Leslie’s, Inc. (“Leslie’s” or the “Company”; NASDAQ: LESL), the
largest and most trusted direct-to-consumer brand in the U.S. pool
and spa care industry, today announced its financial results for
the first quarter of Fiscal 2021 ended January 2, 2021.
Mike Egeck, Chief Executive Officer, commented, “Our record
fiscal Q1 results exceeded our internal expectations on both the
top and the bottom line. This strong performance continues to be
driven by the three unique pillars that make our business so
compelling, namely; the recurring and non-discretionary nature of
demand in our industry, the competitive advantages of our
integrated ecosystem of physical and digital assets, and the
significant whitespace opportunities we are addressing with our
multi-pronged growth strategy.”
“The first quarter is seasonally our lowest volume period, and
although we are very pleased with the strong start to the year, as
evidenced by the increase in our full year outlook, our entire
organization remains focused on the execution of our growth
initiatives for pool season 2021 and delivering on our financial
and operational goals,” Mr. Egeck concluded.
First Quarter Highlights
- Sales increased 17.9% to $145.0 million from $123.0 million in
the first quarter of Fiscal 2020. Comparable sales on an unshifted
basis increased 15.7% for the thirteen-week period ended January 2,
2021 compared to the thirteen week period ended December 28, 2019.
On a shifted basis, using a realigned period in 2020 for
comparability given the 53rd week in Fiscal 2020, comparable sales
increased 25.7%
- Gross profit increased 25.9% to $51.7 million from $41.1
million in the first quarter of Fiscal 2020 and gross margin was
35.7% compared to 33.4% in the prior year quarter, an increase of
225 basis points
- SG&A increased to $77.5 million from $59.7 million in the
first quarter of Fiscal 2020, or an increase of $17.8 million.
During the quarter, we recorded an increase in non-cash
equity-based compensation costs of $11.6 million and certain
one-time payments of contractual amounts of $8.2 million. These
amounts were primarily incurred in connection with our Initial
Public Offering
- Operating loss was $(25.8) million compared to $(18.6) million
in the first quarter of Fiscal 2020
- Net loss was $(30.3) million compared to $(26.2) million in the
first quarter of Fiscal 2020. Adjusted net loss improved by $13.7
million to $(10.6) million from $(24.3) million in the prior
year
- Loss per common share remained flat at $(0.17) when compared to
the prior year. Adjusted loss per common share improved by $0.10 to
$(0.06) from $(0.16) in the first quarter of Fiscal 2020
- Adjusted EBITDA improved by $8.8 million to $(0.2) million from
$(9.0) million in the prior year quarter
Balance Sheet and Cash Flow Highlights
- Cash and cash equivalents totaled $104.1 million and we had no
borrowings on our revolver at the end of the first quarter of
Fiscal 2021 compared to cash and cash equivalents of $1.9 million
and revolver borrowings of $6.3 million at the end of the first
quarter of Fiscal 2020
- Inventory totaled $174.5 million at the end of the first
quarter of Fiscal 2021 compared to $185.1 million at the end of the
first quarter of Fiscal 2020
- Net cash used in operating activities totaled $119.3 million in
the first quarter of Fiscal 2021 compared to $81.3 million in the
first quarter of Fiscal 2020
- Capital expenditures totaled $2.7 million in the first quarter
of Fiscal 2021 compared to $5.7 million in the first quarter of
Fiscal 2020
Fiscal 2021 OutlookThe Company raised guidance
for the full year Fiscal 2021, a 52 week year. Fiscal 2020 included
a 53rd week, which added approximately $18.0 million in sales, $1.5
million in net income, and $3.0 million in adjusted EBITDA.
|
Current Outlook |
Prior Outlook |
Sales |
$1,175 to $1,195 million |
$1,155 to $1,175 million |
GAAP net income |
$82 to $92 million |
$82 to $92 million |
Adjusted net income |
$106 to $116 million |
$96 to $106 million |
Adjusted EBITDA |
$202 to $208 million |
$192 to $198 million |
Adjusted net income per share |
$0.55 to $0.60 |
$0.50 to $0.55 |
Diluted share count |
193 million |
193 million |
Conference Call DetailsA conference call to
discuss the first quarter of Fiscal 2021 financial results is
scheduled for today, February 4, 2021 at 4:30 p.m. Eastern Time.
