2014 Q1 Form 10-K Financial Statement

#000119312514122028 Filed on March 31, 2014

View on sec.gov

Income Statement

Concept 2014 Q1 2014 2013 Q1
Revenue $471.7M $1.551B $398.1M
YoY Change 18.5% 30.0% 30.41%
Cost Of Revenue $296.7M $994.1M $252.9M
YoY Change 17.32% 31.39% 34.74%
Gross Profit $175.0M $556.9M $145.2M
YoY Change 20.53% 27.59% 23.53%
Gross Profit Margin 37.1% 35.91% 36.47%
Selling, General & Admin $116.7M $502.0M $233.8M
YoY Change -50.09% -0.68% 158.06%
% of Gross Profit 66.69% 90.15% 161.05%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $7.700M $26.50M $7.200M
YoY Change 6.94% 9.05% 5.88%
% of Gross Profit 4.4% 4.76% 4.96%
Operating Expenses $116.7M $502.0M $233.8M
YoY Change -50.09% -0.68% 158.06%
Operating Profit $58.28M $54.85M -$88.63M
YoY Change -165.76% -179.45% -429.15%
Interest Expense -$1.500M $5.733M -$1.200M
YoY Change 25.0% -0.74% -25.0%
% of Operating Profit -2.57% 10.45%
Other Income/Expense, Net
YoY Change
Pretax Income $56.70M $49.12M -$89.80M
YoY Change -163.14% -165.66% -454.94%
Income Tax $30.10M $30.92M -$61.40M
% Of Pretax Income 53.09% 62.96%
Net Earnings $26.64M $18.20M -$28.36M
YoY Change -193.94% -242.27% -217.91%
Net Earnings / Revenue 5.65% 1.17% -7.13%
Basic Earnings Per Share $0.68 $0.47
Diluted Earnings Per Share $0.65 $0.45 -$795.5K
COMMON SHARES
Basic Shares Outstanding 39.01M shares 38.67M
Diluted Shares Outstanding 41.12M shares 40.42M

Balance Sheet

Concept 2014 Q1 2014 2013 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $13.40M $13.40M $8.400M
YoY Change 59.52% 59.52% -1.18%
Cash & Equivalents $13.39M $13.40M $8.354M
Short-Term Investments $0.00
Other Short-Term Assets $124.6M $124.6M $1.339M
YoY Change 9205.45% 9.3% -76.26%
Inventory $453.8M $453.8M $353.3M
Prepaid Expenses $11.48M
Receivables $22.03M $22.00M $17.04M
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $613.8M $613.8M $492.8M
YoY Change 24.57% 24.55% 52.61%
LONG-TERM ASSETS
Property, Plant & Equipment $214.9M $214.9M $111.4M
YoY Change 92.91% 92.91% 33.33%
Goodwill $122.4M $122.6M
YoY Change -0.14% 0.0%
Intangibles $47.41M $47.41M
YoY Change 0.0% 0.66%
Long-Term Investments
YoY Change
Other Assets $8.267M $25.20M $5.852M
YoY Change 41.27% 98.43% 10.42%
Total Long-Term Assets $411.3M $411.3M $296.9M
YoY Change 38.55% 38.58% 12.47%
TOTAL ASSETS
Total Short-Term Assets $613.8M $613.8M $492.8M
Total Long-Term Assets $411.3M $411.3M $296.9M
Total Assets $1.025B $1.025B $789.6M
YoY Change 29.82% 29.83% 34.56%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $116.3M $116.3M $81.61M
YoY Change 42.52% 42.52% 72.02%
Accrued Expenses $90.50M $90.50M $63.70M
YoY Change 42.07% 42.07% 9.26%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $1.800M $1.800M $2.900M
YoY Change -37.93% -37.93% -29.27%
Total Short-Term Liabilities $317.4M $317.4M $219.4M
YoY Change 44.67% 44.67% 35.47%
LONG-TERM LIABILITIES
Long-Term Debt $118.6M $121.7M $82.50M
YoY Change 43.76% 47.52% -32.54%
Other Long-Term Liabilities $6.066M $40.70M $5.293M
YoY Change 14.6% 12.74% -47.43%
Total Long-Term Liabilities $6.066M $162.4M $5.293M
YoY Change 14.6% 36.93% -47.43%
TOTAL LIABILITIES
Total Short-Term Liabilities $317.4M $317.4M $219.4M
Total Long-Term Liabilities $6.066M $162.4M $5.293M
Total Liabilities $479.8M $479.8M $338.0M
YoY Change 41.96% 41.95% 0.49%
SHAREHOLDERS EQUITY
Retained Earnings -$37.29M -$55.49M
YoY Change -32.79% 29.95%
Common Stock $4.000K $4.000K
YoY Change 0.0%
Preferred Stock
YoY Change
Treasury Stock (at cost) $2.710M
YoY Change
Treasury Stock Shares 40.35K shares 0.000 shares
Shareholders Equity $545.3M $545.3M $451.6M
YoY Change
Total Liabilities & Shareholders Equity $1.025B $1.025B $789.6M
YoY Change 29.82% 29.83% 34.56%

