BOOT
$31.06
Boot Barn Holdings
$.57
1.87%
Earnings Details
1st Quarter June 2019
Wednesday, July 31, 2019 4:10:00 PM
Tweet Share Watch
Summary

Boot Barn Holdings Beats

Boot Barn Holdings (BOOT) reported 1st Quarter June 2019 earnings of $0.32 per share on revenue of $185.8 million. The consensus earnings estimate was $0.21 per share on revenue of $179.7 million. The Earnings Whisper number was $0.21 per share. Revenue grew 14.7% on a year-over-year basis.

The company said it expects second quarter earnings of $0.17 to $0.19 per share on revenue of $182.0 million to $184.0 million. The current consensus earnings estimate is $0.16 per share on revenue of $184.3 million for the quarter ending September 30, 2019. The company also said it expects fiscal 2020 earnings of $1.57 to $1.65 per share. The company's previous guidance was earnings of $1.42 to $1.50 per share and the current consensus earnings estimate is $1.52 per share for the year ending March 31, 2020.

Boot Barn Holdings Inc operates specialty retail stores that sell western and work boots and related apparel and accessories. It operates retail locations throughout the U.S. and sells its merchandise via the Internet.

Results
Reported Earnings
$0.32
Earnings Whisper
$0.21
Consensus Estimate
$0.21
Reported Revenue
$185.8 Mil
Revenue Estimate
$179.7 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Boot Barn Holdings, Inc. Announces First Quarter Fiscal Year 2020 Financial Results and Increased Annual Guidance

IRVINE, Calif.--(BUSINESS WIRE)--Boot Barn Holdings, Inc. (NYSE: BOOT) today announced its financial results for the first fiscal quarter ended June 29, 2019.

Highlights for the quarter ended June 29, 2019, were as follows:

  • Net sales increased 14.7% to $185.8 million.
  • Same store sales increased 9.4%, including an increase in retail store same store sales of 11.1% and an increase in e-commerce sales of 0.9%.
  • Net income was $9.7 million, or $0.33 per diluted share, compared to $6.8 million, or $0.24 per diluted share in the prior-year period. Net income per diluted share in the current-year period includes $0.01 per share of tax benefit from the exercise of stock options compared to $0.09 per share of tax benefit from the exercise of stock options in the prior-year period. Excluding the tax benefit in both years, net income per diluted share in the current-year period grew 113% to $0.32, compared to $0.15 in the prior-year period.

Jim Conroy, Chief Executive Officer, commented, “The underlying strength in the business has continued as evidenced by our strong start to fiscal 2020. First quarter same store sales grew 9.4% driven by a double-digit retail store comp increase, marking the ninth consecutive quarter of positive gains at our physical locations. At the same time, increases in full-price selling and exclusive brand penetration helped fuel a 150 basis point improvement in merchandise margin, which along with SG&A leverage, resulted in significant operating margin expansion. Importantly, we’ve experienced strength across virtually all geographies and merchandise categories and this momentum has continued into the start of the second quarter with same store sales up high-single digits in July, despite eliminating our long-standing anniversary sale in the current year.”

Operating Results for the First Quarter Ended June 29, 2019

  • Net sales increased 14.7% to $185.8 million from $162.0 million in the prior-year period. Consolidated same store sales increased 9.4%. Excluding the impact of the 0.9% increase in e-commerce same store sales, same store sales increased by 11.1%. The increase in net sales was driven by the increase in same store sales, sales from new stores added over the past twelve months and the sales contribution from acquired stores.
  • Gross profit was $62.2 million, or 33.5% of net sales, compared to $51.4 million, or 31.8% of net sales, in the prior-year period. Gross profit increased primarily due to increased sales and an increase in merchandise margin rate. Gross profit rate increased due to a 150 basis point increase in merchandise margin rate and 20 basis points of leverage in buying and occupancy costs. The higher merchandise margin was driven by better full-price selling and growth in exclusive brand penetration.
  • Selling, general and administrative expense was $46.1 million, or 24.8% of net sales, compared to $41.6 million, or 25.7% of net sales, in the prior-year period. The increase in selling, general and administrative expenses was primarily a result of additional costs to support higher sales and expenses for both new and acquired stores. Selling, general and administrative expenses as a percentage of sales decreased by 90 basis points as a result of expense leverage on higher sales.
  • Income from operations grew 63.4% to $16.1 million, or 8.6% of net sales, compared to $9.8 million, or 6.1% of net sales, in the prior-year period. This increase represents approximately 260 basis points of improvement in operating profit margin.
  • Net income was $9.7 million, or $0.33 per diluted share, compared to $6.8 million, or $0.24 per diluted share in the prior-year period. Net income per diluted share in the current-year period includes $0.01 per share of tax benefit from the exercise of stock options compared to $0.09 per share of tax benefit from the exercise of stock options in the prior-year period. Excluding the tax benefit in both years, net income per diluted share in the current-year period grew 113% to $0.32, compared to $0.15 in the prior-year period.

