FORT MYERS, Fla., Feb. 22,
2017 /PRNewswire/ -- Chico's FAS, Inc. (NYSE: CHS) today
announced its financial results for the fiscal 2016 fourth quarter
and fiscal year ended January 28, 2017.
For the thirteen weeks ended January 28, 2017 ("the fourth
quarter"), the Company reported net income of $13.5 million, or $0.10 per diluted share, compared to a net loss
of $21.1 million, or $0.16 per diluted share, for the thirteen weeks
ended January 30, 2016 ("last year's fourth quarter"). The
Company reported adjusted net income of $6.2
million, or $0.05 adjusted
earnings per diluted share, in last year's fourth quarter. The 2015
fourth quarter adjusted results exclude EPS net charges of
$0.21 related to restructuring and
strategic charges and Boston Proper, as presented in the
accompanying GAAP to non-GAAP reconciliation.
For the fifty-two weeks ended January 28, 2017 ("fiscal
2016"), the Company reported net income of $91.2 million, or $0.69 per diluted share, compared to net income
of $1.9 million, or $0.01 per diluted share, for the fifty-two weeks
ended January 30, 2016 ("fiscal 2015"). The Company reported
fiscal 2016 adjusted net income of $106.7
million, or $0.81 adjusted
earnings per diluted share, compared to adjusted net income of
$105.9 million, or $0.75 adjusted earnings per diluted share, in
fiscal 2015. The adjusted results exclude EPS net charges of
$0.12 in fiscal 2016 and $0.74 in fiscal 2015 related to restructuring and
strategic charges and Boston Proper, as presented in the
accompanying GAAP to non-GAAP reconciliation.
"We are extremely pleased with our results this quarter," said
Shelley Broader, CEO and President.
"We drove significant earnings growth, highlighted by gross margin
expansion, SG&A leverage, and a substantial increase in
operating margin. I am proud of our team and their continuing
execution of our strategic initiatives."
Net Sales
For the fourth quarter, net sales were $600.8 million compared to $631.6 million in last year's fourth quarter.
This decrease of 4.9% included $16.8
million related to Boston Proper last year. When excluding
Boston Proper from fiscal 2015, net sales decreased 2.3%, primarily
reflecting a decline in comparable sales of 2.5%, comprised of
reduced transaction count and an increase in average dollar sale.
Fourth quarter average unit retail increased primarily due to a
reduction in promotional activity.
For fiscal 2016, net sales were $2.5
billion compared to $2.7
billion in fiscal 2015. This decrease of 6.9% included
$87.0 million related to Boston
Proper last year. When excluding Boston Proper from fiscal 2015,
net sales decreased 3.8%, primarily reflecting a decline in
comparable sales of 3.7%, comprised of reduced transaction count
and lower average dollar sale.
Comparable Sales
|
Thirteen Weeks
Ended
|
|
Fifty-Two Weeks
Ended
|
|
January 28,
2017
|
|
January 30,
2016
|
|
January 28,
2017
|
|
January 30,
2016
|
Chico's
|
(4.8)
|
%
|
|
(1.7)
|
%
|
|
(5.3)
|
%
|
|
(2.0)
|
%
|
White House Black
Market
|
(0.6)
|
%
|
|
(7.4)
|
%
|
|
(2.8)
|
%
|
|
(2.5)
|
%
|
Soma
|
0.4
|
%
|
|
2.1
|
%
|
|
0.5
|
%
|
|
3.1
|
%
|
Total
Company
|
(2.5)
|
%
|
|
(3.2)
|
%
|
|
(3.7)
|
%
|
|
(1.5)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Margin
For the fourth quarter, gross margin was $213.4 million, or 35.5%, compared to
$217.4 million, or 34.4%, in last
year's fourth quarter. When excluding Boston Proper from fiscal
2015, gross margin increased 80 basis points in fiscal 2016
compared to gross margin of $213.3
million, or 34.7%, last year. This 80 basis point increase
from the 2015 adjusted gross margin rate primarily reflects reduced
promotional activity, partially offset by an increase in incentive
compensation.
Selling, General and Administrative Expenses
For the fourth quarter, selling, general and administrative
expenses ("SG&A") were $192.0
million, or 31.9%, compared to $217.2
million, or 34.4% last year. When excluding Boston Proper
from fiscal 2015, SG&A decreased $13.6
million, or 150 basis points, compared to $205.6 million, or 33.4%, last year. This
$13.6 million decrease is primarily
due to a reduction in unproductive marketing spend and improvements
in store labor productivity, partially offset by an increase in
incentive compensation.
Income Tax Expense
The fourth quarter fiscal 2016 effective tax rate was 35.4%. In
the fourth quarter of fiscal 2015, the Company recorded a tax
benefit as a result of the impact of restructuring and strategic
charges.
