PLANO, Texas, Jan. 9, 2017 /PRNewswire/ -- At Home Group Inc. (NYSE: HOME), the home décor superstore, today announced that it expects net sales for the fiscal year ending January 28, 2017 to increase approximately 22% to a range of $758 million to $761 million, including a comparable store sales increase of 3.0% to 3.2%. At Home's fiscal 2017 EPS outlook has narrowed to $0.44 to $0.46 compared to EPS of $0.07 in fiscal 2016, with its pro forma adjusted EPS1 outlook narrowing to $0.55 to $0.57 for an increase of 34% to 39% over prior year.
Lee Bird, President and Chief Executive Officer, stated: "We are pleased to be raising our sales and comp outlook for fiscal 2017 driven by our quarter-to-date business performance, putting us on track to deliver our 11th consecutive quarter of over 20% net sales growth and our 12th consecutive quarter of positive comparable store sales. We saw continued strength across both new and existing stores driven by the disciplined execution of our strategic priorities, particularly our merchandising initiatives, investments in incremental inventory and brand-building efforts. Our differentiated, value-oriented product offering continues to resonate with customers across our footprint, positioning us well to deliver on the significant long-term growth opportunity that exists for At Home."
Mr. Bird added, "We are also pleased to be narrowing our EPS range despite incurring costs related to higher incentive compensation and our decision to add incremental inventory, which we expect to be partially offset by a slightly lower tax rate and lower fully diluted share count than previously expected. We look forward to discussing our fourth quarter results and our outlook for fiscal 2018 on our earnings call in late March."
As previously announced, management will be meeting with analysts and investors and presenting at the ICR Conference in Orlando, Florida January 9-11, 2017. The audio portion of the presentation will be webcast live on January 10, 2017 at 9:30 a.m. Eastern. The webcast and related presentation can be found under News & Events at investor.athome.com. An archived replay will be available at investor.athome.com for approximately 90 days following the webcast.
1 Represents a non-GAAP financial measure. For additional information about non-GAAP measures, including reconciliations to the most directly comparable financial measures presented in accordance with GAAP, please see "Non-GAAP Measures" below. Projected pro forma adjusted net income excludes the following estimated pre-tax adjustments for fiscal 2017: a $2.7 million loss on extinguishment of debt from the use of IPO proceeds to repay our $130.0 million Second Lien Facility; $5.6 million in non-cash stock-based compensation related to a special one-time IPO bonus grant; $0.7 million of transaction related costs associated with our IPO; and a $6.1 million pro forma interest adjustment to normalize results for the impact of repaying our Second Lien Facility with IPO proceeds. Pro forma diluted weighted average shares outstanding for fiscal 2017 are expected to be in a range of 61.8 million to 62.3 million.
This release contains forward-looking statements. You can generally identify forward-looking statements by our use of forward-looking terminology such as "anticipate," "are confident," "assumed," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "on track," "plan," "position, " "potential," "predict," "seek," "should," or "vision," or the negative thereof or other variations thereon or comparable terminology. In particular, statements about our outlook and assumptions for financial performance for fiscal 2017, as well as statements about the markets in which we operate, expected new store openings, potential growth opportunities and future capital expenditures and our expectations, beliefs, plans, strategies, objectives, prospects, assumptions or future events or performance contained in this document are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors, including those discussed in our final prospectus, dated August 3, 2016, filed pursuant to Rule 424(b) under the Securities Act of 1933 with the SEC under the headings "Prospectus Summary," "Risk Factors," "Cautionary Note Regarding Forward-Looking Statements," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business," and in our quarterly reports on Form 10-Q and current reports on Form 8-K as well as future filings we may make with the SEC, may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements contained in this release are not guarantees of future performance and our actual results of operations, financial condition and liquidity, and the development of the industry in which we operate, may differ materially from the forward-looking statements contained herein. In addition, even if our results of operations, financial condition and liquidity, and events in the industry in which we operate, are consistent with the forward-looking statements contained in this prospectus, they may not be predictive of results or developments in future periods.
Any forward-looking statement that we make in this release speaks only as of the date of such statement. Except as required by law, we do not undertake any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this document.
We define certain terms used in this release as follows:
"comparable store sales" means, for any reporting period, the change in period-over-period net sales for the comparable store base, beginning with stores on the first day of the sixteenth full fiscal month following the store's opening. 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.
"EPS" means diluted earnings per share.
"GAAP" means accounting principles generally accepted in the United States.