Investors and analysts interested in participating in the call are
invited to dial 877-407-0784 (international callers please dial
1-201-689-8560) approximately 10 minutes prior to the start of the
call. A live audio webcast of the conference call will be available
online at https://ir.lesliespool.com/.
A recorded replay of the conference call will be
available within approximately three hours of the conclusion of the
call and can be accessed online at https://ir.lesliespool.com/ for
90 days.
About Leslie’sFounded in 1963, Leslie’s is the
largest direct-to-consumer brand in the U.S. pool and spa care
industry, serving residential, professional, and commercial
consumers. Leslie’s markets its products through more than 900
physical locations and multiple digital platforms. The company
employs more than 5,000 associates, pool and spa care experts, and
certified technicians who are passionate about empowering consumers
with the knowledge, products, and solutions necessary to
confidently maintain and enjoy their pools and spas.
Use of Non-GAAP Financial MeasuresIn addition
to reporting financial results in accordance with accounting
principles generally accepted in the United States (“GAAP”), the
Company uses certain non-GAAP financial measures, including
comparable sales growth and adjusted EBITDA, adjusted net income,
and adjusted net income per share, to evaluate the effectiveness of
its business strategies, to make budgeting decisions, and to
compare its performance against that of other peer companies using
similar measures. These non-GAAP financial measures should not be
considered in isolation or as substitutes for the Company’s results
as reported under GAAP. In addition, these non-GAAP financial
measures are not calculated in the same manner by all companies,
and accordingly, are not necessarily comparable to similarly titled
measures of other companies and may not be appropriate measures for
performance relative to other companies.
Comparable Sales GrowthWe measure comparable sales growth as the
increase or decrease in sales recorded by the comparable base in
any reporting period, compared to sales recorded by the comparable
base in the prior reporting period. The comparable base includes
sales through our locations and through our e-commerce websites and
third-party marketplaces. Comparable sales is a key measure used by
management and our board of directors to assess our financial
performance.
Adjusted EBITDAAdjusted EBITDA is a key measure used by
management and our board of directors to assess our financial
performance. Adjusted EBITDA is also frequently used by analysts,
investors, and other interested parties to evaluate companies in
our industry, when considered alongside other GAAP measures.
Adjusted EBITDA is defined as earnings before interest
(including amortization of debt costs), taxes, depreciation,
amortization, loss (gain) on disposition of assets, management
fees, equity-based compensation expense, mark-to-market on interest
rate cap, and special items. Adjusted EBITDA is not a recognized
measure of financial performance under GAAP but is used by some
investors to determine a company’s ability to service or incur
indebtedness. Adjusted EBITDA should not be construed as an
indicator of a company’s operating performance in isolation from,
or as a substitute for, net income, cash flows from operations or
cash flow data, all of which are prepared in accordance with GAAP.
We have presented adjusted EBITDA solely as supplemental disclosure
because we believe it allows for a more complete analysis of
results of operations. Adjusted EBITDA is not intended to
represent, and should not be considered more meaningful than, or as
an alternative to, measures of operating performance as determined
in accordance with GAAP. In the future, we may incur expenses or
charges such as those added back to calculate adjusted EBITDA. Our
presentation of adjusted EBITDA should not be construed as an
inference that our future results will be unaffected by these
items.
Adjusted Net Income and Adjusted Net Income per ShareAdjusted
net income and adjusted net income per share are additional key
measures used by management and our board of directors to assess
our financial performance. Adjusted net income and adjusted net
income per share are also frequently used by analysts, investors,
and other interested parties to evaluate companies in our industry,
when considered alongside other GAAP measures.