Inventories
At the end of the fourth quarter of 2016, inventories totaled
$232.4 million compared to
$233.8 million last year. The
decrease of 0.6% primarily reflected a 4% decrease in on-hand
inventory as a result of improved inventory management, partially
offset by an increase in in-transit inventory primarily due to
product launches scheduled in the first quarter of 2017 and the
timing of the Chinese New Year.
Share Repurchase Program
During the fourth quarter of 2016, the Company repurchased 1.6
million shares for $20.0 million, at
an average of $12.81 per share, under
its $300.0 million share repurchase
program announced in November 2015,
with $163.6 million remaining under
the program. During fiscal 2016, the Company repurchased a total of
8.1 million shares for $96.4 million,
at an average of $11.88 per
share.
Changes in Presentation
Commencing in the first quarter of fiscal 2016, store occupancy
expenses and shipping expenses, historically presented in SG&A,
are being presented in Cost of Goods Sold. The Company believes
that these costs represent direct costs associated with the sale of
its merchandise, and these changes better align the Company with
its peers and better reflect how the business operates.
Additionally, shipping revenue, historically presented in SG&A,
is being presented in Net Sales. These adjustments were made
retrospectively and all periods presented conform with this
presentation.
2017 Full-Year Outlook
For fiscal 2017, the Company is anticipating a low single-digit
percentage decline in comparable sales as the Company continues to
rationalize its promotional activity. The Company expects to
achieve gross margin leverage for the year, primarily due to
reduced promotional activity and savings from the supply chain
initiative launched last year. The Company is planning modest
SG&A leverage. Overall, the Company is anticipating steady
improvement in operating margin that will advance its progress
toward its target of double digit operating margin in 2019.
ABOUT CHICO'S FAS, INC.
The Company, through its brands – Chico's, White House Black
Market, and Soma, is a leading omni-channel specialty retailer of
women's private branded, sophisticated, casual-to-dressy clothing,
intimates and complementary accessories.
As of January 28, 2017, the Company operated 1,501 stores
in the US and Canada and sold
merchandise through franchise locations in Mexico. The Company's merchandise is also
available at www.chicos.com, www.whbm.com, and www.soma.com. For
more detailed information on Chico's FAS, Inc., please go to our
corporate website at www.chicosfas.com.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995
Some statements herein may be
"forward-looking statements," within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, which reflect our
current views with respect to certain events that could have an
effect on our future financial performance, including but without
limitation, statements regarding our plans and objectives, and the
success of our organizational redesign and other strategic
initiatives aimed at increasing sales volume and profitability
through our four established focus areas. These statements may
address items such as expectations for future sales, gross margin,
SG&A (particularly estimated expected savings), operating
margin, inventory levels, and comparable store sales and cash
needs. These statements relate to expectations concerning matters
that are not historical fact and may include the words or phrases
such as "expects," "believes," "anticipates," "plans," "estimates,"
"approximately," "our planning assumptions," "future outlook," and
similar expressions. Except for historical information, matters
discussed in such oral and written statements are forward-looking
statements. These forward-looking statements are based largely on
information currently available to our management and on our
current expectations, assumptions, plans, estimates, judgments and
projections about our business and our industry, and are subject to
various risks and uncertainties that could cause actual results to
differ materially from historical results or those currently
anticipated. Although we believe our expectations are based on
reasonable estimates and assumptions, we cannot guarantee their
accuracy or our future performance, and there are a number of known
and unknown risks, uncertainties, contingencies, and other factors
(many of which are outside our control) that could cause actual
results to differ materially from those expressed or implied by
such forward-looking statements. Accordingly, there is no assurance
that our expectations will, in fact, occur or that our estimates or
assumptions will be correct, and we caution investors and all
others not to place undue reliance on such forward-looking
statements. Factors that could cause or contribute to such
differences include, but are not limited to, changes in the general
economic and business environment; changes in the general or
specialty retail or apparel industries; the availability of quality
store sites; the ability to successfully execute and achieve the
expected results of our business strategies, particular strategic
initiatives, and organizational redesign; the integration of our
new management team; changes in the political environment that
create consumer uncertainty; significant changes to product import
and distribution costs (such as new or increased taxes or tariffs,
unexpected consolidation in the freight carrier industry, and
unexpected costs and exposure associated with our shift to a
predominantly FOB shipping structure rather than a mix of FOB and
DDP); significant shifts in consumer behavior; and those other
factors described in Item 1A, "Risk Factors" and in the
"Forward-Looking Statements" disclosure in Item 7. "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" of our Form 10-K. There can be no assurance that the
actual future results, performance, or achievements expressed or
implied by such forward-looking statements will occur. Investors
using forward-looking statements are encouraged to review the
Company's latest annual report on Form 10-K, its filings on Form
10-Q, management's discussion and analysis in the Company's latest
annual report to stockholders, the Company's filings on Form 8-K,
and other federal securities law filings for a description of other
important factors that may affect the Company's business, results
of operations and financial condition. All written or oral
forward-looking statements that are made or attributable to us are
expressly qualified in their entirety by this cautionary notice.
