Boot barn holdings, inc. announces first quarter fiscal year 2021 financial results
Irvine, calif.--(business wire)--boot barn holdings, inc. (nyse: boot) today announced its financial results for the first fiscal quarter ended june 27, 2020. for the quarter ended june 27, 2020: net sales decreased 20.5% to $147.8 million. same store sales decreased 14.9%, comprised of a decrease in retail store same store sales of 27.1% and an increase in e-commerce sales of 51.9%. net loss was $0.5 million, or $0.02 per diluted share, compared to net income of $9.7 million, or $0.33 per diluted share in the prior-year period. net income per diluted share in the prior-year period includes a $0.01 per share benefit due to income tax accounting for share-based compensation. the company opened 5 new stores during the quarter. cash and cash equivalents increased to $83.1 million. jim conroy, chief executive officer, commented, “i am proud of how our organization has navigated through the difficulties created by the covid-19 pandemic. we quickly adapted our operations to meet the current needs of our customers in stores and online while taking a number of precautionary measures. during our first fiscal quarter we drove a sequential increase in same store sales each month, improving from negative 45% in april to positive 3% growth in june. we also enacted operating expense reduction measures to help minimize the impact on our bottom line from the temporary slowdown in sales. despite our lower sales volume, we were able to reduce our average comp store inventory by 3% versus last year, which is a significant improvement from our year-end position. selling through our inventory at a healthy margin allowed us to increase cash and reduce vendor accounts payable while maintaining our year-end debt levels. the significant reduction in inventories compared with the fiscal 2020 year-end balance, fueled a strong gain in operating cash flow compared to the prior year period.” mr. conroy continued, “as our second fiscal quarter got underway, we continued to see a strong correlation between our customers’ shopping behavior and the number of positive covid-19 test results in their communities. while july got off to a slow start due to the resurgence in cases, same store sales in our retail stores sequentially improved from mid-july through the first week of our fiscal august as sentiment improved. with the exception of temporary store closures due to covid-19, we are fortunate to have all of our stores open and believe we are well positioned to reengage in growth when customer confidence in store shopping returns. we have the leading brand in our industry, an extremely loyal customer base, expanded omni channel capabilities and a strong cash position. this combination should enable us to weather these unprecedented times and emerge even stronger post covid-19.” operating results for the first quarter ended june 27, 2020 net sales decreased 20.5% to $147.8 million from $185.8 million in the prior-year period. consolidated same store sales decreased 14.9% with retail store same store sales down 27.1% and e-commerce same store sales up 51.9%. the decrease in retail store sales was primarily a result of decreased traffic in our stores that resulted from customers staying at home in response to the covid-19 crisis and temporary store closures. gross profit was $40.2 million, or 27.2% of net sales, compared to $62.2 million, or 33.5% of net sales, in the prior-year period. gross profit decreased primarily due to decreased sales resulting from the covid-19 crisis. the decrease in gross profit rate of 630 basis points was driven by 430 basis points of deleverage in buying and occupancy costs and a 200-basis point decline in merchandise margin rate. the deleverage in buying and occupancy costs was primarily a result of lower volume sales. merchandise margin declined 200 basis points primarily as a result of outsized growth in our e-commerce channel as a percent of sales. of the 200-basis point decline in merchandise margin, 160 basis points is attributable to the increased sales penetration of the lower merchandise margin e-commerce business and 30 basis points is related to a write-down of discontinued inventory at the recently acquired g&l clothing work-only store. selling, general and administrative expenses were $38.4 million, or 26.0% of net sales, compared to $46.1 million, or 24.8% of net