Adjusted net income is defined as net income adjusted to exclude
loss (gain) on disposition of assets, management fees, equity-based
compensation expense, mark-to-market on interest rate cap, and
special items. Adjusted net income per share is defined as adjusted
net income divided by the weighted average number of common shares
outstanding.
Forward Looking StatementsThis press release
contains forward-looking statements about us and our industry that
involve substantial risks and uncertainties. All statements other
than statements of historical facts contained in this press
release, including statements regarding our future results of
operations or financial condition, business strategy and plans and
objectives of management for future operations, are forward-looking
statements. In some cases, you can identify forward-looking
statements because they contain words such as “anticipate,”
“believe,” “contemplate,” “continue,” “could,” “estimate,”
“expect,” “intend,” “may,” “plan,” “potential,” “predict,”
“project,” “should,” “target,” “will,” or “would” or the negative
of these words or other similar terms or expressions. Our actual
results could differ materially from those indicated in these
forward-looking statements for a variety of reasons, including,
among others:
- our ability to execute on our growth strategies;
- our ability to maintain favorable relationships with suppliers
and manufacturers;
- competition from mass merchants and specialty retailers;
- regulatory changes and development affecting our current and
future products;
- our ability to obtain additional capital to finance
operations;
- impacts on our business from the COVID-19 pandemic; and
- other risks and uncertainties, including those listed in the
section titled “Risk Factors” in the Company’s Annual Report on
Form 10-K for the fiscal year ended October 3, 2020 and subsequent
filings with the U.S. Securities and Exchange Commission.
You should not rely on forward-looking statements as predictions
of future events. We have based the forward-looking statements
contained in this press release primarily on our current
expectations and projections about future events and trends that we
believe may affect our business, financial condition, and operating
results. The outcome of the events described in these
forward-looking statements is subject to risks, uncertainties, and
other factors described in the section titled “Risk Factors” in the
Company’s Annual Report on Form 10-K for the fiscal year ended
October 3, 2020 and subsequent filings with the Securities and
Exchange Commission. New risks and uncertainties emerge from time
to time, and it is not possible for us to predict all risks and
uncertainties that could have an impact on the forward-looking
statements contained in this press release. The results, events,
and circumstances reflected in the forward-looking statements may
not be achieved or occur, and actual results, events, or
circumstances could differ materially from those described in the
forward-looking statements.
In addition, statements that “we believe” and similar statements
reflect our beliefs and opinions on the relevant subject based on
information available to us as of the date of this press release.
And while we believe that information provides a reasonable basis
for these statements, that information may be limited or
incomplete.
The forward-looking statements made in this press release are
based on events or circumstances as of the date on which the
statements are made. We undertake no obligation to update any
forward-looking statements made in this press release to reflect
events or circumstances after the date of this press release or to
reflect new information or the occurrence of unanticipated events,
except as required by law.