The Company does not undertake to publicly update or revise its
forward looking statements even if experience or future changes
make it clear that projected results expressed or implied in such
statements will not be realized.
(Financial Tables Follow)
Executive Contact:
Jennifer
Powers
Vice President – Investor Relations
Chico's FAS, Inc.
(239) 346-4199
Chico's FAS, Inc.
and Subsidiaries
|
Condensed
Consolidated Statements of Income (Loss)
|
(Unaudited)
|
(in thousands,
except per share amounts)
|
|
|
Thirteen Weeks
Ended
|
|
Fifty-Two Weeks
Ended
|
|
January 28,
2017
|
|
January 30,
2016
|
|
January 28,
2017
|
|
January 30,
2016
|
|
Amount
|
|
% of
Sales
|
|
Amount
|
|
% of
Sales
|
|
Amount
|
|
% of
Sales
|
|
Amount
|
|
% of
Sales
|
Net
sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chico's
|
$
|
290,763
|
|
|
48.4
|
|
|
$
|
305,094
|
|
|
48.3
|
|
|
$
|
1,285,830
|
|
|
51.9
|
|
|
$
|
1,363,792
|
|
|
51.3
|
|
White House Black
Market
|
212,615
|
|
|
35.4
|
|
|
215,197
|
|
|
34.1
|
|
|
846,035
|
|
|
34.2
|
|
|
874,879
|
|
|
32.9
|
|
Soma
|
97,411
|
|
|
16.2
|
|
|
94,569
|
|
|
15.0
|
|
|
344,545
|
|
|
13.9
|
|
|
334,916
|
|
|
12.6
|
|
Boston
Proper
|
—
|
|
|
0.0
|
|
|
16,750
|
|
|
2.6
|
|
|
—
|
|
|
0.0
|
|
|
87,048
|
|
|
3.2
|
|
Total net
sales
|
600,789
|
|
|
100.0
|
|
|
631,610
|
|
|
100.0
|
|
|
2,476,410
|
|
|
100.0
|
|
|
2,660,635
|
|
|
100.0
|
|
Cost of goods
sold
|
387,392
|
|
|
64.5
|
|
|
414,221
|
|
|
65.6
|
|
|
1,529,574
|
|
|
61.8
|
|
|
1,633,764
|
|
|
61.4
|
|
Gross
margin
|
213,397
|
|
|
35.5
|
|
|
217,389
|
|
|
34.4
|
|
|
946,836
|
|
|
38.2
|
|
|
1,026,871
|
|
|
38.6
|
|
Selling, general and
administrative expenses
|
191,990
|
|
|
31.9
|
|
|
217,208
|
|
|
34.4
|
|
|
775,107
|
|
|
31.2
|
|
|
878,699
|
|
|
33.0
|
|
Goodwill and trade
name impairment
|
—
|
|
|
0.0
|
|
|
—
|
|
|
0.0
|
|
|
—
|
|
|
0.0
|
|
|
112,455
|
|
|
4.3
|
|
Restructuring and
strategic charges
|
—
|
|
|
0.0
|
|
|
14,623
|
|
|
2.3
|
|
|
31,027
|
|
|
1.3
|
|
|
48,801
|
|
|
1.8
|
|
Income (loss) from
operations
|
21,407
|
|
|
3.6
|
|
|
(14,442)
|
|
|
(2.3)
|
|
|
140,702
|
|
|
5.7
|
|
|
(13,084)
|
|
|
(0.5)
|
|
Interest expense,
net
|
(499)
|
|
|
(0.1)
|
|
|
(449)
|
|
|
(0.1)
|
|
|
(1,973)
|
|
|
(0.1)
|
|
|
(1,870)
|
|
|
0.0
|
|
Income (loss)
before income taxes
|
20,908
|
|
|
3.5
|
|
|
(14,891)
|
|
|
(2.4)
|
|
|
138,729
|
|
|
5.6
|
|
|
(14,954)
|
|
|
(0.5)
|
|
Income tax provision
(benefit)
|
7,400
|
|
|
1.3
|
|
|
6,200
|
|
|
1.0
|
|
|
47,500
|
|
|
1.9
|
|
|
(16,900)
|
|
|
(0.6)
|
|
Net income
(loss)
|
$
|
13,508
|
|
|
2.2
|
|
|
$
|
(21,091)
|
|
|
(3.4)
|
|
|
$
|
91,229
|
|
|
3.7
|
|
|
$
|
1,946
|
|
|
0.1
|
|
Per share
data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
common share-basic
|
$
|
0.10
|
|
|
|
|
$
|
(0.16)
|
|
|
|
|
$
|
0.69
|
|
|
|
|
$
|
0.01
|
|
|
|
Net income (loss) per
common and common equivalent share–diluted
|
$
|
0.10
|
|
|
|
|
$
|
(0.16)
|
|
|
|
|
$
|
0.69
|
|
|
|
|
$
|
0.01
|
|
|
|
Weighted average
common shares outstanding–basic
|
126,489
|
|
|
|
|
135,275
|
|
|
|
|
128,995
|
|
|
|
|
138,366
|
|
|
|
Weighted average
common and common equivalent shares outstanding–diluted
|
126,905
|
|
|
|
|
135,275
|
|
|
|
|
129,237
|
|
|
|
|
138,741
|
|
|
|
Dividends declared
per share
|
$
|
0.08
|
|
|
|
|
$
|
0.0775
|
|
|
|
|
$
|
0.32
|
|
|
|
|
$
|
0.31
|
|
|
|
Chico's FAS, Inc.
