May 02, 2017
1-800-FLOWERS.COM, Inc. Reports Results for Its Fiscal 2017 Third Quarter
- Total revenues were $233.7 million compared with $234.2 million in
the prior year period. Strong growth of 10.2 percent and 7.0 percent
in the Company’s Consumer Floral and BloomNet segments, respectively,
was offset by lower year-over-year revenues in its Gourmet Food and
Gift Baskets segment due primarily to the shift of the Easter holiday
into the Company’s fiscal fourth quarter.
- EBITDA, excluding stock-based compensation expense, was a loss of
$6.5 million, compared with a loss of $4.0 million in the prior year
period, primarily reflecting the impact of the Easter holiday shift.
- GAAP EPS loss for the quarter was $0.17, compared with a GAAP EPS
loss of $0.14 per share in the prior year period, also primarily
reflecting the impact of the Easter holiday shift.
CARLE PLACE, N.Y.--(BUSINESS WIRE)--
1-800-FLOWERS.COM, Inc. (NASDAQ:FLWS), the leading gourmet food and
floral gift provider for all occasions, today reported results for its
Fiscal 2017 third quarter ended April 2, 2017.
Chris McCann, CEO of 1-800-FLOWERS.COM, Inc., said, “During the fiscal
third quarter, we achieved strong performance in our Consumer Floral and
BloomNet segments. Revenues for the 1-800-Flowers.com brand increased
more than 10 percent and contribution margin increased more than 15
percent. BloomNet also achieved solid revenue growth, up 7 percent for
the period, along with 6 percent growth in its bottom-line contribution.
These results illustrate the leverage in our business model as well as
our focus on efficient marketing and merchandising programs combined
with truly original product offerings.”
McCann said that both the Consumer Floral and BloomNet segments
benefited from the shift of the Valentine holiday to a Tuesday day
placement this year. “In our floral businesses, we more than offset the
impact of the Easter shift by continuing to drive strong growth in our
everyday gifting business and maximizing the benefit of the weekday
placement for the Valentine holiday. However, the later Easter date this
year moved significant revenues out of the third quarter in our Gourmet
Food and Gift Baskets segment. Combined with the timing of some Harry &
David revenues, this impacted both top and bottom line results for the
quarter.”
McCann noted that the impact of the Easter shift was anticipated and
said the Company has already recaptured the revenues associated with the
date shift in its current fiscal fourth quarter. “In addition to
recapturing the Easter revenues, during the fourth quarter our Gourmet
Foods and Gift Baskets segment will benefit from the timing of some
Harry & David Fruit-Of-The-Month Club™ shipments. Combined
with the continuing positive trends in Consumer Floral and BloomNet, we
anticipate achieving solid top and bottom-line growth across all three
of our business segments for the fiscal fourth quarter.”
Third Quarter 2017 Financial Results
For the third quarter of 2017, revenues were essentially unchanged at
$233.7 million, compared with total revenues of $234.2 million in the
prior year period. This reflects lower year-over-year revenues in the
Company’s Gourmet Food and Gift Baskets segment due primarily to the
impact of the Easter holiday shifting into the Company’s fiscal fourth
quarter this year. This impact was largely offset by strong revenue
growth in the Company’s Consumer Floral and BloomNet segments which grew
10.2 percent and 7.0 percent, respectively, compared with the prior year
period.
Gross profit margin for the quarter was 40.0 percent, a decrease of 130
basis points compared with 41.3 percent in the prior year period. This
primarily reflects lower gross margin in the Company’s Gourmet Food and
Gift Baskets segments, due largely to the shift of the Easter holiday.
Operating expenses, excluding depreciation and amortization, as a
percent of total revenues improved 30 basis points to 43.4 percent,
compared with 43.7 percent in the prior year period.
The combination of these factors resulted in an EBITDA loss (excluding
stock-based compensation expense) of $6.5 million compared with an
EBITDA loss of $4.0 million in the prior year period. Net loss was $11.1
million, or $0.17 per share, compared with a net loss of $9.1 million,
or $0.14 per share, in the prior year period.
Regarding customer metrics for the quarter, the Company attracted
881,000 new customers. Approximately 1.9 million customers placed orders
during the quarter, of which 53.4 percent were repeat customers. This
reflects the Company’s effective marketing and merchandising programs,
including initiatives in social and mobile communication channels and
its Celebrations suite of services – Celebrations Passport, Celebrations
Rewards and Celebrations Reminders – all designed to engage and deepen
its relationships with its customers.
