 2018, comparable sales increased 3.7% compared to fiscal 2017. Excluding the impact of gasoline sales, merchandise comparable sales for fiscal 2018 increased 2.2% compared to fiscal 2017. |
• | Gross profit increased to $628.9 million in the fourth quarter of fiscal 2018 from $621.3 million in the fourth quarter of fiscal 2017. For the full year gross profit increased to $2.36 billion from $2.24 billion in fiscal 2017. Excluding the impact of gasoline sales and membership fee income, merchandise gross margin rate increased by approximately 10 basis points over the fourth quarter of fiscal 2017 and by approximately 60 basis points over the full year of fiscal 2017. The improvement was primarily driven by continued progress in our category profitability improvement program. |
• | Selling, general and administrative expenses ("SG&A") were $517.0 million in the fourth quarter of fiscal 2018 compared to $527.7 million in the fourth quarter of fiscal 2017 and were $2.05 billion in fiscal 2018 compared to $2.02 billion in fiscal 2017. SG&A, excluding charges associated with stock-based compensation related to our initial public offering (“IPO”), costs related to our IPO and the registered offering by selling stockholders (the "offering costs"), club asset impairment charges, voluntary retirement severance costs, management fees and compensatory payments related to stock options, was $516.3 million in the fourth quarter of fiscal 2018 compared to $516.7 million in the fourth quarter of fiscal 2017 and was $2.0 billion in fiscal 2018 compared to $1.9 billion in fiscal 2017. The increase in SG&A reflects continued investments to drive the Company’s strategic priorities. |
• | Operating income increased to $109.9 million, or 3.2% of total revenue in the fourth quarter of fiscal 2018 compared to $92.7 million, or 2.6% of total revenue,in the fourth quarter of fiscal 2017. Excluding the voluntary retirement severance costs and management fees, operating income was $103.8 million, or 2.9% of total revenues, in the fourth quarter of fiscal 2017. In fiscal 2018, operating income increased to $303.5 million from $220.3 million in the prior year. Excluding charges associated with stock-based compensation related to our IPO, costs related to our IPO and the secondary offering, club asset impairment charges, voluntary retirement severance costs, management fees and compensatory payments related to stock options, operating income increased to $363.5 million in fiscal 2018 from $336.4 million in the prior year. |
• | Interest expense, net, decreased to $26.7 million in the fourth quarter of fiscal 2018 compared to $46.5 million in the fourth quarter of fiscal 2017. Excluding interest expense incurred on our second lien term loan prior to the paydown, interest expense, net, would have been $31.1 million in the fourth quarter of fiscal 2017. Interest expense, net, decreased to $164.5 million in fiscal 2018 from $196.7 million in fiscal 2017. Excluding expenses associated with the 2018 repricing of our outstanding borrowings, expenses associated with the paydown of our second lien term loan in the second quarter of 2018 and interest expense incurred on our second lien term loan prior to this paydown, interest expense, net, would have been $114.8 million in fiscal 2018 compared to $139.5 million in fiscal 2017. The decline in interest expense reflects the pay down of debt and the benefit of repricing our first lien term loan and ABL facilities in the third quarter of fiscal 2018. |
• | Income tax expense was $19.4 million in the fourth quarter of fiscal 2018 compared to an income tax benefit of $21.9 million in the fourth quarter of fiscal 2017. The fourth quarter of fiscal 2018 included a benefit of $2.7 million from windfall tax benefits related to exercised stock options. The fourth quarter of fiscal 2017 included a benefit of approximately $32.1 million, associated with re-measurement of net deferred tax liabilities resulting from the Tax Cuts and Jobs Act of 2017. For fiscal 2018, income tax expense was $11.8 million compared to a benefit of $28.4 million in fiscal 2017. |