and Subsidiaries
|
Condensed
Consolidated Balance Sheets
|
(Unaudited)
|
(in
thousands)
|
|
|
January 28,
2017
|
|
January 30,
2016
|
|
|
|
|
ASSETS
|
|
|
|
|
|
Current
Assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
142,135
|
|
|
$
|
89,951
|
|
Marketable
securities, at fair value
|
50,370
|
|
|
50,194
|
|
Inventories
|
232,363
|
|
|
233,834
|
|
Prepaid expenses and
accounts receivable
|
50,350
|
|
|
45,660
|
|
Income tax
receivable
|
2,408
|
|
|
29,157
|
|
Assets held for
sale
|
—
|
|
|
16,525
|
|
Total Current
Assets
|
477,626
|
|
|
465,321
|
|
Property and
Equipment, net
|
477,185
|
|
|
550,953
|
|
Other
Assets:
|
|
|
|
Goodwill
|
96,774
|
|
|
96,774
|
|
Other intangible
assets, net
|
38,930
|
|
|
38,930
|
|
Other assets,
net
|
18,479
|
|
|
14,074
|
|
Total Other
Assets
|
154,183
|
|
|
149,778
|
|
|
$
|
1,108,994
|
|
|
$
|
1,166,052
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current
Liabilities:
|
|
|
|
Accounts
payable
|
$
|
116,378
|
|
|
$
|
129,343
|
|
Current
debt
|
16,250
|
|
|
10,000
|
|
Other current and
deferred liabilities
|
170,232
|
|
|
158,788
|
|
Total Current
Liabilities
|
302,860
|
|
|
298,131
|
|
Noncurrent
Liabilities:
|
|
|
|
Long-term
debt
|
68,535
|
|
|
82,219
|
|
Deferred
liabilities
|
118,543
|
|
|
130,743
|
|
Deferred
taxes
|
9,883
|
|
|
15,171
|
|
Total Noncurrent
Liabilities
|
196,961
|
|
|
228,133
|
|
Stockholders'
Equity:
|
|
|
|
Preferred
stock
|
—
|
|
|
—
|
|
Common
stock
|
1,288
|
|
|
1,355
|
|
Additional paid-in
capital
|
452,756
|
|
|
435,881
|
|
Treasury stock,
26,418 shares at January 28, 2017 and 18,307 shares at January 30,
2016
|
(386,094)
|
|
|
(289,813)
|
|
Retained
earnings
|
541,251
|
|
|
492,325
|
|
Accumulated other
comprehensive (loss) income
|
(28)
|
|
|
40
|
|
Total
Stockholders' Equity
|
609,173
|
|
|
639,788
|
|
|
$
|
1,108,994
|
|
|
$
|
1,166,052
|
|
Chico's FAS, Inc.
