Boot barn holdings, inc. announces third quarter fiscal year 2022 financial results
Irvine, calif.--(business wire)--boot barn holdings, inc. (nyse: boot) today announced its financial results for the third fiscal quarter ended december 25, 2021. due to the impact of covid-19 on the company’s results in its third fiscal quarter ended december 26, 2020, it has provided the below quarterly highlights in comparison to its third fiscal quarter ended december 28, 2019, two years ago. for the quarter ended december 25, 2021: net sales increased 71.1% to $485.9 million, compared to the quarter ended december 28, 2019, two years ago. compared to the quarter ended december 28, 2019, same store sales increased 61.0%, comprised of an increase in retail store same store sales of 59.1% and an increase in e-commerce same store sales of 69.3%. net income was $69.2 million, or $2.27 per diluted share, compared to $24.8 million, or $0.85 per diluted share in the two-year ago period. net income per diluted share in both the current-year and two-year ago periods include an approximately $0.04 per share benefit due to income tax accounting for share-based compensation. excluding the tax benefit in both periods, net income per diluted share in the current-year period was $2.23, compared to $0.81 in the two-year ago period. the company opened 11 new stores during the thirteen weeks ended december 25, 2021. the company has also provided the below table which includes year-over-year comparisons of retail store sales, e-commerce sales, and total net sales for each of the periods indicated below. in addition, the following table includes retail store sales and e-commerce sales as a percentage of total net sales for the periods indicated below: 396,463 242,369 231,537 64 % 71 % 89,441 59,969 52,461 49 % 70 % 485,904 302,338 283,998 61 % 71 % 82 % 80 % 82 % 18 % 20 % 18 % “our strong third quarter results once again demonstrate boot barn is a high growth retailer with significant opportunity ahead of us,” said jim conroy, president and chief executive officer. “we increased top-line sales in excess of 64% in each of the first three quarters of fiscal 2022 compared to pre-pandemic levels two years ago and surpassed $1 billion in sales for the first nine-months of this fiscal year, which is greater than any full year period in the company’s history. on a year to date basis, we expanded merchandise margin 330 basis points and improved earnings per share 235% compared to the same period two years ago. we continue to demonstrate that we have increased the size of our target market as we have extended beyond our legacy western customer. we believe that this expansion has resulted in the tremendous sales growth we have seen with strength in both our store and online channels. importantly, this top-line growth has been accompanied by multiple years of merchandise margin expansion and outsized growth in earnings. i do want to commend the entire boot barn team for overcoming the challenges associated with supply chain, labor shortage and inflation that seem to be disrupting much of the retail landscape. operating results for the third quarter ended december 25, 2021 compared to the third quarter ended december 26, 2020 net sales increased 60.7% to $485.9 million from $302.3 million in the prior-year period. consolidated same store sales increased 54.2% with retail store same store sales up 55.7% and e-commerce same store sales up 48.4%. the increase in net sales was the result of an increase of 54.2% in consolidated same store sales and the incremental sales from new stores opened over the past twelve months. gross profit was $191.7 million, or 39.4% of net sales, compared to $106.8 million, or 35.3% of net sales, in the prior-year period. gross profit increased primarily due to increased sales. the increase in gross profit rate of 410 basis points was driven by 140 basis points of leverage in buying and occupancy costs as a result of expense leverage on higher sales and a 270-basis point increase in merchandise margin. merchandise margin increased 270 basis points primarily as a result of better full-price selling and growth in exclusive brand penetration. selling, general and administrative expenses