Balance Sheet Highlights as of June 29, 2019

  • Cash of $22.7 million.
  • Average inventory per store was up 9.2% on a same store basis compared to June 30, 2018.
  • Total net debt of $188.5 million, including an $80.0 million balance under the revolving credit facility.

Fiscal Year 2020 Outlook

For the fiscal year ending March 28, 2020 the Company now expects:

  • To open or acquire 25 stores, including stores opened fiscal year-to-date.
  • Same store sales growth of approximately 6.0%, compared to the Company’s prior outlook of 5.0%.
  • Income from operations of $75.4 million to $78.6 million, compared to the Company’s prior outlook of $71.5 million to $74.4 million.
  • Interest expense of approximately $14.2 million, compared to the Company’s prior outlook of $15.5 million.
  • Net income of $46.2 million to $48.5 million, compared to the Company’s prior outlook of $41.7 million to $44.0 million.
  • Net income per diluted share of $1.57 to $1.65 based on 29.4 million weighted average diluted shares outstanding, compared to the Company’s prior outlook of $1.42 to $1.50.

For the fiscal second quarter ending September 28, 2019, the Company expects:

  • Same store sales growth of approximately 7.0%.
  • Total sales of $182.0 million to $184.0 million.
  • Net income per diluted share of $0.17 to $0.19 based on 29.3 million weighted average diluted shares outstanding.

Conference Call Information

A conference call to discuss the financial results for the first quarter of fiscal year 2020 is scheduled for today, July 31, 2019, at 4:30 p.m. ET (1:30 p.m. PT). Investors and analysts interested in participating in the call are invited to dial (800) 289-0438. The conference call will also be available to interested parties through a live webcast at investor.bootbarn.com. Please visit the website and select the “Events and Presentations” link at least 15 minutes prior to the start of the call to register and download any necessary software. A telephone replay of the call will be available until August 31, 2019, by dialing (844) 512-2921 (domestic) or (412) 317-6671 (international) and entering the conference identification number: 3916127. Please note participants must enter the conference identification number in order to access the replay.

About Boot Barn

Boot Barn is the nation’s leading lifestyle retailer of western and work-related footwear, apparel and accessories for men, women and children. The Company offers its loyal customer base a wide selection of work and lifestyle brands. As of the date of this release, Boot Barn operates 240 stores in 33 states, in addition to an e-commerce channel www.bootbarn.com. The Company also operates www.sheplers.com, the nation’s leading pure play online western and work retailer and www.countryoutfitter.com, an e-commerce site selling to customers who live a country lifestyle. For more information, call 888-Boot-Barn or visit www.bootbarn.com.

Forward Looking Statements

This press release contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact included in this press release are forward-looking statements. Forward-looking statements refer to our current expectations and projections relating to, by way of example and without limitation, our financial condition, liquidity, profitability, results of operations, margins, plans, objectives, strategies, future performance, business and industry. 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”, “might”, “will”, “could”, “should”, “can have”, “likely”, “outlook” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events, but not all forward-looking statements contain these identifying words. These forward-looking statements are based on assumptions that the Company’s management has made in light of their industry experience and on their perceptions of historical trends, current conditions, expected future developments and other factors they believe are appropriate under the circumstances. As you consider this press release, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties (some of which are beyond the Company’s control) and assumptions. These risks, uncertainties and assumptions include, but are not limited to, the following: decreases in consumer spending due to declines in consumer confidence, local economic conditions or changes in consumer preferences; the Company’s ability to effectively execute on its growth strategy; and the Company’s failure to maintain and enhance its strong brand image, to compete effectively, to maintain good relationships with its key suppliers, and to improve and expand its exclusive product offerings. The Company discusses the foregoing risks and other risks in greater detail under the heading “Risk factors” in the periodic reports filed by the Company with the Securities and Exchange Commission. Although the Company believes that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect the Company’s actual financial results and cause them to differ materially from those anticipated in the forward-looking statements. Because of these factors, the Company cautions that you should not place undue reliance on any of these forward-looking statements. New risks and uncertainties arise from time to time, and it is impossible for the Company to predict those events or how they may affect the Company. Further, any forward-looking statement speaks only as of the date on which it is made. Except as required by law, the Company does not intend to update or revise the forward-looking statements in this press release after the date of this press release.