and Subsidiaries
|
Condensed
Consolidated Cash Flow Statements
|
(Unaudited)
|
(in
thousands)
|
|
|
Fifty-Two Weeks
Ended
|
|
January 28,
2017
|
|
January 30,
2016
|
Cash Flows From
Operating Activities:
|
|
|
|
Net income
|
$
|
91,229
|
|
|
$
|
1,946
|
|
Adjustments to
reconcile net income to net cash provided by operating activities
—
|
|
|
|
Goodwill and
intangible impairment charges, pre-tax
|
—
|
|
|
112,455
|
|
Depreciation and
amortization
|
109,251
|
|
|
118,800
|
|
Deferred tax
benefit
|
(8,427)
|
|
|
(34,415)
|
|
Stock-based
compensation expense
|
21,249
|
|
|
30,062
|
|
Excess tax benefit
from stock-based compensation
|
(604)
|
|
|
(3,084)
|
|
Deferred rent and
lease credits
|
(18,811)
|
|
|
(21,741)
|
|
Loss on disposal and
impairment of property and equipment
|
10,523
|
|
|
23,744
|
|
Changes in assets and
liabilities:
|
|
|
|
Inventories
|
1,472
|
|
|
(6,719)
|
|
Prepaid expenses and
other assets
|
(7,565)
|
|
|
358
|
|
Income tax
receivable
|
26,749
|
|
|
(28,562)
|
|
Accounts
payable
|
(13,015)
|
|
|
(12,101)
|
|
Accrued and other
liabilities
|
18,659
|
|
|
16,248
|
|
Net cash provided by
operating activities
|
230,710
|
|
|
196,991
|
|
Cash Flows From
Investing Activities:
|
|
|
|
Purchases of
marketable securities
|
(50,717)
|
|
|
(52,668)
|
|
Proceeds from sale of
marketable securities
|
50,508
|
|
|
129,000
|
|
Purchases of property
and equipment, net
|
(47,836)
|
|
|
(84,841)
|
|
Proceeds from sale of
land
|
16,217
|
|
|
—
|
|
Proceeds from sale of
Boston Proper net assets
|
—
|
|
|
9,000
|
|
Net cash (used in)
provided by investing activities
|
(31,828)
|
|
|
491
|
|
Cash Flows From
Financing Activities:
|
|
|
|
Proceeds from
borrowings
|
—
|
|
|
124,000
|
|
Payments on
borrowings
|
(7,500)
|
|
|
(31,500)
|
|
Proceeds from
issuance of common stock
|
4,359
|
|
|
10,613
|
|
Excess tax benefit
from stock-based compensation
|
604
|
|
|
3,084
|
|
Dividends
paid
|
(42,254)
|
|
|
(43,729)
|
|
Repurchase of common
stock
|
(101,878)
|
|
|
(302,849)
|
|
Net cash used in
financing activities
|
(146,669)
|
|
|
(240,381)
|
|
Effects of exchange
rate changes on cash and cash equivalents
|
(29)
|
|
|
(501)
|
|
Net increase
(decrease) in cash and cash equivalents
|
52,184
|
|
|
(43,400)
|
|
Cash and Cash
Equivalents, Beginning of period
|
89,951
|
|
|
133,351
|
|
Cash and Cash
Equivalents, End of period
|
$
|
142,135
|
|
|
$
|
89,951
|
|
Supplemental
Detail on Earnings Per Share Calculation
|
|
In accordance with
accounting guidance, unvested share-based payment awards that
include non-forfeitable rights to dividends, whether paid or
unpaid, are considered participating securities. As a result, such
awards are required to be included in the calculation of earnings
per common share pursuant to the "two-class" method. For the
Company, participating securities are composed entirely of unvested
restricted stock awards and performance-based restricted stock
units ("PSUs") that have met their relevant performance
criteria.
|
|
Earnings per share is
determined using the two-class method when it is more dilutive than
the treasury stock method. Basic earnings per share is computed by
dividing net income available to common stockholders by the
weighted-average number of common shares outstanding during the
period. Diluted earnings per share reflects the dilutive effect of
potential common shares from non-participating securities such as
stock options and PSUs. For the thirteen weeks and fifty-two weeks
ended January 28, 2017 and January 30, 2016, potential
common shares were excluded from the computation of diluted EPS to
the extent they were antidilutive.
|
|
The following
unaudited table sets forth the computation of basic and diluted
earnings per share shown on the face of the accompanying condensed
consolidated statements of income (loss) (in thousands, except per
share amounts):
|
|
|
Thirteen Weeks
Ended
|
|
Fifty-Two Weeks
Ended
|
|
January 28,
2017
|
|
January 30,
2016
|
|
January 28,
2017
|
|
January 30,
2016
|
|
|
|
|
|
|
|
|
Numerator
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
13,508
|
|
|
$
|
(21,091)
|
|
|
$
|
91,229
|
|
|
$
|
1,946
|
|
Net income and
dividends declared allocated to participating securities
|
(258)
|
|
|
—
|
|
|
(1,915)
|
|
|
—
|
|
Net income (loss)
available to common shareholders
|
$
|
13,250
|
|
|
$
|
(21,091)
|
|
|
$
|
89,314
|
|
|
$
|
1,946
|
|
Denominator
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding – basic
|
126,489
|
|
|
135,275
|
|
|
128,995
|
|
|
138,366
|
|
Dilutive effect of
non-participating securities
|
416
|
|
|
—
|
|
|
242
|
|
|
375
|
|
Weighted average
common and common equivalent shares outstanding –
diluted
|
126,905
|
|
|
135,275
|
|
|
129,237
|
|
|
138,741
|
|
Net income (loss)
per common share*:
|
|
|
|
|
|
|
|
Basic
|
$
|
0.10
|
|
|
$
|
(0.16)
|
|
|
$
|
0.69
|
|
|
$
|
0.01
|
|
Diluted
|
$
|
0.10
|
|
|
$
|
(0.16)
|
|
|
$
|
0.69
|
|
|
$
|
0.01
|
|
|
*Due to the
differences between quarterly and year-to-date weighted average
share counts and the effect of quarterly rounding to the nearest
cent per diluted share, the year-to-date calculation of GAAP and
non-GAAP diluted EPS may not equal the sum of the
quarters.
|
SEC Regulation G -
The Company reports its consolidated financial results in
accordance with generally accepted accounting principles (GAAP).