were $99.5 million, or 20.5% of net sales, compared to $65.2 million, or 21.6% of net sales, in the prior-year period. the increase in selling, general and administrative expenses was primarily a result of higher store payroll, higher store overhead and increased marketing expenses in the current-year period compared to the prior-year period. selling, general and administrative expenses as a percentage of net sales decreased by 110 basis points primarily as a result of expense leverage on higher sales. income from operations increased $50.6 million to $92.2 million, or 19.0% of net sales, compared to $41.6 million, or 13.8% of net sales, in the prior-year period. this increase represents 520 basis points of improvement in operating profit margin. net income was $69.2 million, or $2.27 per diluted share, compared to a net income of $29.6 million, or $1.00 per diluted share in the prior-year period. net income per diluted share in the current-year period includes an approximately $0.04 per share benefit due to income tax accounting for share-based compensation compared to a $0.01 per share benefit in the prior-year period. excluding the tax benefit in the current year period, net income per diluted share in the current-year period was $2.23, compared to net income per diluted share of $0.99 in the prior-year period. operating results for the nine months ended december 25, 2021 compared to the nine months ended december 26, 2020 net sales increased 74.1% to $1.1 billion from $634.6 million in the prior-year period. consolidated same store sales increased 61.8% with retail store same store sales up 68.7% and e-commerce same store sales up 35.8%. the increase in net sales was the result of an increase of 61.8% in consolidated same store sales, the incremental sales from new stores opened over the past twelve months, and the sales contribution from temporarily closed stores that were excluded from the comp base. net sales in the prior-year period were adversely impacted by decreases in retail store sales resulting from decreased traffic in our stores from customers staying at home in response to the covid-19 crisis and temporary store closures. gross profit was $426.2 million, or 38.6% of net sales, compared to $202.5 million, or 31.9% of net sales, in the prior-year period. gross profit increased primarily due to increased sales. the increase in gross profit rate of 670 basis points was driven by 340 basis points of leverage in buying and occupancy costs as a result of expense leverage on higher sales and a 330 basis point increase in merchandise margin. merchandise margin increased 330 basis points primarily as a result of better full-price selling, increased penetration of store sales compared to the prior year, and growth in exclusive brand penetration. selling, general and administrative expenses were $230.3 million, or 20.8% of net sales, compared to $149.0 million, or 23.5% of net sales, in the prior-year period. the increase in selling, general and administrative expenses was primarily a result of higher store payroll, higher store overhead and increased marketing expenses in the current-year period compared to the prior-year period which was impacted by covid-19.selling, general and administrative expenses as a percentage of net sales decreased by 260 basis points primarily as a result of expense leverage on higher sales. income from operations increased $142.5 million to $195.9 million, or 17.7% of net sales, compared to $53.5 million, or 8.4% of net sales, in the prior-year period. this increase represents 930 basis points of improvement in operating profit margin. net income was $147.7 million, or $4.86 per diluted share, compared to net income of $34.8 million, or $1.19 per diluted share in the prior-year period. net income per diluted share in the current-year period includes a $0.17 per share benefit due to income tax accounting for share-based compensation compared to a $0.01 per share benefit in the prior-year period. excluding the tax benefit in the current year period, net income per diluted share in the current-year period was $4.69, compared to net income per diluted share of $1.18 in the prior-year period. current business the following table