 

Boot Barn Holdings, Inc.
Consolidated Balance Sheets
(In thousands, except per share data)
(Unaudited)

June 29,March 30,

2019

2019

Assets
Current assets:
Cash and cash equivalents

$

22,739

$

16,614

Accounts receivable, net

6,552

8,095

Inventories

253,895

240,734

Prepaid expenses and other current assets

12,889

11,900

Total current assets

296,075

277,343

Property and equipment, net

93,733

98,663

Right-of-use assets, net

162,702

Goodwill

195,858

195,858

Intangible assets, net

60,769

62,845

Other assets

1,464

1,366

Total assets

$

810,601

$

636,075

Liabilities and stockholders’ equity
Current liabilities:
Line of credit

$

80,001

$

Accounts payable

99,471

104,955

Accrued expenses and other current liabilities

48,852

46,988

Right-of-use liabilities, current

30,830

Total current liabilities

259,154

151,943

Deferred taxes

16,155

17,202

Long-term portion of notes payable, net

108,464

174,264

Capital lease obligation

6,746

Right-of-use liabilities, non-current

146,638

Other liabilities

4,495

21,756

Total liabilities

534,906

371,911

 
Stockholders’ equity:
Common stock, $0.0001 par value; June 29, 2019 - 100,000 shares authorized, 28,542 shares issued; March 30, 2019 - 100,000 shares authorized, 28,399 shares issued

3

3

Preferred stock, $0.0001 par value; 10,000 shares authorized, no shares issued or outstanding
Additional paid-in capital

161,369

159,137

Retained earnings

115,413

105,692

Less: Common stock held in treasury, at cost, 66 and 51 shares at June 29, 2019 and March 30, 2019, respectively

(1,090)

(668)

Total stockholders’ equity

275,695

264,164

Total liabilities and stockholders’ equity

$

810,601

$

636,075

 
 
 

Boot Barn Holdings, Inc.
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)

Thirteen Weeks Ended
June 29,June 30,

2019

2018

Net sales

$

185,767

$

161,984

Cost of goods sold

123,611

110,537

Gross profit

62,156

51,447

Selling, general and administrative expenses

46,095

41,618

Income from operations

16,061

9,829

Interest expense, net

3,904

4,100

Other income, net

11

Income before income taxes

12,168

5,729

Income tax expense/(benefit)

2,447

(1,032)

Net income

$

9,721

$

6,761

 
Earnings per share:
Basic shares

$

0.34

$

0.24

Diluted shares

$

0.33

$

0.24

Weighted average shares outstanding:
Basic shares

28,380

27,604

Diluted shares

29,025

28,542

 

Boot Barn Holdings, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)

 
Thirteen Weeks Ended
June 29,June 30,

2019

 

2018

Cash flows from operating activities
Net income

$

9,721

$

6,761

Adjustments to reconcile net income to net cash (used in)/provided by operating activities:
Depreciation

4,770

4,238

Stock-based compensation

965

612

Amortization of intangible assets

32

193

Amortization of ROU assets

7,424

Amortization of debt issuance fees and debt discount

281

305

Loss on disposal of property and equipment

12

Gain on adjustment of ROU asset and liability

(193)

Store impairment charge

213

Deferred taxes

(1,047)

394

Changes in operating assets and liabilities, net of acquisition:
Accounts receivable, net

1,612

(1,051)

Inventories

(13,161)

8,910

Prepaid expenses and other current assets

(867)

(1,245)

Other assets

(274)

(14)

Accounts payable

(6,486)

(13,468)

Accrued expenses and other current liabilities

2,719

(745)

Other liabilities

249

403

Operating leases

(7,306)

Net cash (used in)/provided by operating activities

$

(1,549)

$

5,506

Cash flows from investing activities
Purchases of property and equipment

$

(6,822)

$

(7,064)

Acquisition of business, net of cash acquired

(4,424)

Net cash used in investing activities

$

(6,822)

$

(11,488)