Outlook | |||||||
FY Ending February 1, 2020(a) | Outlook | ||||||
Amounts in millions, except for per share amounts. Net sales is in billions. | FY 2019 | ||||||
Net sales | $12.9 - $13.2 | ||||||
Merchandise Comparable Store Sales (b) | 1.5% - 2.5% | ||||||
Income from Continuing Operations | $200 - $212 | ||||||
Adjusted EBITDA | $590 - $600 | ||||||
Interest expense | $105- $110 | ||||||
Tax Rate(c) | Approx. 25% | ||||||
Net income | $200 - $212 | ||||||
EPS (d) | $1.42 - $1.50 | ||||||
Capital Expenditures | Approx. $200 | ||||||
a) | Reflects the estimated impact of adopting the lease accounting standard. The new standard is not expected to have a material impact on earnings. |
b) | Merchandise comparable store sales excludes gasoline. |
c) | Tax rate reflects statutory rate of 28.1% offset by estimated future windfall stock benefits. |
d) | Based on estimated diluted weighted average shares outstanding of approximately 141 million. |
BJ'S WHOLESALE CLUB HOLDINGS, INC. | ||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
(Amounts in thousands, except per share amounts) | ||||||||||||||||
(Unaudited) | ||||||||||||||||
13 Weeks Ended February 2, 2019 | 14 Weeks Ended February 3, 2018 | 52 Weeks Ended February 2, 2019 | 53 Weeks Ended February 3, 2018 | |||||||||||||
Net sales | $ | 3,343,814 | $ | 3,489,973 | $ | 12,724,454 | $ | 12,495,995 | ||||||||
Membership fee income | 73,068 | 66,016 | 282,893 | 258,594 | ||||||||||||
Total revenues | 3,416,882 | 3,555,989 | 13,007,347 | 12,754,589 | ||||||||||||
Cost of sales | 2,787,937 | 2,934,702 | 10,646,452 | 10,513,492 | ||||||||||||
Selling, general and administrative expenses | 517,010 | 527,704 | 2,051,324 | 2,017,821 | ||||||||||||
Preopening expense | 2,053 | 848 | 6,118 | 3,004 | ||||||||||||
Operating income | 109,882 | 92,735 | 303,453 | 220,272 | ||||||||||||
Interest expense, net | 26,748 | 46,513 | 164,535 | 196,724 | ||||||||||||
Income from continuing operations before income taxes | 83,134 | 46,222 | 138,918 | 23,548 | ||||||||||||
Provision (benefit) for income taxes | 19,421 | (21,852 | ) | 11,826 | (28,427 | ) | ||||||||||
Income from continuing operations | 63,713 | 68,074 | 127,092 | 51,975 | ||||||||||||
Income (loss) from discontinued operations, net of income taxes | 594 | (1,366 | ) | 169 | (1,674 | ) | ||||||||||
Net income | $ | 64,307 | $ | 66,708 | $ | 127,261 | $ | 50,301 | ||||||||
Income per share attributable to common stockholders - basic: | ||||||||||||||||
Income from continuing operations | $ | 0.47 | $ | 0.77 | $ | 1.09 | $ | 0.59 | ||||||||
Loss from discontinued operations | — | (0.02 | ) | — | (0.02 | ) | ||||||||||
Net income | $ | 0.47 | $ | 0.75 | $ | 1.09 | $ | 0.57 | ||||||||
Income per share attributable to common stockholders - diluted: | ||||||||||||||||
Income from continuing operations | $ | 0.46 | $ | 0.73 | $ | 1.05 | $ | 0.56 | ||||||||
Loss from discontinued operations | — | (0.02 | ) | — | (0.02 | ) | ||||||||||
Net income | $ | 0.46 | $ | 0.71 | $ | 1.05 | $ | 0.54 | ||||||||
Weighted average number of common shares outstanding: | ||||||||||||||||
Basic | 135,910 | 88,454 | 116,599 | 88,386 | ||||||||||||
Diluted | 139,708 | 93,514 | 121,135 | 92,264 |
BJ'S WHOLESALE CLUB HOLDINGS, INC. | ||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
(Amounts in thousands) | ||||||||||
(Unaudited) | ||||||||||
February 2, 2019 | February 3, 2018 | |||||||||
ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | 27,146 | $ | 34,954 | ||||||
Accounts receivable, net | 194,300 | 190,756 | ||||||||
Merchandise inventories | 1,052,306 | 1,019,138 | ||||||||
Prepaid expense and other current assets | 63,454 | 81,972 | ||||||||
Prepaid federal and state income taxes | — | 9,784 | ||||||||