Segment Results From Continuing Operations:
The Company provides selected financial results for its Consumer Floral,
BloomNet and Gourmet Foods and Gift Baskets segments in the tables
attached to this release and as follows:
- Gourmet Foods and Gift Baskets: Revenues
for the quarter declined 13.6 percent to $85.6 million, compared with
$99.1 million in the prior year period. Gross margin declined 360
basis points to 34.8 percent, compared with 38.4 percent in the prior
year period. Contribution margin loss was $10.8 million compared with
$6.8 million in the prior year period. The revenue, gross margin and
contribution margin declines primarily reflect the impact of the shift
of the Easter holiday as well as the timing of some revenues in the
Company’s Harry & David business.
- Consumer Floral: Fiscal third
quarter revenues in this segment increased 10.2 percent to $124.7
million, compared with $113.2 million in the prior year period. Gross
margin was 40.6 percent, unchanged compared with the prior year
period. Because of these factors, category contribution margin
increased for the eleventh consecutive quarter, up 15.4 percent to
$15.9 million, compared with $13.7 million in the prior year period.
- BloomNet Wire Service: Revenues for the
quarter increased 7.0 percent to $24.1 million, compared with $22.5
million in the prior year period. Gross profit margin was 53.6
percent, a decrease of 140 basis points compared with 55.0 percent in
the prior year period, primarily reflecting product mix. Contribution
margin increased 6.4 percent to $8.2 million compared with $7.7
million in the prior year period.
Company Guidance:
The Company is reiterating its guidance for fiscal 2017 as follows:
-
Consolidated revenue growth for the year in a range of 3-to-4 percent,
compared with revenues of $1.17 billion reported for fiscal 2016.
-
EBITDA growth in a range of 8-to-10 percent compared with Adjusted
EBITDA of $85.8 million reported for fiscal 2016.
-
EPS growth in a range of 5-to-10 percent compared with Adjusted EPS of
$0.43 reported for fiscal 2016.
-
Free Cash Flow for the year of approximately $40 million compared with
$24 million in fiscal 2016.
Note: On March 15, 2017, the Company announced the signing of a
definitive agreement to sell its Fannie May Confections Brands business
to Ferrero International for $115.0 million. Closing for this
transaction is anticipated to be at the end of May. The Company’s
current guidance for fiscal 2017 does not reflect the pending sale.
Definitions:
EBITDA: Net income (loss) before interest, taxes, depreciation,
amortization. Free Cash Flow: net cash provided by operating activities
less capital expenditures. Category contribution margin: earnings before
interest, taxes, depreciation and amortization, before the allocation of
corporate overhead expenses. The Company presents EBITDA, Comparable EPS
and Free Cash Flow because it considers such information meaningful
supplemental measures of its performance and believes such information
is frequently used by the investment community in the evaluation of
similarly situated companies. The Company also uses EBITDA and Adjusted
EBITDA as factors used to determine the total amount of incentive
compensation available to be awarded to executive officers and other
employees. The Company's credit agreement uses EBITDA and Adjusted
EBITDA to measure compliance with covenants such as interest coverage
and debt incurrence. EBITDA and Adjusted EBITDA are also used by the
Company to evaluate and price potential acquisition candidates. EBITDA,
Adjusted EBITDA and Free Cash Flow have limitations as analytical tools
and should not be considered in isolation or as a substitute for
analysis of the Company's results as reported under GAAP. Some of the
limitations of EBITDA and Adjusted EBITDA are: (a) EBITDA and Adjusted
EBITDA do not reflect changes in, or cash requirements for, the
Company's working capital needs; (b) EBITDA and Adjusted EBITDA do not
reflect the significant interest expense, or the cash requirements
necessary to service interest or principal payments, on the Company's
debts; and (c) although depreciation and amortization are non-cash
charges, the assets being depreciated and amortized may have to be
replaced in the future and EBITDA does not reflect any cash requirements
for such capital expenditures. EBITDA and Free Cash Flow should only be
used on a supplemental basis combined with GAAP results when evaluating
the Company's performance.
About 1-800-FLOWERS.COM,
Inc.