However, to supplement these consolidated financial results,
management believes that certain non-GAAP results should be
considered in addition to, not as a substitute for, GAAP measures.
These non-GAAP measures exclude results related to non-continuing
Boston Proper operations as well as certain strategic
charges.
|
|
A reconciliation of
net income (loss) and earnings per diluted share on a GAAP basis to
net income and earnings per diluted share on a non-GAAP basis for
the thirteen weeks and fifty-two weeks ended January 28, 2017
and January 30, 2016 is presented in the table
below:
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks
Ended
|
|
Fifty-Two Weeks
Ended
|
|
January 28,
2017
|
|
January 30,
2016
|
|
January 28,
2017
|
|
January 30,
2016
|
Net income
(loss):
|
|
|
|
|
|
|
|
GAAP
basis
|
$
|
13,508
|
|
|
$
|
(21,091)
|
|
|
$
|
91,229
|
|
|
$
|
1,946
|
|
Goodwill and
intangible impairment charges, net of tax
|
—
|
|
|
17,365
|
|
|
—
|
|
|
88,350
|
|
Restructuring and
strategic charges, net of tax
|
—
|
|
|
9,081
|
|
|
19,422
|
|
|
30,305
|
|
Boston Proper
operating loss, net of tax
|
—
|
|
|
4,666
|
|
|
—
|
|
|
12,904
|
|
Tax benefit related
to the disposition of Boston Proper
|
—
|
|
|
(3,830)
|
|
|
(3,979)
|
|
|
(27,609)
|
|
Non-GAAP adjusted
basis
|
$
|
13,508
|
|
|
$
|
6,191
|
|
|
$
|
106,672
|
|
|
$
|
105,896
|
|
|
|
|
|
|
|
|
|
Net income (loss)
per diluted share:
|
|
|
|
|
|
|
|
GAAP
basis
|
$
|
0.10
|
|
|
$
|
(0.16)
|
|
|
$
|
0.69
|
|
|
$
|
0.01
|
|
Goodwill and
intangible impairment charges, net of tax
|
—
|
|
|
0.13
|
|
|
—
|
|
|
0.63
|
|
Restructuring and
strategic charges, net of tax
|
—
|
|
|
0.07
|
|
|
0.15
|
|
|
0.21
|
|
Boston Proper
operating loss, net of tax
|
—
|
|
|
0.03
|
|
|
—
|
|
|
0.09
|
|
Tax benefit related
to the disposition of Boston Proper
|
—
|
|
|
(0.02)
|
|
|
(0.03)
|
|
|
(0.19)
|
|
Non-GAAP adjusted
basis
|
$
|
0.10
|
|
|
$
|
0.05
|
|
|
$
|
0.81
|
|
|
$
|
0.75
|
|
|
*Due to the
differences between quarterly and year-to-date weighted average
share counts and the effect of quarterly rounding to the nearest
cent per diluted share, the year-to-date calculation of GAAP and
non-GAAP diluted EPS may not equal the sum of the
quarters.
|
SEC Regulation G -
The Company reports its consolidated financial results in
accordance with GAAP. However, to supplement these consolidated
financial results, management believes that certain non-GAAP
results, which exclude results from non-continuing Boston Proper
operations, may provide a more meaningful measure on which to
compare the Company's results of operations between
periods.
|
|
The tables below
present a reconciliation of selected consolidated financial data on
a GAAP basis to selected consolidated financial data on a non-GAAP
adjusted basis, reflecting certain adjustments as identified in the
footnotes to the table and excluding Boston Proper:
|
|
Chico's FAS, Inc.