Total current assets | 1,337,206 | 1,336,604 | ||||||||
Property and equipment, net | 748,778 | 758,750 | ||||||||
Goodwill | 924,134 | 924,134 | ||||||||
Intangibles, net | 200,870 | 224,876 | ||||||||
Other assets | 28,297 | 29,492 | ||||||||
Total assets | $ | 3,239,285 | $ | 3,273,856 | ||||||
LIABILITIES | ||||||||||
Current liabilities: | ||||||||||
Current portion of long-term debt | $ | 254,377 | $ | 219,750 | ||||||
Accounts payable | 816,880 | 751,948 | ||||||||
Accrued expenses and other current liabilities | 504,834 | 495,767 | ||||||||
Accrued federal and state income taxes | 858 | — | ||||||||
Closed store obligations due within one year | 739 | 2,122 | ||||||||
Total current liabilities | 1,577,688 | 1,469,587 | ||||||||
Long-term debt | 1,546,471 | 2,492,660 | ||||||||
Noncurrent closed store obligations | 2,450 | 6,561 | ||||||||
Deferred income taxes | 36,937 | 57,074 | ||||||||
Other noncurrent liabilities | 277,823 | 267,393 | ||||||||
STOCKHOLDERS' DEFICIT | (202,084 | ) | (1,019,419 | ) | ||||||
Total liabilities and stockholders' deficit | $ | 3,239,285 | $ | 3,273,856 |
BJ'S WHOLESALE CLUB HOLDINGS, INC. | |||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||
(Amounts in thousands) | |||||||||
(Unaudited) | |||||||||
52 Weeks Ended February 2, 2019 | 53 Weeks Ended February 3, 2018 | ||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||
Net income | $ | 127,261 | $ | 50,301 | |||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
Charges for discontinued operations | (235 | ) | 2,766 | ||||||
Depreciation and amortization | 162,223 | 164,061 | |||||||
Amortization of debt issuance costs and accretion of original issues discount | 6,556 | 8,463 | |||||||
Debt extinguishment and refinancing charges | 23,602 | 9,788 | |||||||
Impairment charges for assets held for sale | 3,962 | — | |||||||
Other non-cash items, net | 2,362 | 3,892 | |||||||
Stock-based compensation expense | 57,677 | 9,102 | |||||||
Deferred income tax provision | (12,242 | ) | (35,623 | ) | |||||
Changes in operating assets and liabilities | |||||||||
Accounts receivable | (3,976 | ) | (24,507 | ) | |||||
Merchandise inventories | (33,168 | ) | 12,706 | ||||||
Accounts payable | 49,114 | 43,604 | |||||||
Accrued expenses | 21,485 | 23,241 | |||||||
Accrued income taxes | 10,642 | (12,651 | ) | ||||||
Other operating assets and liabilities, net | 11,840 | (45,058 | ) | ||||||
Net cash provided by operating activities | $ | 427,103 | $ | 210,085 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||
Additions to property and equipment, net of disposals | (145,913 | ) | (137,466 | ) | |||||
Net cash used in investing activities | $ | (145,913 | ) | $ | (137,466 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||
Proceeds from long term debt | $ | — | $ | 547,544 | |||||
Principal payments on long term debt | (36,167 | ) | (14,437 | ) | |||||
Paydown of First Lien Term Loan and extinguishment of Second Lien Term Loan | (975,633 | ) | — | ||||||
Net proceeds from ABL facility | 72,000 | 162,000 | |||||||
Debt issuance costs paid | (982 | ) | (24,635 | ) | |||||
Dividends paid | (25 | ) | (735,518 | ) | |||||
Net cash received (paid) from stock option exercises | (14,240 | ) | 858 | ||||||
Cash paid for share repurchases | — | (1,969 | ) | ||||||
Acquisition of treasury stock | (19,109 | ) | — | ||||||
Proceeds from Initial Public Offering, net of underwriters discount and commission | 690,970 | — | |||||||
Payment of Initial Public Offering costs | (5,081 | ) | — | ||||||
Other financing activities | (731 | ) | (3,472 | ) | |||||
Net cash used in financing activities | $ | (288,998 | ) | $ | (69,629 | ) | |||
Net decrease in cash and cash equivalents | (7,808 | ) | 2,990 | ||||||
Cash and cash equivalents at beginning of period | 34,954 | 31,964 | |||||||
Cash and cash equivalents at end of period | $ | 27,146 | $ | 34,954 |
BJ'S WHOLESALE CLUB HOLDINGS, INC. | ||||||||||||||||