"pro forma adjusted net income (loss)" means net income (loss) before certain one-time expenses associated with our IPO and non-cash stock-based compensation related to a special one-time IPO bonus grant, as well as loss on extinguishment of debt and as adjusted for comparability between periods to reflect the impact of interest on indebtedness repaid during the periods presented, the tax impact of adjustments to net income (loss) and normalization of income tax rates during the periods presented.
"pro forma adjusted EPS" means pro forma adjusted net income (loss) divided by pro forma diluted weighted average shares outstanding.
"pro forma diluted weighted average shares outstanding" means diluted share count on a pro forma basis after giving effect to the issuance of the shares of common stock in the IPO as if it had occurred at the beginning of the period presented.
Certain financial measures presented in this release, such as comparable store sales, pro forma adjusted net income, pro forma diluted weighted average shares outstanding and pro forma adjusted EPS are not recognized under GAAP.
We present comparable store sales, which is not a recognized financial measure under GAAP, because it allows us to evaluate how our store base is performing by measuring the change in period-over-period net sales in stores that have been open for the applicable period. We present pro forma adjusted net income, pro forma diluted weighted average shares outstanding and pro forma adjusted EPS because we believe investors' understanding of our operating performance is enhanced by the disclosure of net income and earnings per diluted share adjusted for nonrecurring charges associated with events such as our IPO and refinancing transactions.
You are encouraged to evaluate each of these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating our non-GAAP 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 such presentation. 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, comparable store sales, pro forma adjusted net income, pro forma diluted weighted average shares outstanding and pro forma adjusted EPS may not be comparable to similarly titled measures used by other companies.
Comparable store sales, pro forma adjusted net income, pro forma diluted weighted average shares outstanding and pro forma adjusted EPS have limitations as analytical tools and you should not consider them in isolation, or as a substitute for analysis of our results as reported under GAAP. We compensate for these limitations by relying primarily on our GAAP results and using comparable store sales, pro forma adjusted net income, pro forma diluted weighted average shares outstanding and pro forma adjusted EPS only as supplemental information.
About At Home Group Inc.
At Home, the home décor superstore, is focused on providing customers with the broadest assortment of home décor products to suit any style, any room, at any budget, for any reason to redecorate. With a wide assortment of 50,000 items throughout our stores, At Home enables customers to express themselves and create a home that reflects their personality and style. Our differentiated merchandising strategy allows us to identify trends and then value engineer products to provide the aesthetics our customers want at attractive price points. Our highly efficient operating model seeks to drive growth and profitability while minimizing operating risk, ultimately allowing us to deliver exceptional value to our customers. We utilize a flexible and disciplined real estate strategy that enables us to successfully open and operate stores across a wide range of formats and markets. We believe that our broad and comprehensive offering and compelling value proposition combine to create a leading destination for home décor. As of January 9, 2017, At Home operated 123 stores in 30 states and is headquartered in Plano, Texas. For more information, visit investor.athome.com.
-Financial Tables to Follow-
AT HOME GROUP INC.
Supplemental Information - Reconciliation of GAAP to Non-GAAP Financial Measures
(in thousands, except share and per share data)
Reconciliation of fiscal 2016 net income as reported to pro forma adjusted net income
Fiscal Year Ended
January 30, 2016
Net income (as reported)
Loss on extinguishment of debt
IPO transaction costs(a)
Interest on Senior Secured Notes(b)
Interest on Second Lien Term Loan(c)
Tax impact of pro forma adjustments and rate normalization(d)
Pro forma adjusted net income
Pro forma diluted weighted average shares outstanding (e)
Pro forma adjusted EPS
Charges incurred in connection with our initial public offering, which we do not expect to recur and do not consider in our evaluation of our ongoing performance.
Adjusts interest expense for the June 5, 2015 refinancing of our $360.0 million 10.75% Senior Secured Notes with $430.0 million of indebtedness under our first and second lien term loan facilities.
Adjusts stated interest expense for use of IPO proceeds for repayment in full of the $130.0 million of principal amount of indebtedness under our second lien term loan facility, which occurred in the third quarter of fiscal 2017.
Represents the tax impact associated with the adjusted expenses utilizing the effective tax rate in effect during the periods presented as well as the tax impact required in each period to present pro forma adjusted net income, including all outlined adjustments, subject to a normalized annual effective tax rate.
Represents the weighted average impact of common shares issued with our initial public offering in August 2016 as if they had been outstanding the entire period. Reflects the midpoint of the range associated with the pro forma adjusted net income and pro forma adjusted earnings per share figures shown.
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SOURCE At Home Group Inc.