Cashflow Statement

Concept 2014 Q1 2014 2013 Q1
OPERATING ACTIVITIES
Net Income $26.64M $18.20M -$28.36M
YoY Change -193.94% -242.27% -217.91%
Depreciation, Depletion And Amortization $7.700M $26.50M $7.200M
YoY Change 6.94% 9.05% 5.88%
Cash From Operating Activities $57.00M $87.52M $16.10M
YoY Change 254.04% -2365.04% -75.38%
INVESTING ACTIVITIES
Capital Expenditures -$36.30M $93.87M -$23.50M
YoY Change 54.47% 91.34% 305.17%
Acquisitions
YoY Change
Other Investing Activities
YoY Change
Cash From Investing Activities -$36.30M -$93.87M -$23.50M
YoY Change 54.47% 90.14% 305.17%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $2.710M
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -15.50M 11.51M 100.0K
YoY Change -15600.0% -78.31% -100.16%
NET CHANGE
Cash From Operating Activities 57.00M 87.52M 16.10M
Cash From Investing Activities -36.30M -93.87M -23.50M
Cash From Financing Activities -15.50M 11.51M 100.0K
Net Change In Cash 5.200M 5.158M -7.300M
YoY Change -171.23% -2965.56% 356.25%
FREE CASH FLOW
Cash From Operating Activities $57.00M $87.52M $16.10M
Capital Expenditures -$36.30M $93.87M -$23.50M
Free Cash Flow $93.30M -$6.347M $39.60M
YoY Change 135.61% -88.01% -44.38%