Reconciliation of net income to adjusted net income and adjusted net income per diluted share | ||||||||||||||||
(Amounts in thousands, except per share amounts) | ||||||||||||||||
(Unaudited) | ||||||||||||||||
13 Weeks Ended February 2, 2019 | 14 Weeks Ended February 3, 2018 | 52 Weeks Ended February 2, 2019 | 53 Weeks Ended February 3, 2018 | |||||||||||||
Net income as reported | $ | 64,307 | $ | 66,708 | $ | 127,261 | $ | 50,301 | ||||||||
Adjustments | ||||||||||||||||
Stock-based compensation related to IPO (a) | — | — | 48,927 | — | ||||||||||||
Offering costs (b) | 660 | — | 3,803 | — | ||||||||||||
Management fees (c) | — | 1,965 | 3,333 | 8,038 | ||||||||||||
Charges incurred in the 2017 dividend recapitalization (d) | — | — | — | 21,061 | ||||||||||||
Compensatory payments related to options (e) | — | — | — | 77,953 | ||||||||||||
Club asset impairment (f) | — | — | 3,962 | — | ||||||||||||
Charges related to extinguishing Second Lien Term Loan (g) | — | — | 19,159 | — | ||||||||||||
Interest and amortization on Second Lien Term Loan (h) | — | 15,427 | 24,341 | 57,225 | ||||||||||||
Charges and write-offs related to 2018 debt refinancings (i) | — | — | 6,240 | — | ||||||||||||
Windfall tax benefit from stock exercises (j) | (2,676 | ) | — | (20,029 | ) | — | ||||||||||
Voluntary retirement severance (k) | — | 9,065 | — | 9,065 | ||||||||||||
Net tax benefit related to U.S. Tax Reform (l) | — | (32,081 | ) | — | (32,081 | ) | ||||||||||
Tax impact of adjustments to net income (m) | (185 | ) | (10,451 | ) | (30,844 | ) | (68,470 | ) | ||||||||
Adjusted net income | $ | 62,106 | $ | 50,633 | $ | 186,153 | $ | 123,092 | ||||||||
Weighted average fully diluted shares outstanding | 139,708 | 93,514 | 121,135 | 92,264 | ||||||||||||
Fully diluted shares outstanding at February 2, 2019 | 139,708 | 139,708 | 139,708 | 139,708 | ||||||||||||
Adjusted net income per diluted share (n) | $ | 0.44 | $ | 0.36 | $ | 1.33 | $ | 0.88 |
(a) | Represents one-time stock-based compensation expense for certain restricted stock and stock option awards issued in connection with our IPO. |
(b) | Represents one-time costs related to our IPO, secondary offering and other shareholder related filings. |
(c) | Represents management fees paid to our sponsors (or advisory affiliates thereof) in accordance with our management services agreement, which terminated upon closing of the IPO. |
(d) | Represents the write-off of certain deferred financing charges and other amounts in connection with the 2017 dividend recapitalization. |
(e) | Represents payments to holders of our stock options made pursuant to antidilutive provisions in connection with dividends paid to our shareholders. |
(f) | Represents the impairment charges related to a club relocated in 2018. |
(g) | Represents the write-off of certain deferred financing charges and a prepayment penalty associated with the payoff of our second lien term loan. |
(h) | Represents the historical interest expense associated with the second lien term loan that was paid in full with proceeds from our IPO. |
(i) | Represents fees and the write-off of deferred fees associated with the repricing of the Company’s first lien term loan and ABL facility. |
(j) | Represents the windfall tax benefit to the Company due to the exercise of stock options in connection with the secondary offering and of certain stock options by former employees of the Company. |
(k) | Represents termination costs associated with our voluntary retirement packages issued in January 2018. |
(l) | Represents the impact of the estimated benefit related to the remeasurement of net deferred tax liabilities as a result of U.S. tax reform enacted in December 2017. |
(m) | Represents the tax effect of the above adjustments at an effective tax rate of approximately 28%, as applicable. |
(n) | Adjusted net income per diluted share is measured using the fully diluted shares outstanding at February 2, 2019 of 139.7 million shares for all periods presented. |