Contact
InvestorsFarah Soi/Caitlin
ChurchillICRinvestorrelations@lesl.com
MediaMegan GaffneySHIFT Communicationsmedia@lesl.com
Condensed Consolidated Statements of Operations
(unaudited) |
|
|
|
|
|
|
|
|
Three Months Ended |
|
Three Months Ended |
In thousands, except per share amounts |
January 2, 2021 |
|
December 28, 2019 |
Sales |
$ |
145,006 |
|
|
$ |
122,978 |
|
Cost of merchandise
and services sold |
|
93,291 |
|
|
|
81,900 |
|
Gross
profit |
|
51,715 |
|
|
|
41,078 |
|
Selling, general
and administrative expenses |
|
77,489 |
|
|
|
59,721 |
|
Operating
loss |
|
(25,774 |
) |
|
|
(18,643 |
) |
Other expense: |
|
|
|
Interest
expense |
|
11,516 |
|
|
|
22,417 |
|
Loss on debt
extinguishment |
|
7,281 |
|
|
|
- |
|
Other expenses,
net |
|
- |
|
|
|
137 |
|
Total other expense |
|
18,797 |
|
|
|
22,553 |
|
Loss before
taxes |
|
(44,571 |
) |
|
|
(41,197 |
) |
Income tax
benefit |
|
(14,314 |
) |
|
|
(15,010 |
) |
Net loss |
$ |
(30,257 |
) |
|
$ |
(26,187 |
) |
|
|
|
|
Net loss per
share |
|
|
|
Basic and
diluted |
$ |
(0.17 |
) |
|
$ |
(0.17 |
) |
Weighted
average shares outstanding |
|
|
|
Basic and
diluted |
|
176,990 |
|
|
|
156,500 |
|
|
|
|
|
|
|
|
|
Other financial data (1) |
|
|
|
Adjusted
EBITDA |
$ |
(243 |
) |
|
$ |
(9,004 |
) |
Adjusted net
loss |
$ |
(10,619 |
) |
|
$ |
(24,314 |
) |
Basic and
diluted adjusted net loss per share |
$ |
(0.06 |
) |
|
$ |
(0.16 |
) |
|
|
|
|
|
|
|
|
(1) See the
section titled "GAAP to Non-GAAP Reconciliation" |
|
|
|
|
|
|
|
Condensed Consolidated Balance Sheets
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of |
|
As of |
|
As of |
In thousands |
January 2, 2021 |
|
October 3, 2020 |
|
December 28, 2019 |
Assets |
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Cash and cash equivalents |
$ |
104,077 |
|
|
$ |
157,072 |
|
|
$ |
1,938 |
|
|
Accounts and
other receivables, net |
|
37,116 |
|
|
|
31,481 |
|
|
|
49,657 |
|
|
Inventories,
net |
|
174,535 |
|
|
|
148,966 |
|
|
|
185,130 |
|
|
Prepaid expenses and other current assets |
|
39,899 |
|
|
|
34,614 |
|
|
|
6,201 |
|
Total current assets |
|
355,627 |
|
|
|
372,133 |
|
|
|
242,926 |
|
Property and equipment, net |
|
62,628 |
|
|
|
66,391 |
|
|
|
71,805 |
|
Operating lease right-of-use assets |
|
191,125 |
|
|
|
177,655 |
|
|
|
212,492 |
|
Goodwill and other intangibles, net |
|
120,636 |
|
|
|
121,186 |
|
|
|
122,718 |
|
Deferred tax assets |
|
14,729 |
|
|
|
6,583 |
|
|
|
- |
|
Other assets |
|
2,363 |
|
|
|
2,490 |
|
|
|
1,345 |
|
Total assets |
$ |
747,108 |
|
|
$ |
746,438 |
|
|
$ |
651,286 |
|
|
|
|
|
|
|
|
Liabilities and stockholders' deficit |
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
Accounts
payable |
$ |
69,046 |
|
|
$ |
92,372 |
|
|
$ |
75,265 |
|
|
Accrued
expenses |
|
59,086 |
|
|
|
101,167 |
|
|
|
54,381 |
|
|
Operating
lease liabilities |
|
56,398 |
|
|
|
54,459 |
|
|
|
60,502 |
|
|
Income taxes
payable |
|
- |
|
|
|
1,857 |
|
|
|
- |
|
|
Current
portion of long-term debt |
|
8,341 |
|
|
|
8,341 |
|
|
|
8,341 |
|
Total current liabilities |
|
192,871 |
|
|
|
258,196 |
|
|
|
198,489 |
|