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The loan, together will all interest accrued but unpaid, is due and payable on the first to occur of (i) December 31, 2015, (ii) ninety days following termination of employment, (iii) the date of any sale of the Company, (iv) the date of an initial public offering, (v) the date of any acceleration that might occur as a result of a defined default under the note, or (vi) demand for repayment by Home Holdings.
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CY2014 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions Expected Dividend Rate
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pure
CY2014 us-gaap Net Cash Provided By Used In Operating Activities
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CY2014 us-gaap Fiscal Period
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<div> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt"> <b>Fiscal Years</b></p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt; TEXT-INDENT: 4%"> The Company&#x2019;s fiscal year ends on the Saturday closest to January&#xA0;31. As a result, the Company&#x2019;s fiscal year may include 53 weeks. The fiscal years ended February&#xA0;1, 2014 (&#x201C;fiscal 2013&#x201D;) and January&#xA0;28, 2012 (&#x201C;fiscal 2011&#x201D;) each consisted of 52 weeks. The fiscal year ended February&#xA0;2, 2013 (&#x201C;fiscal 2012&#x201D;) consisted of 53 weeks.</p> </div>
CY2014 us-gaap Weighted Average Number Of Shares Outstanding Basic
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38671564 shares
CY2014 us-gaap Revenue Recognition Leases
RevenueRecognitionLeases
<div> <p style="MARGIN-BOTTOM: 0px; MARGIN-TOP: 18px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Lease Accounting</b></font></p> <p style="MARGIN-BOTTOM: 0px; MARGIN-TOP: 6px; TEXT-INDENT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">The Company leases stores, distribution facilities, office space and certain machinery and equipment under various leases. The Company classifies leases at the inception of the lease as a build-to-suit lease, a capital lease or an operating lease.</font></p> <p style="MARGIN-BOTTOM: 0px; MARGIN-TOP: 12px; TEXT-INDENT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">The Company is sometimes involved in the construction of leased stores. As a result of this involvement, the Company is deemed the &#x201C;owner&#x201D; for accounting purposes during the construction period, and is required to capitalize the construction costs on its consolidated balance sheets (referred to as build-to-suit leases). The Company establishes assets and liabilities for the estimated construction costs incurred under build-to-suit lease arrangements to the extent it is involved in the construction of structural improvements or takes construction risk prior to commencement of a lease. Upon completion of the project, the Company performs a sale-leaseback analysis pursuant to Accounting Standards Codification (&#x201C;ASC&#x201D;) 840 &#x2013; <i>Leases</i>, to determine if it can remove the assets from its consolidated balance sheets. In many of its leases, the Company is reimbursed a portion of the construction costs via adjusted rental payments and/or cash payments or has terms which fix the rental payments for a significant percentage of the leased asset&#x2019;s economic life. These items generally are considered &#x201C;continuing involvement,&#x201D; which precludes the Company from derecognizing the assets from its consolidated balance sheets when construction is complete. In conjunction with these leases, the Company also records financing obligations equal to the cash proceeds or fair market value of the assets received from the landlord. At the end of the lease term, including exercise of any renewal options, the net remaining financing obligation over the net carrying value of the fixed asset will be recognized as a non-cash gain on sale of the property. The Company does not report rent expense for the properties which are owned for accounting purposes. Rather, rental payments under the lease are recognized as a reduction of the financing obligation and interest expense.</font></p> <p style="MARGIN-BOTTOM: 0px; FONT-SIZE: 1px; MARGIN-TOP: 12px"> &#xA0;</p> <p style="MARGIN-BOTTOM: 0px; MARGIN-TOP: 0px; TEXT-INDENT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">During fiscal 2013, the Company determined that lease agreements for four future Full Line Design Gallery locations met the capitalization criteria under ASC 840. As a result, the Company recorded approximately $33&#xA0;million related to build-to-suit transactions, which is recorded within property and equipment, and other long-term obligations on the consolidated balance sheets.</font></p> <p style="MARGIN-BOTTOM: 0px; MARGIN-TOP: 12px; TEXT-INDENT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">In a capital or an operating lease, the expected lease term begins with the date that the Company takes possession of the equipment or the leased space for construction and other purposes. The expected lease term may also include the exercise of renewal options if the exercise of the option is determined to be reasonably assured. The expected term is also used in the determination of whether a store is a capital or operating lease.</font></p> <p style="MARGIN-BOTTOM: 0px; MARGIN-TOP: 12px; TEXT-INDENT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">Some of the Company&#x2019;s equipment is held under capital leases. These assets are included in property and equipment and depreciated over the term of the lease. The Company does not report rent expense for capital leases. Rather, rental payments under the lease are recognized as a reduction of the capital lease obligation and interest expense.</font></p> <p style="MARGIN-BOTTOM: 0px; MARGIN-TOP: 12px; TEXT-INDENT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">All other leases are considered operating leases in accordance with ASC 840. Assets subject to an operating lease and the related lease payments are not recorded on the consolidated balance sheets. For leases that contain lease incentives, premiums and minimum rental expenses, the Company recognizes rental expense on a straight-line basis over the lease term, including the construction period. The Company records rental expense during the construction period. Tenant improvement allowances received from landlords are recorded as deferred rent, reported as a long-term liability on the consolidated balance sheets, and are amortized on a straight-line basis over the lease term, including the construction period.</font></p> </div>
