NEVADA (State or Other Jurisdiction of Incorporation) | 91-1826900 (I.R.S. Employer Identification No.) |
2425 West Loop South, Houston, Texas (Address of Principal Executive Offices) | 77027 (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common Stock ($0.01 par value) | SSI | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). | |
Emerging growth company | o |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | o |
STAGE STORES, INC. | |
Date: August 26, 2019 | /s/ Jason T. Curtis |
Jason T. Curtis | |
Executive Vice President, | |
Chief Financial Officer and Treasurer |
• | Net sales were $368 million compared to $369 million |
• | Comparable sales increased 1.8% for total company, with off-price conversions benefiting comparable sales by 150 basis points |
• | Net loss was $23.9 million compared to net loss of $16.9 million |
• | Loss per share was $0.83 compared to loss per share of $0.60 |
• | Adjusted EBITDA was $(0.1) million compared to adjusted EBITDA of $2.0 million |
• | Opened one new Gordmans off-price store and converted 35 department stores to Gordmans off-price, bringing the year to date conversion total to 72 |
• | Net sales between $1,555 million and $1,585 million |
• | Comparable sales increase of 1% to 3% |
• | Adjusted EBITDA between $20 million and $25 million |
• | Net loss between $65 million and $60 million, and tax rate of 0% |
• | Loss per share between $2.25 and $2.10 |
• | Convert 89 department stores to Gordmans off-price stores, open one new Gordmans stores, and close 55 to 60 department stores |
• | Capital expenditures of $30 million |
Three Months Ended | |||||||||||||
August 3, 2019 | August 4, 2018 | ||||||||||||
Amount | % to Sales (a) | Amount | % to Sales (a) | ||||||||||
Net sales | $ | 367,865 | 100.0 | % | $ | 369,294 | 100.0 | % | |||||
Credit income | 13,988 | 3.8 | % | 14,305 | 3.9 | % | |||||||
Total revenues | 381,853 | 103.8 | % | 383,599 | 103.9 | % | |||||||
Cost of sales and related buying, occupancy and distribution expenses | 295,204 | 80.2 | % | 286,807 | 77.7 | % | |||||||
Selling, general and administrative expenses | 106,310 | 28.9 | % | 110,914 | 30.0 | % | |||||||
Interest expense | 4,123 | 1.1 | % | 2,650 | 0.7 | % | |||||||
Loss before income tax | (23,784 | ) | (6.5 | )% | (16,772 | ) | (4.5 | )% | |||||
Income tax expense | 150 | — | % | 150 | — | % | |||||||
Net loss | $ | (23,934 | ) | (6.5 | )% | $ | (16,922 | ) | (4.6 | )% | |||
Loss per share: | |||||||||||||
Basic | $ | (0.83 | ) | $ | (0.60 | ) | |||||||
Diluted | $ | (0.83 | ) | $ | (0.60 | ) | |||||||
Weighted average shares outstanding: | |||||||||||||
Basic | 28,791 | 28,152 | |||||||||||
Diluted | 28,791 | 28,152 | |||||||||||
(a) Percentages may not foot due to rounding. |
Six Months Ended | |||||||||||||
August 3, 2019 | August 4, 2018 | ||||||||||||
Amount | % to Sales (a) | Amount | % to Sales (a) | ||||||||||
Net sales | $ | 695,586 | 100.0 | % | $ | 713,523 | 100.0 | % | |||||
Credit income | 27,096 | 3.9 | % | 29,819 | 4.2 | % | |||||||
Total revenues | 722,682 | 103.9 | % | 743,342 | 104.2 | % | |||||||
Cost of sales and related buying, occupancy and distribution expenses | 572,803 | 82.3 | % | 568,548 | 79.7 | % | |||||||
Selling, general and administrative expenses | 212,886 | 30.6 | % | 218,191 | 30.6 | % | |||||||
Interest expense | 8,117 | 1.2 | % | 4,903 | 0.7 | % | |||||||
Loss before income tax | (71,124 | ) | (10.2 | )% | (48,300 | ) | (6.8 | )% | |||||
Income tax expense | 300 | — | % | 300 | — | % | |||||||
Net loss | $ | (71,424 | ) | (10.3 | )% | $ | (48,600 | ) | (6.8 | )% | |||
Loss per share: | |||||||||||||
Basic | $ | (2.50 | ) | $ | (1.74 | ) | |||||||
Diluted | $ | (2.50 | ) | $ | (1.74 | ) | |||||||
Weighted average shares outstanding: | |||||||||||||
Basic | 28,616 | 27,959 | |||||||||||
Diluted | 28,616 | 27,959 | |||||||||||
(a) Percentages may not foot due to rounding. |
August 3, 2019 | February 2, 2019 | August 4, 2018 | |||||||||
ASSETS | |||||||||||
Cash and cash equivalents | $ | 25,418 | $ | 15,830 | $ | 26,573 | |||||
Merchandise inventories, net | 499,001 | 424,555 | 476,883 | ||||||||
Prepaid expenses and other current assets | 50,138 | 52,518 | 48,525 | ||||||||
Total current assets | 574,557 | 492,903 | 551,981 | ||||||||
Property, equipment and leasehold improvements, net | 201,928 | 224,803 | 236,151 | ||||||||
Operating lease assets | 321,982 | — | — | ||||||||
Intangible assets | 2,225 | 2,225 | 17,135 | ||||||||
Other non-current assets, net | 21,354 | 24,230 | 24,409 | ||||||||
Total assets | $ | 1,122,046 | $ | 744,161 | $ | 829,676 | |||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
Accounts payable | $ | 155,865 | $ | 106,825 | $ | 122,680 | |||||