Revolving commitment |
|
- |
|
|
|
- |
|
|
|
6,300 |
|
Deferred tax liabilities |
|
- |
|
|
|
- |
|
|
|
3,911 |
|
Operating lease liabilities, noncurrent |
|
139,796 |
|
|
|
130,234 |
|
|
|
162,329 |
|
Long-term debt, net |
|
795,394 |
|
|
|
1,179,550 |
|
|
|
1,185,256 |
|
Other long-term liabilities |
|
5,457 |
|
|
|
5,457 |
|
|
|
7,936 |
|
Total liabilities |
|
1,133,518 |
|
|
|
1,573,437 |
|
|
|
1,564,221 |
|
Total stockholders' deficit |
|
(386,410 |
) |
|
|
(826,999 |
) |
|
|
(912,935 |
) |
Total liabilities and stockholders' deficit |
$ |
747,108 |
|
|
$ |
746,438 |
|
|
$ |
651,286 |
|
|
|
|
|
|
|
|
|
Condensed Consolidated Statements of Cash Flows
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Three Months Ended |
|
In thousands |
January 2, 2021 |
|
December 28, 2019 |
|
|
|
|
|
|
|
Operating activities |
|
|
|
|
Net loss |
$ |
(30,257 |
) |
|
$ |
(26,187 |
) |
|
Adjustments to reconcile net loss to net cash provided by operating
activities: |
|
|
|
|
|
Depreciation and amortization |
|
6,595 |
|
|
|
7,276 |
|
|
|
Equity-based
compensation |
|
12,160 |
|
|
|
598 |
|
|
|
Amortization
of deferred financing costs and debt discounts |
|
648 |
|
|
|
848 |
|
|
|
Provision
for doubtful accounts |
|
59 |
|
|
|
57 |
|
|
|
Loss on
extinguishment of debt |
|
7,281 |
|
|
|
- |
|
|
|
Deferred
income taxes |
|
(8,146 |
) |
|
|
2,672 |
|
|
|
Loss on
disposition of assets |
|
(1,758 |
) |
|
|
443 |
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
Accounts and
other receivables |
|
(5,694 |
) |
|
|
(15,842 |
) |
|
|
Inventories |
|
(25,569 |
) |
|
|
(34,402 |
) |
|
|
Prepaid
expenses and other current assets |
|
(5,285 |
) |
|
|
1,502 |
|
|
|
Other
assets |
|
127 |
|
|
|
75 |
|
|
|
Accounts
payable and accrued expenses |
|
(65,629 |
) |
|
|
(21,922 |
) |
|
|
Income taxes
payable |
|
(1,857 |
) |
|
|
(6,713 |
) |
|
|
Operating
lease assets and liabilities, net |
|
(1,969 |
) |
|
|
10,339 |
|
|
Net cash used in operating activities |
|
(119,294 |
) |
|
|
(81,256 |
) |
|
|
|
|
|
|
|
Investing activities |
|
|
|
|
|
Purchases of
property and equipment |
|
(2,706 |
) |
|
|
(5,738 |
) |
|
|
Acquisitions, net of cash acquired |
|
- |
|
|
|
(6,188 |
) |
|
|
Proceeds
from dispositions of fixed assets |
|
2,404 |
|
|
|
6 |
|
|
Net cash used in investing activities |
|
(302 |
) |
|
|
(11,920 |
) |
|
|
|
|
|
|
|
Financing activities |
|
|
|
|
|
Borrowings
on revolving commitment |
|
- |
|
|
|
6,300 |
|
|
|
Repayment of
Senior Notes |
|
(390,000 |
) |
|
|
- |
|
|
|
Principal
payments on Term Loan |
|
(2,085 |
) |
|
|
(2,085 |
) |
|
|
Proceeds
from issuance of common stock upon initial public offering, net of
offering costs |
|
458,686 |
|
|
|
- |
|
|
Net cash provided by financing activities |
|
66,601 |
|
|
|
4,215 |
|
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents |
|
(52,995 |
) |
|
|
(88,961 |
) |
|
Cash and cash equivalents, beginning of period |
|
157,072 |
|
|
|
90,899 |
|
|
Cash and cash equivalents, end of period |
$ |
104,077 |
|
|
$ |
1,938 |
|
|
|
|
|
|
|
|
GAAP
to Non-GAAP Reconciliation (unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Three Months Ended |