and Subsidiaries
|
Fiscal 2015
Reconciliation of Reported to Adjusted Selected Non-GAAP
Consolidated Financial Data
|
(Unaudited)
|
(in
thousands)
|
|
|
|
|
|
|
|
|
As
Reported
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks
Ended
|
|
Fifty-Two Weeks
Ended
|
|
January 30,
2016
|
|
January 30,
2016
|
|
Amount
|
|
% of
Sales
|
|
Amount
|
|
% of
Sales
|
Net Sales
|
$
|
627,400
|
|
|
100.0
|
|
|
$
|
2,642,309
|
|
|
100.0
|
|
Cost of goods
sold
|
308,863
|
|
|
49.2
|
|
|
1,211,552
|
|
|
45.9
|
|
Gross
margin
|
318,537
|
|
|
50.8
|
|
|
1,430,757
|
|
|
54.1
|
|
Selling, general and
administrative expenses
|
318,356
|
|
|
50.7
|
|
|
1,282,585
|
|
|
48.5
|
|
Subtotal
|
181
|
|
|
0.1
|
|
|
148,172
|
|
|
5.6
|
|
|
Boston
Proper(4)
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks
Ended
|
|
Fifty-Two Weeks
Ended
|
|
January 30,
2016
|
|
January 30,
2016
|
|
Amount
|
|
% of
Sales
|
|
Amount
|
|
% of
Sales
|
Net Sales
|
$
|
15,671
|
|
|
100.0
|
|
|
$
|
80,972
|
|
|
100.0
|
|
Cost of goods
sold
|
11,790
|
|
|
75.2
|
|
|
49,863
|
|
|
61.6
|
|
Gross
margin
|
3,881
|
|
|
24.8
|
|
|
31,109
|
|
|
38.4
|
|
Selling, general and
administrative expenses
|
11,394
|
|
|
72.7
|
|
|
51,889
|
|
|
64.1
|
|
Subtotal
|
(7,513)
|
|
|
(47.9)
|
|
|
(20,780)
|
|
|
(25.7)
|
|
|
Adjustments,
excluding Boston Proper
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks
Ended
|
|
Fifty-Two Weeks
Ended
|
|
January 30,
2016
|
|
January 30,
2016
|
|
Amount
|
|
% of
Sales
|
|
Amount
|
|
% of
Sales
|
Net
Sales(1)
|
$
|
3,131
|
|
|
0.5
|
|
|
$
|
12,249
|
|
|
0.5
|
|
Store occupancy
expense(2)
|
95,601
|
|
|
15.2
|
|
|
379,742
|
|
|
14.3
|
|
Shipping
expense(3)
|
8,923
|
|
|
1.4
|
|
|
32,427
|
|
|
1.2
|
|
Cost of goods
sold
|
104,524
|
|
|
16.6
|
|
|
412,169
|
|
|
15.5
|
|
Gross
margin
|
(101,393)
|
|
|
(16.1)
|
|
|
(399,920)
|
|
|
(15.0)
|
|
Selling, general and
administrative expenses
|
(101,393)
|
|
|
(16.1)
|
|
|
(399,920)
|
|
|
(15.0)
|
|
Subtotal
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
As Adjusted,
Non-GAAP
|
|
|
|
|
|
|
|
|
|
Thirteen Weeks
Ended
|
|
Fifty-Two Weeks
Ended
|
|
January 30,
2016
|
|
January 30,
2016
|
|
Amount
|
|
% of
Sales
|
|
Amount
|
|
% of
Sales
|
Net Sales
|
$
|
614,860
|
|
|
100.0
|
|
|
$
|
2,573,586
|
|
|
100.0
|
|
Cost of goods
sold
|
401,597
|
|
|
65.3
|
|
|
1,573,858
|
|
|
61.2
|
|
Gross
margin
|
213,263
|
|
|
34.7
|
|
|
999,728
|
|
|
38.8
|
|
Selling, general and
administrative expenses
|
205,569
|
|
|
33.4
|
|
|
830,776
|
|
|
32.3
|
|
Subtotal
|
7,694
|
|
|
1.3
|
|
|
168,952
|
|
|
6.5
|
|
|
|
|
|
|
|
|
|
(1)
Adjustments to net sales represent the correction of an immaterial
error in the classification of shipping revenue, which was
previously classified within SG&A.
|
(2)
Adjustments to store occupancy expense represent the
reclassification of store occupancy expenses, which were previously
classified within SG&A.
|
(3)
Adjustments to shipping expense represent a change in accounting
policy to present shipping expenses within cost of goods sold,
which were previously reported within SG&A.
|
(4) Boston
Proper amounts do not reflect reclassification adjustments for net
sales, gross margin and selling, general and administrative
expenses.
|
Chico's FAS, Inc.
and Subsidiaries
|
Store Count and
Square Footage
|
Thirteen Weeks Ended
January 28, 2017
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
October 29,
2016
|
|
New Stores
|
|
Closures
|
|
January 28,
2017
|
|
|
Store
count:
|
|
|
|
|
|
|
|
|
|
Chico's frontline
boutiques
|
594
|
|
|
1
|
|
|
(8)
|
|
|
587
|
|
|
|
Chico's
outlets
|
117
|
|
|
—
|
|
|
(1)
|
|
|
116
|
|
|
|
Chico's
Canada
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
|
WHBM frontline
boutiques
|
425
|
|
|
1
|
|
|
(3)
|
|
|
423
|
|
|
|
WHBM
outlets
|
71
|
|
|
—
|
|
|
—
|
|
|
71
|
|
|
|
WHBM
Canada
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
|
Soma frontline
boutiques
|
274
|
|
|
2
|
|
|
(1)
|
|
|
275
|
|
|
|
Soma
outlets
|
19
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|
|
Boston Proper
frontline boutiques
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
Total Chico's FAS,
Inc.