Current portion of debt obligations | 5,000 | 4,812 | 3,542 | ||||||||
Current portion of operating lease liabilities | 74,906 | — | — | ||||||||
Accrued expenses and other current liabilities | 76,455 | 65,715 | 73,506 | ||||||||
Total current liabilities | 312,226 | 177,352 | 199,728 | ||||||||
Long-term debt obligations | 318,775 | 250,294 | 268,682 | ||||||||
Long-term operating lease liabilities | 279,009 | — | — | ||||||||
Other long-term liabilities | 32,213 | 61,990 | 65,431 | ||||||||
Total liabilities | 942,223 | 489,636 | 533,841 | ||||||||
Commitments and contingencies | |||||||||||
Common stock, par value $0.01, 100,000 shares authorized, 34,052, 33,469 and 33,418 shares issued, respectively | 341 | 335 | 334 | ||||||||
Additional paid-in capital | 425,033 | 423,535 | 421,621 | ||||||||
Treasury stock, at cost, 5,175 shares, respectively | (43,546 | ) | (43,579 | ) | (43,388 | ) | |||||
Accumulated other comprehensive loss | (5,485 | ) | (5,857 | ) | (4,823 | ) | |||||
Accumulated deficit | (196,520 | ) | (119,909 | ) | (77,909 | ) | |||||
Total stockholders' equity | 179,823 | 254,525 | 295,835 | ||||||||
Total liabilities and stockholders' equity | $ | 1,122,046 | $ | 744,161 | $ | 829,676 | |||||
Six Months Ended | |||||||
August 3, 2019 | August 4, 2018 | ||||||
Cash flows from operating activities: | |||||||
Net loss | $ | (71,424 | ) | $ | (48,600 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Depreciation and amortization of long-lived assets | 29,872 | 30,147 | |||||
Impairment of long-lived assets | 1,615 | 1,070 | |||||
(Gain) loss on retirements of property, equipment and leasehold improvements | (678 | ) | 17 | ||||
Non-cash operating lease expense | 34,919 | — | |||||
Stock-based compensation expense | 1,585 | 3,049 | |||||
Dividends charged to compensation expense | 21 | — | |||||
Amortization of debt issuance costs | 341 | 148 | |||||
Deferred compensation obligation | (33 | ) | 90 | ||||
Amortization of employee benefit related costs | 372 | 354 | |||||
Construction allowances from landlords | 3,553 | 757 | |||||
Other changes in operating assets and liabilities: | |||||||
Increase in merchandise inventories | (74,446 | ) | (38,506 | ) | |||
Decrease in other assets | 8,464 | 2,412 | |||||
Decrease in operating lease liabilities | (37,601 | ) | — | ||||
Increase (decrease) in accounts payable and other liabilities | 61,788 | (19,958 | ) | ||||
Net cash used in operating activities | (41,652 | ) | (69,020 | ) | |||
Cash flows from investing activities: | |||||||
Additions to property, equipment and leasehold improvements | (18,610 | ) | (12,822 | ) | |||
Proceeds from insurance and disposal of assets | 678 | 1,802 | |||||
Net cash used in investing activities | (17,932 | ) | (11,020 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from revolving credit facility borrowings | 257,426 | 298,509 | |||||
Payments of revolving credit facility borrowings | (186,445 | ) | (233,148 | ) | |||
Proceeds from long-term debt obligation | — | 25,000 | |||||
Payments of long-term debt obligations | (1,758 | ) | (1,472 | ) | |||
Payments of debt issuance costs | (36 | ) | (354 | ) | |||
Payments for stock related compensation | (15 | ) | (260 | ) | |||
Cash dividends paid | — | (2,912 | ) | ||||
Net cash provided by financing activities | 69,172 | 85,363 | |||||
Net increase in cash and cash equivalents | 9,588 | 5,323 | |||||
Cash and cash equivalents: | |||||||
Beginning of period | 15,830 | 21,250 | |||||
End of period | $ | 25,418 | $ | 26,573 |
Three Months Ended | Six Months Ended | ||||||||||||||
August 3, 2019 | August 4, 2018 | August 3, 2019 | August 4, 2018 | ||||||||||||
Net loss (GAAP) | $ | (23,934 | ) | $ | (16,922 | ) | $ | (71,424 | ) | $ | (48,600 | ) | |||
Interest expense | 4,123 | 2,650 | 8,117 | 4,903 | |||||||||||
Income tax expense | 150 | 150 | 300 | 300 | |||||||||||
Depreciation and amortization | 14,528 | 14,997 | 29,872 | 30,147 | |||||||||||
EBITDA (non-GAAP) | (5,133 | ) | 875 | (33,135 | ) | (13,250 | ) | ||||||||
Impairment of long-lived assets | 1,096 | 1,070 | 1,615 | 1,070 | |||||||||||
Severance | 1,467 | 72 | 2,503 | 119 | |||||||||||
Pre-opening expenses | 1,295 | — | 2,897 | — | |||||||||||
Store closing services | 1,178 | — | 1,178 | — | |||||||||||
Adjusted EBITDA (non-GAAP) | $ | (97 | ) | $ | 2,017 | $ | (24,942 | ) | $ | (12,061 | ) |
Fiscal 2019 | |||||||
Low | High | ||||||
Net loss (GAAP) | $ | (65 | ) | $ | (60 | ) | |
Interest expense | 16 | 16 | |||||
Income tax expense | 1 | 1 | |||||
Depreciation and amortization | 58 | 58 | |||||
EBITDA (non-GAAP) | 10 | 15 | |||||
Impairments, severance, pre-opening and store closing services | 10 | 10 | |||||
Adjusted EBITDA (non-GAAP) | $ | 20 | $ | 25 |