sales, in the prior-year period. the decrease in selling, general and administrative expenses was primarily a result of lower store payroll, reduced marketing expenses and lower overhead. selling, general and administrative expenses as a percentage of sales increased by 120 basis points as a result of deleverage from lower sales. income from operations decreased 88.8% to $1.8 million, or 1.2% of net sales, compared to $16.1 million, or 8.6% of net sales, in the prior-year period. this decline in income from operations is a result of the negative impact on sales, gross margin and selling, general and administrative expenses due to the covid-19 crisis. net loss was $0.5 million, or $0.02 per diluted share, compared to net income of $9.7 million, or $0.33 per diluted share in the prior-year period. net income per diluted share in the prior-year period includes a $0.01 per share benefit due to income tax accounting for share-based compensation. current business the following table includes same store sales, net sales and e-commerce as a percentage of net sales for the periods indicated below: (64)% (26)% (2)% (27)% (15)% (13)% 46% 82% 33% 52% 24% 15% (45)% (10)% 3% (15)% (10)% (9)% (54)% (17)% 4% (21)% (7)% (5)% 39% 29% 18% 25% 18% 17% fiscal year 2021 outlook the covid-19 crisis continues to adversely affect the company’s results. due to the ongoing uncertainty created by covid-19, the company is not providing second quarter and fiscal year 2021 guidance at this time. conference call information a conference call to discuss the financial results for the first quarter of fiscal year 2021 is scheduled for today, august 4, 2020, 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 september 4, 2020, by dialing (844) 512-2921 (domestic) or (412) 317-6671 (international) and entering the conference identification number: 13707642. 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 264 stores in 36 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) june 27, march 28, 2020 2020 83,123 69,563 10,703 12,087 261,546 288,717 13,475 14,284 368,847 384,651 109,327 109,603 164,698 170,243 197,502 197,502 60,952 60,974 2,127 1,738 903,453 924,711 129,900 129,900 80,702 95,334 49,306 52,612 34,955 34,779 294,863 312,625 20,145 19,801 109,212 109,022 155,643 160,935 1,044 635 580,907 603,018 3 3 — — 171,077 169,249 153,151 153,641 (1,685 ) (1,200 ) 322,546 321,693 903,453 924,711 boot barn holdings, inc. consolidated statements of operations (in thousands, except per share data) (unaudited) june 27, june 29, 2020 2019 147,766 185,767 107,565 123,611 40,201 62,156 38,403 46,095 1,798 16,061 2,641 3,904 64 11 (779 ) 12,168 (289 ) 2,447 (490 ) 9,721 (0.02 ) 0.34 (0.02 ) 0.33 28,826 28,380 28,826 29,025 boot barn holdings, inc. consolidated statements of cash flows (in thousands) (unaudited) june 27, june 29, 2020 2019 (490 ) 9,721 5,688 4,770 1,824 965 22 32 8,277 7,424 221 281 (4 ) 12 — (193 ) 344 (1,047 ) 1,872 1,612 27,171 (13,161 ) 778 (867 ) (389 ) (274 ) (11,096 ) (6,486 ) (3,306 ) 2,719 409 249 (8,188 ) (7,306 ) 23,133 (1,549 ) (8,944 ) (6,822 ) (8,944 ) (6,822 ) — 80,001 (148 ) (65,147 ) — (1,203 ) (485 ) (422 ) 4 1,267 (629 ) 14,496 13,560 6,125 69,563 16,614 83,123 22,739 10 201 2,696 3,370 2,159 2,879 boot barn holdings, inc. store count quarter ended quarter ended quarter ended quarter ended quarter ended quarter ended quarter ended quarter ended june 27, march 28, december 28, september 28, june 29, march 30, december 29, september 29, 2020 2020 2019 2019 2019 2019 2018 2018 259 251 248 240 240 234 232 230 5 8 3 8 1 6 2 3 — — — — (1 ) — — (1 ) 264 259 251 248 240 240 234 232 boot barn holdings, inc. selected store data june 27, march 28, december 28, september 28, june 29, march 30, december 29, september 29, 2020 2020 2019 2019 2019 2019 2018 2018 (14.9 ) % (4.7 ) % 6.7 % 7.8 % 9.4 % 8.7 % 9.2 % 11.3 % 264 259 251 248 240 240 234 232 2,770 2,722 2,639 2,616 2,537 2,539 2,486 2,472 10,491 10,508 10,514 10,549 10,570 10,580 10,624 10,654 410 590 903 635 660 666 862 602 debt covenant ebitda reconciliation (unaudited) (490 ) 5,729 24,819 7,680 9,721 (289 ) 930 7,040 1,947 2,447 2,641 2,941 3,155 3,310 3,904 5,710 5,872 5,682 5,027 4,802 7,572 15,472 40,696 17,964 20,874 1,824 1,582 1,181 1,180 965 (302 ) (447 ) 575 (11 ) 97 (4 ) 28 377 - 12 - - 7 - (193 ) - 191 - - - 9,090 16,826 42,836 19,133 21,755 1,590 2,269 1,404 1,442 847 10,680 19,095 44,240 20,575 22,602