CY2014 us-gaap Revenue Recognition Gift Cards
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<div> <p style="MARGIN-BOTTOM: 0px; MARGIN-TOP: 18px"><font style="FONT-FAMILY: Times New Roman" size="2"><b>Gift Certificates and Merchandise Credits</b></font></p> <p style="MARGIN-BOTTOM: 0px; MARGIN-TOP: 6px; TEXT-INDENT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">The Company sells gift certificates and issues merchandise credits to its customers in its stores and through its websites and product catalogs. Such gift certificates and merchandise credits do not have expiration dates. Revenue associated with gift certificates and merchandise credits is deferred until either (i)&#xA0;redemption of the gift certificate and merchandise credits or (ii)&#xA0;when the likelihood of redemption is remote and there exists no legal obligation to remit the value of unredeemed gift certificates or merchandise credits to the relevant jurisdictions (breakage). The breakage rate is based on monitoring of certificates issued, actual certificate redemptions and the Company&#x2019;s analysis of when it believes it is remote that redemptions will occur.</font></p> <p style="MARGIN-BOTTOM: 0px; MARGIN-TOP: 12px; TEXT-INDENT: 4%"> <font style="FONT-FAMILY: Times New Roman" size="2">Redeemed gift certificates and merchandise credits are recorded in net revenues. Breakage resulted in a reduction of selling, general and administrative expenses on the consolidated statements of operations of $2.9&#xA0;million, $1.8 million, and $3.2 million in fiscal 2013, fiscal 2012, and fiscal 2011, respectively.</font></p> </div>
CY2014 us-gaap Receivable With Imputed Interest Due Dates
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2018-12-31
CY2014 us-gaap Line Of Credit Facility Interest Rate During Period
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0.0280 pure
CY2014 us-gaap Concentration Risk Credit Risk
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<div> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 18pt"> <b>Concentration of Credit Risk</b></p> <p style="MARGIN-BOTTOM: 0pt; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman; MARGIN-TOP: 6pt; TEXT-INDENT: 4%"> The Company maintains its cash and cash equivalent accounts in financial institutions in both U.S. dollar and Canadian dollar denominations. Accounts at the U.S. institutions are insured by the Federal Deposit Insurance Corporation (&#x201C;FDIC&#x201D;) up to $250,000 and accounts at the Canadian institutions are insured by the Canada Deposit Insurance Corporation (&#x201C;CDIC&#x201D;) up to $100,000 Canadian dollars. As of February&#xA0;1, 2014, the Company had four U.S. bank account balances that were in excess of the FDIC insurance limit and three Canadian bank account balance that was in excess of the CIDC insurance limit. The Company performs ongoing evaluations of these institutions to limit its concentration of credit risk.</p> </div>
CY2014 us-gaap Effective Income Tax Rate Reconciliation State And Local Income Taxes
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0.058 pure
CY2014 us-gaap Effective Income Tax Rate Reconciliation Nondeductible Expense Share Based Compensation Cost
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CY2014 us-gaap Related Party Transaction Rate
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CY2014 us-gaap Use Of Estimates
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CY2014 us-gaap Revenue Recognition Deferred Revenue
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CY2014 us-gaap Increase Decrease In Prepaid Deferred Expense And Other Assets
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22819000
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4204000
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3685000
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178000
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1385000
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151000
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11505000
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66686000
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5602000
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5602000
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27654000
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5035000
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4182000
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0
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CY2014 rh Valuation Allowance Charged To Costs And Expenses
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CY2014 rh Net Operating Loss Carry Forwards Expiration Dates
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2033
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CY2013 us-gaap Weighted Average Number Of Diluted Shares Outstanding
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CY2013 us-gaap Effective Income Tax Rate Reconciliation At Federal Statutory Income Tax Rate
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