Cash flows from financing activities
Borrowings on line of credit - net

$

80,001

$

9,731

Repayments on debt and finance lease obligations

(65,147)

(10,123)

Debt issuance fees paid

(1,203)

Tax withholding payments for net share settlement

(422)

(306)

Proceeds from the exercise of stock options

1,267

5,038

Net cash provided by financing activities

$

14,496

$

4,340

 
Net increase/(decrease) in cash and cash equivalents

6,125

(1,642)

Cash and cash equivalents, beginning of period

16,614

9,016

Cash and cash equivalents, end of period

$

22,739

$

7,374

 
Supplemental disclosures of cash flow information:
Cash paid for income taxes

$

201

$

240

Cash paid for interest

$

3,370

$

3,769

Supplemental disclosure of non-cash activities:
Unpaid purchases of property and equipment

$

2,879

$

2,559

 

Boot Barn Holdings, Inc.
Store Count

  
Fiscal Year EndedFiscal Year EndedFiscal Year Ended Quarter Ended
April 1,March 31, March 30, June 29,

2017

 

2018

 

2019

 

2019

Store Count (BOP)

208

219

226

 

240

Opened/Acquired

12

9

17

 

1

Closed Boot Barn Stores

(1)

(2)

(3)

 

(1)

Store Count (EOP)

219

226

240

 

240

  
     
Thirteen Weeks Ended
June 29,
2019
 March 30,
2019
 December 29,
2018
 September 29,
2018
 June 30,
2018
Boot Barn's Net Income

$

9,721

 

$

8,697

 

$

19,030

 

$

4,534

 

$

6,761

Income tax expense/(benefit)

2,447

 

3,736

 

6,260

 

10

 

(1,032)

Interest expense, net

3,904

 

4,067

 

4,011

 

4,153

 

4,100

Depreciation and intangible asset amortization (a)

4,802

 

5,178

 

4,720

 

4,573

 

4,431

Boot Barn's EBITDA

$

20,874

 

$

21,678

 

$

34,021

 

$

13,270

 

$

14,260

     
Non-cash stock-based compensation (b)

$

965

 

$

666

 

$

791

 

$

804

 

$

612

Non-cash accrual for future award redemptions (c)

97

 

(73)

 

526

 

92

 

22

Loss/(gain) on disposal of assets (d)

12

 

-

 

(4)

 

27

 

-

Gain on adjustment of ROU asset and liability (e)

(193)

 

-

 

-

 

-

 

-

Store impairment charge (f)

-

 

-

 

150

 

92

 

213

Secondary offering costs (g)

-

 

-

 

-

 

-

 

176

Boot Barn's Adjusted EBITDA

$

21,755

 

$

22,271

 

$

35,484

 

$

14,285

 

$

15,283

     
Additional adjustments (h)

847

 

1,059

 

455

 

553

 

935

Consolidated EBITDA per Loan Agreements

$

22,602

 

$

23,330

 

$

35,939

 

$

14,838

 

$

16,218

     

(a)

The thirteen weeks ended June 29, 2019 excludes below-market lease amortization and certain asset depreciation expenses no longer recorded as amortization expense, but rent expense under ASC 842.

(b)

Represents non-cash compensation expenses related to stock options, restricted stock awards and restricted stock units granted to certain of our employees and directors.

(c)

Represents the non-cash accrual for future award redemptions in connection with our customer loyalty program.

(d)

Represents loss/(gain) on disposal of assets from store closures.

(e)

Represents a gain on adjustment of a ROU asset and liability.

(f)

Represents store impairment charges recorded in order to reduce the carrying amount of the assets to their estimated fair values.

(g) 

Represents professional fees and expenses incurred in connection with the May 2018 secondary offering.

(h) 

Adjustments to Boot Barn's Adjusted EBITDA as provided in the 2015 Golub Term Loan and June 2015 Wells Fargo Revolver include pre-opening costs, franchise and state taxes, and other miscellaneous adjustments. Beginning in the thirteen weeks ended June 29, 2019, adjustments also include below-market lease amortization and certain asset depreciation expenses no longer recorded as amortization expense, but rent expense under ASC 842.

 

Investors:
ICR, Inc.
Brendon Frey, 203-682-8216
BootBarnIR@icrinc.com

or

Media:
Boot Barn Holdings, Inc.
Jim Watkins, 949-453-4428
Vice President, Investor Relations
BootBarnIRMedia@bootbarn.com

Source: Boot Barn Holdings, Inc.