BJ'S WHOLESALE CLUB HOLDINGS, INC. | ||||||||||||||||
RECONCILIATION OF ADJUSTED EBITDA | ||||||||||||||||
(Amounts in thousands) | ||||||||||||||||
(Unaudited) | ||||||||||||||||
13 Weeks Ended | 14 Weeks Ended | 52 Weeks Ended | 53 Weeks Ended | |||||||||||||
February 2, 2019 | February 3, 2018 | February 2, 2019 | February 3, 2018 | |||||||||||||
Income from continuing operations | $ | 63,713 | $ | 68,074 | $ | 127,092 | $ | 51,975 | ||||||||
Interest expense, net | 26,748 | 46,513 | 164,535 | 196,724 | ||||||||||||
Provision (benefit) for income taxes | 19,421 | (21,852 | ) | 11,826 | (28,427 | ) | ||||||||||
Depreciation and amortization | 39,789 | 40,657 | 162,223 | 164,061 | ||||||||||||
Compensatory payments related to options (a) | — | — | — | 77,953 | ||||||||||||
Stock-based compensation expense (b) | 2,932 | 1,453 | 58,917 | 9,102 | ||||||||||||
Preopening expenses (c) | 2,053 | 848 | 6,118 | 3,004 | ||||||||||||
Management fees (d) | — | 1,965 | 3,333 | 8,038 | ||||||||||||
non-cash rent (e ) | 1,273 | 1,010 | 4,864 | 5,391 | ||||||||||||
Strategic consulting (f) | 10,917 | 5,914 | 33,486 | 30,316 | ||||||||||||
Severance (g) | — | 9,065 | 960 | 9,065 | ||||||||||||
Offering costs (h) | 660 | — | 3,803 | — | ||||||||||||
Other adjustments (i) | (2,137 | ) | 4,351 | 1,269 | 6,305 | |||||||||||
Adjusted EBITDA | $ | 165,369 | $ | 157,998 | $ | 578,426 | $ | 533,507 |
(a) | Represents payments to holders of our stock options made pursuant to antidilutive provisions in connection with dividends paid to our shareholders. |
(b) | Represents total stock-based compensation expense and includes one-time expense related to certain restricted stock and stock option awards issued in connection with our IPO. |
(c) | Represents direct incremental costs of opening or relocating a facility that are charged to operations as incurred. |
(d) | Represents management fees paid to our sponsors (or advisory affiliates thereof) in accordance with our management services agreement, which terminated upon closing of the IPO. |
(e) | Consists of an adjustment to remove the non-cash portion of rent expense, which has been recorded on a straight-line basis in accordance with GAAP. |
(f) | Represents fees paid to external consultants for strategic initiatives of limited duration. |
(g) | Represents termination costs to a former executive and termination costs associated with our voluntary retirement packages issued in January 2018. |
(h) | Represents one-time costs related to our IPO, secondary offering and other shareholder related filings. |
(i) | Other non-cash items, including amortization of a deferred gain from sale lease back transactions in 2013, non-cash accretion on asset retirement obligations, obligations associated with our post-retirement medical plan, impairment charges related to a club that was relocated in 2018 and a gain from a third party settlement. |
BJ'S WHOLESALE CLUB HOLDINGS, INC. | ||||||||
Reconciliation of GAAP to Non-GAAP Financial Measures | ||||||||
Fiscal Year 2019 Outlook for Adjusted EBITDA | ||||||||
(Amounts in millions) | ||||||||
(Unaudited) | ||||||||
Fiscal Year 2019 Outlook | ||||||||
Low End | High End | |||||||
Income from continuing operations | $ | 200 | $ | 212 | ||||
Interest expense, net | 110 | 105 | ||||||
Provision (benefit) for income taxes | 67 | 70 | ||||||
Depreciation and amortization | 165 | 165 | ||||||
Stock Based Compensation | 20 | 20 | ||||||
Preopening expenses (a) | 12 | 12 | ||||||
non-cash rent (b) | 4 | 4 | ||||||
Strategic consulting (c) | 12 | 12 | ||||||
Adjusted EBITDA | $ | 590 | $ | 600 |
(a) | Represents direct incremental costs of opening or relocating a facility that are charged to operations as incurred. |
(b) | Consists of an adjustment to remove the non-cash portion of rent expense. |
(c) | Represents fees paid to external consultants for strategic initiatives of limited duration. |