|
In thousands, except per share amounts |
|
January 2, 2021 |
|
December 28, 2019 |
|
|
|
|
|
|
|
Net loss |
|
$ |
(30,257 |
) |
|
$ |
(26,187 |
) |
|
Interest
expense |
|
|
11,516 |
|
|
|
22,417 |
|
|
Income tax
benefit |
|
|
(14,314 |
) |
|
|
(15,010 |
) |
|
Depreciation
and amortization expenses (a) |
|
|
6,595 |
|
|
|
7,276 |
|
|
(Gain) loss
on disposition of assets (b) |
|
|
(1,758 |
) |
|
|
443 |
|
|
Management
fee (c) |
|
|
382 |
|
|
|
1,322 |
|
|
Equity-based
compensation expense (d) |
|
|
12,160 |
|
|
|
598 |
|
|
Mark-to-market on interest rate cap (e) |
|
|
- |
|
|
|
22 |
|
|
Loss on debt
extinguishment (f) |
|
|
7,281 |
|
|
|
- |
|
|
Other
(g) |
|
|
8,152 |
|
|
|
115 |
|
|
Adjusted EBITDA |
|
$ |
(243 |
) |
|
$ |
(9,004 |
) |
|
|
|
|
|
|
|
Net
loss |
|
$ |
(30,257 |
) |
|
$ |
(26,187 |
) |
|
(Gain) loss
on disposition of assets (b) |
|
|
(1,758 |
) |
|
|
443 |
|
|
Management
fee (c) |
|
|
382 |
|
|
|
1,322 |
|
|
Equity-based
compensation expense (d) |
|
|
12,160 |
|
|
|
598 |
|
|
Mark-to-market on interest rate cap (e) |
|
|
- |
|
|
|
22 |
|
|
Loss on debt
extinguishment (f) |
|
|
7,281 |
|
|
|
- |
|
|
Other
(g) |
|
|
8,152 |
|
|
|
115 |
|
|
Tax effects
of these adjustments (h) |
|
|
(6,579 |
) |
|
|
(627 |
) |
|
Adjusted net loss |
|
$ |
(10,619 |
) |
|
$ |
(24,314 |
) |
|
|
|
|
|
|
|
Adjusted net
loss per share |
|
|
|
|
|
Basic and diluted |
|
$ |
(0.06 |
) |
|
$ |
(0.16 |
) |
|
Weighted
average shares outstanding |
|
|
|
|
|
Basic and diluted |
|
|
176,990 |
|
|
|
156,500 |
|
|
|
|
|
|
|
|
(a) Includes depreciation related to our distribution centers and
stores which is included within the cost of merchandise and
services sold line item in our condensed consolidated statements of
operations. |
|
(b) Consists of loss on disposition of assets associated with store
closures or the sale of property and equipment. |
|
(c) Represents amounts paid or accrued in connection with our
management services agreement. The management services agreement
terminated upon the completion of our IPO. |
|
(d) Represents non-cash charges related to equity-based
compensation. |
|
|
|
(e) Includes non-cash charges related to the change in fair value
of our interest rate cap agreements. |
|
(f) Represents non-cash expense due to the write-off of deferred
financing costs related to the repayment of our senior unsecured
floating rate notes due 2024 during the first quarter of fiscal
year 2021. |
|
(g) Other non-recurring, non-cash or discrete items as determined
by management, such as transaction related costs, personnel-related
costs, legal expenses, strategic project costs, and miscellaneous
costs. The first quarter of fiscal 2021 includes one-time payments
of contractual amounts incurred in connection with our IPO. |
|
(h) Represents the tax effect of the total adjustments based on our
actual statutory tax rate for fiscal year 2020 and our estimated
statutory tax rate for fiscal year 2021. |
Leslies (NASDAQ:LESL)
過去 株価チャート
から 6 2024 まで 7 2024
Leslies (NASDAQ:LESL)
過去 株価チャート
から 7 2023 まで 7 2024