1-800-FLOWERS.COM,
Inc. is a leading provider of gourmet food and floral gifts for all
occasions. For the past 40 years, 1-800-FLOWERS® (1-800-356-9377 or www.1800flowers.com) has
been helping deliver smiles for our customers with gifts for every
occasion, including fresh flowers and the finest selection of plants,
gift baskets, gourmet foods, confections, candles, balloons and plush
stuffed animals. As always, our 100% Smile Guarantee® backs every
gift. The company’s Celebrations suite of services including
Celebrations Passport Free Shipping Program, Celebrations Rewards and
Celebrations Reminders, are all designed to engage with customers and
deepen relationships as a one-stop destination for all celebratory and
gifting occasions. In 2016, 1-800-Flowers.com was awarded Silver Stevie
“e-Commerce Customer Service” Award, recognizing the company’s
innovative use of online technologies and social media to service the
needs of customers. In addition, 1-800-FLOWERS.COM, Inc. was recognized
as one of Internet Retailer’s Top 300 B2B e-commerce companies and was
also recently named in Internet Retailer’s 2016 Top Mobile 500 as one of
the world’s leading mobile commerce sites. The company was included in
Internet Retailer’s 2015 Top 500 for fast growing e-commerce companies.
In 2015, 1-800-Flowers.com was named a winner of the “Best Companies to
Work for in New York State” Award by The New York Society for Human
Resource Management (NYS-SHRM). The Company’s BloomNet® international
floral wire service (www.mybloomnet.net) provides
a broad range of quality products and value-added services designed to
help professional florists grow their businesses profitably. The 1-800-FLOWERS.COM,
Inc. “Gift Shop” also includes gourmet gifts such as premium,
gift-quality fruits and other gourmet items from Harry & David®
(1-877-322-1200) or www.harryanddavid.com), popcorn
and specialty treats from The Popcorn Factory® (1-800-541-2676 or www.thepopcornfactory.com); cookies
and baked gifts from Cheryl’s® (1-800-443-8124 or www.cheryls.com); premium
chocolates and confections from Fannie May® (www.fanniemay.com and www.harrylondon.com); gift
baskets and towers from 1-800- Baskets.com® (www.1800baskets.com); premium
English muffins and other breakfast treats from Wolferman’s
(1-800-999-1910 or www.wolfermans.com);
carved fresh fruit arrangements from FruitBouquets.com (www.fruitbouquets.com); and
top quality steaks and chops from Stock Yards® (www.stockyards.com).
Shares in 1-800-FLOWERS.COM, Inc.
are traded on the NASDAQ Global Select Market, ticker symbol: FLWS.
Special Note Regarding Forward-Looking
Statements:
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements represent the Company’s current expectations
or beliefs concerning future events and can generally be identified by
the use of statements that include words such as “estimate,” “expects,”
“project,” “believe,” “anticipate,” “intend,” “plan,” “foresee,”
“likely,” “will,” “target” or similar words or phrases. These
forward-looking statements are subject to risks, uncertainties and other
factors, many of which are outside of the Company’s control which could
cause actual results to differ materially from the results expressed or
implied in the forward- looking statements, including, but are not
limited to, statements regarding the Company’s expectations for:
enhanced performance in its Fannie May business; its ability to continue
to generate solid top and bottom-line growth in its 1-800-Flowers.com
Consumer Floral business; its ability to generate strong revenue growth
in its Cheryl’s, Harry & David, The Popcorn Factory and 1800Baskets
businesses; its ability to continue to grow bottom-line contribution in
its 1-800-Flowers and BloomNet businesses; its ability to leverage its
consolidated customer database and new multi-brand website to attract
and retain customers and help grow revenues; its ability to achieve its
guidance for consolidated revenue growth for the full year in a range of
4-to-5 percent; its ability to achieve EBITDA growth in a range of
8-to-10 percent and EPS in a range of 5-to-10 percent; its ability to
generate Free Cash Flow for the year of approximately $40 million; its
ability to leverage its operating platform and reduce operating expense
ratio; its ability to cost effectively acquire and retain customers; the
outcome of contingencies, including legal proceedings in the normal
course of business; its ability to compete against existing and new
competitors; its ability to manage expenses associated with sales and
marketing and necessary general and administrative and technology
investments; its ability to reduce promotional activities and achieve
more efficient marketing programs; and general consumer sentiment and
economic conditions that may affect levels of discretionary customer
purchases of the Company’s products. The Company undertakes no
obligation to publicly update any of the forward-looking statements,
whether as a result of new information, future events or otherwise, made
in this release or in any of its SEC filings except as may be otherwise
stated by the Company. For a more detailed description of these and
other risk factors, please refer to the Company’s SEC filings including
the Company’s Annual Reports on Form 10-K and its Quarterly Reports on
Form 10-Q. Consequently, you should not consider any such list to be a
complete set of all potential risks and uncertainties.