|
1,510
|
|
|
4
|
|
|
(13)
|
|
|
1,501
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October 29,
2016
|
|
New Stores
|
|
Closures
|
|
Other changes in
SSF
|
|
January 28,
2017
|
Net selling square
footage (SSF):
|
|
|
|
|
|
|
|
|
|
Chico's frontline
boutiques
|
1,624,232
|
|
|
2,601
|
|
|
(20,103)
|
|
|
—
|
|
|
1,606,730
|
|
Chico's
outlets
|
293,646
|
|
|
—
|
|
|
(2,191)
|
|
|
—
|
|
|
291,455
|
|
Chico's
Canada
|
9,695
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,695
|
|
WHBM frontline
boutiques
|
990,269
|
|
|
1,940
|
|
|
(7,455)
|
|
|
—
|
|
|
984,754
|
|
WHBM
outlets
|
148,457
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
148,457
|
|
WHBM
Canada
|
14,891
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,891
|
|
Soma frontline
boutiques
|
517,994
|
|
|
3,565
|
|
|
(2,101)
|
|
|
487
|
|
|
519,945
|
|
Soma
outlets
|
35,637
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35,637
|
|
Boston Proper
frontline boutiques
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total Chico's FAS,
Inc.
|
3,634,821
|
|
|
8,106
|
|
|
(31,850)
|
|
|
487
|
|
|
3,611,564
|
|
|
As of
January 28, 2017 the Company also sold merchandise through 91
international franchise locations.
|
Chico's FAS, Inc.
and Subsidiaries
|
Store Count and
Square Footage
|
Fifty-Two Weeks Ended
January 28, 2017
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
January 30,
2016
|
|
New Stores
|
|
Closures
|
|
January 28,
2017
|
|
|
Store
count:
|
|
|
|
|
|
|
|
|
|
Chico's frontline
boutiques
|
604
|
|
|
4
|
|
|
(21)
|
|
|
587
|
|
|
|
Chico's
outlets
|
117
|
|
|
—
|
|
|
(1)
|
|
|
116
|
|
|
|
Chico's
Canada
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
|
WHBM frontline
boutiques
|
429
|
|
|
4
|
|
|
(10)
|
|
|
423
|
|
|
|
WHBM
outlets
|
71
|
|
|
—
|
|
|
—
|
|
|
71
|
|
|
|
WHBM
Canada
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
|
Soma frontline
boutiques
|
269
|
|
|
8
|
|
|
(2)
|
|
|
275
|
|
|
|
Soma
outlets
|
18
|
|
|
1
|
|
|
—
|
|
|
19
|
|
|
|
Boston Proper
frontline boutiques
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
Total Chico's FAS,
Inc.
|
1,518
|
|
|
17
|
|
|
(34)
|
|
|
1,501
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January 30,
2016
|
|
New Stores
|
|
Closures
|
|
Other changes in
SSF
|
|
January 28,
2017
|
Net selling square
footage (SSF):
|
|
|
|
|
|
|
|
|
|
Chico's frontline
boutiques
|
1,652,991
|
|
|
10,157
|
|
|
(56,063)
|
|
|
(355)
|
|
|
1,606,730
|
|
Chico's
outlets
|
293,646
|
|
|
—
|
|
|
(2,191)
|
|
|
—
|
|
|
291,455
|
|
Chico's
Canada
|
9,695
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,695
|
|
WHBM frontline
boutiques
|
991,164
|
|
|
8,861
|
|
|
(21,002)
|
|
|
5,731
|
|
|
984,754
|
|
WHBM
outlets
|
148,457
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
148,457
|
|
WHBM
Canada
|
14,891
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,891
|
|
Soma frontline
boutiques
|
507,805
|
|
|
14,573
|
|
|
(3,663)
|
|
|
1,230
|
|
|
519,945
|
|
Soma
outlets
|
33,792
|
|
|
1,845
|
|
|
—
|
|
|
—
|
|
|
35,637
|
|
Boston Proper
frontline boutiques
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total Chico's FAS,
Inc.
|
3,652,441
|
|
|
35,436
|
|
|
(82,919)
|
|
|
6,606
|
|
|
3,611,564
|
|
|
As of
January 28, 2017 the Company also sold merchandise through 91
international franchise locations.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/chicos-fas-inc-reports-fourth-quarter-and-fiscal-year-2016-results-300411134.html
SOURCE Chico's FAS, Inc.