includes retail store sales, e-commerce sales, and total net sales for the periods indicated below. it also includes the year-over-year change in retail store sales, e-commerce sales, and total net sales for each of the periods indicated below: 91,900 61,648 47,189 49 % 95 % 18,300 11,298 11,081 62 % 65 % 110,200 72,946 58,270 51 % 89 % balance sheet highlights as of december 25, 2021 cash of $114.7 million. average inventory per store increased 22.0% on a same store basis compared to december 26, 2020. no debt outstanding. during the quarter the company paid the remaining balance of the $50.0 million term loan and had zero drawn on its revolving credit facility. fiscal year 2022 outlook the company provides the following full-year fiscal 2022 guidance: new unit growth of 10%. exclusive brand penetration growth of 450 basis points compared to full-year fiscal 2021. effective tax rate for the fourth quarter of 25.4%. capital expenditures between $41.0 to $43.0 million. conference call information a conference call to discuss the financial results for the second quarter of fiscal year 2022 is scheduled for today, january 27, 2022, at 4:30 p.m. et (1:30 p.m. pt). investors and analysts interested in participating in the call are invited to (877) 451-6152. 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 february 27, 2022, by dialing (844) 512-2921 (domestic) or (412) 317-6671 (international) and entering the conference identification number: 13726537. 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 293 stores in 37 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: the effect of covid-19 on our business operations, growth strategies, store traffic, employee availability, financial condition, liquidity and cash flow; 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) 2021 2021 114,714 73,148 7,891 12,771 385,642 275,760 54,258 12,777 562,505 374,456 136,716 110,444 226,898 186,827 197,502 197,502 60,831 60,885 3,525 3,467 1,187,977 933,581 189,229 104,641 157,401 77,615 41,741 39,400 388,371 221,656 22,682 21,993 — 109,781 218,915 181,836 4,730 3,424 634,698 538,690 3 3 — — 197,176 183,815 360,764 213,027 (4,664) (1,954) 553,279 394,891 1,187,977 933,581 boot barn holdings, inc. consolidated statements of operations (in thousands, except per share data) (unaudited) 2021 2020 2021 2020 485,904 302,338 1,104,948 634,619 294,245 195,529 678,711 432,119 191,659 106,809 426,237 202,500 99,467 65,183 230,288 149,034 92,192 41,626 195,949 53,466 1,667 2,303 5,392 7,327 43 152 161 294 90,568 39,475 190,718 46,433 21,337 9,909 42,981 11,599 69,231 29,566 147,737 34,834 2.34 1.02 5.01 1.21 2.27 1.00 4.86 1.19 29,637 28,912 29,518 28,866 30,443 29,581 30,382 29,275 boot barn holdings, inc. consolidated statements of cash flows (in thousands) (unaudited) 2021 2020 147,737 34,834 19,800 17,919 7,807 5,011 54 67 28,701 25,342 1,834 663 150 23 (258) 295 — 384 689 (1,150) 5,797 4,242 (109,882) 42,709 (41,596) (818) (608) (687) 84,411 9,753 73,490 42,219 1,306 789 (28,876) (24,991) 190,556 156,604 (39,749) (20,508) (39,749) (20,508) — (129,900) (112,085) (487) (2,710) (535) 5,554 1,605 (109,241) (129,317) 41,566 6,779 73,148 69,563 114,714 76,342 41,694 3,684 3,497 6,731 9,620 3,703 - - boot barn holdings, inc. store count 2021 2021 2021 2021 2020 2020 2020 2020 278 276 273 266 265 264 259 251 11 3 3 8 1 1 5 8 — (1) — (1) — — — — 289 278 276 273 266 265 264 259 boot barn holdings, inc. selected store data 2021 2021 2021 2021 2020 2020 2020 2020 2019 54.2 % 61.7 % 78.9 % 26.9 % 4.6 % (5.1) % (14.9) % (4.7) % 11.3 % 289 278 276 273 266 265 264 259 232 3,063 2,940 2,915 2,854 2,787 2,779 2,770 2,722 2,472 10,597 10,575 10,563 10,455 10,477 10,486 10,491 10,508 10,654 1,372 965 942 792 889 565 410 590 602 debt covenant ebitda reconciliation (unaudited) 69,231 37,861 40,645 24,552 29,566 24,819 21,337 11,105 10,539 6,264 9,909 7,040 1,667 1,162 2,563 2,115 2,303 3,155 6,947 6,737 6,170 6,162 5,994 5,682 99,182 56,865 59,917 39,093 47,772 40,696 1,839 2,767 3,201 2,147 1,482 1,181 828 303 339 (255) 697 575 61 94 (4) 64 (19) 377 (12) (214) (33) - - 7 101,898 59,815 63,420 41,049 49,932 42,836 1,249 1,569 1,046 673 165 1,404 103,147 61,384 64,466 41,722 50,097 44,240