Conference Call
The Company will conduct a conference call to discuss the above details
and attached financial results today, Tuesday, May 2, 2017 at 11:00 a.m.
(EDT). The call will be “web cast” live via the Internet and can be
accessed from the Investor Relations section of the 1-800-FLOWERS.COM
web site at www.1800flowersinc.com
A recording of the call will be posted on the Investor Relations section
of the Company’s web site within two hours of the call’s completion. A
telephonic replay of the call can be accessed beginning at 2:00 p.m. EDT
on the day of the call through May 9, 2017 at: 1-877-344-7529 or
1-412-317-0088 (international) or 1-855-669-9658 (Canada); Conference
ID: 10105202.
Note: Attached tables are an integral part of this press release
without which the information presented in this press release should be
considered incomplete.
|
|
|
| |
|
| |
1-800-FLOWERS.COM, Inc. and Subsidiaries Condensed Consolidated Balance Sheets
(In thousands)
|
| | | | | | |
|
| | | | April 2, 2017 | | | July 3, 2016 |
| | | | | | |
|
| Assets | | | | | | | |
|
Current assets:
| | | | | | | |
|
Cash and cash equivalents
| | | |
$
|
56,765
| | |
$
|
27,826
|
|
Trade receivables, net
| | | | |
21,549
| | | |
19,123
|
|
Inventories
| | | | |
63,713
| | | |
103,328
|
|
Prepaid and other
| | | | |
17,388
| | | |
16,382
|
|
Assets held for sale
| | | |
|
91,822
| | |
|
-
|
|
Total current assets
| | | | |
251,237
| | | |
166,659
|
| | | | | | |
|
|
Property, plant and equipment, net
| | | | |
154,668
| | | |
171,362
|
|
Goodwill
| | | | |
62,767
| | | |
77,667
|
|
Other intangibles, net
| | | | |
61,441
| | | |
79,000
|
|
Other assets
| | | |
|
9,685
| | |
|
8,253
|
| Total assets | | | | $ | 539,798 | | | $ | 502,941 |
| | | | | | |
|
| Liabilities and Stockholders' Equity | | | | | | | |
|
Current liabilities:
| | | | | | | |
|
Accounts payable
| | | |
$
|
19,457
| | |
$
|
35,201
|
|
Accrued expenses
| | | | |
87,921
| | | |
66,066
|
|
Current maturities of long-term debt
| | | | |
6,469
| | | |
19,594
|
|
Liabilities held for sale
| | | |
|
4,428
| | |
|
-
|
|
Total current liabilities
| | | | |
118,275
| | |
$
|
120,861
|
| | | | | | |
|
|
Long-term debt
| | | | |
103,300
| | | |
94,396
|
|
Deferred tax liabilities
| | | | |
33,628
| | | |
35,517
|
|
Other liabilities
| | | |
|
9,225
| | |
|
9,581
|
| Total liabilities | | | |
| 264,428 | | |
| 260,355 |
| Total equity | | | |
| 275,370 | | |
| 242,586 |
| Total liabilities and equity | | | | $ | 539,798 | | | $ | 502,941 |
| | | | | | | | |
|
|
|
|
| |
|
| |
1-800-FLOWERS.COM, Inc. and Subsidiaries Selected Financial Information Condensed Consolidated Statements of Income
(In thousands, except for per share data)
(unaudited)
|
| | | | | | |
|
| | | | Three Months Ended | | | Nine Months Ended |
| | | | April 2, 2017 |
|
| March 27, 2016 | | | April 2, 2017 |
|
| March 27, 2016 |
|
Net revenues:
| | | | | | | | | | | | | |
|
E-commerce (combined online and telephonic)
| | | |
$
|
177,729
| | | |
$
|
179,413
| | | |
$
|
705,407
| | | |
$
|
696,371
| |
|
Other
| | | |
|
55,986
|
| | |
|
54,794
|
| | |
|
248,690
|
| | |
|
242,258
|
|
| Total net revenues | | | | | 233,715 | | | | | 234,207 | | | | | 954,097 | | | | | 938,629 | |
|
Cost of revenues
| | | |
|
140,134
|
| | |
|
137,486
|
| | |
|
532,135
|
| | |
|
521,816
|
|
|
Gross profit
| | | | |
93,581
| | | | |
96,721
| | | | |
421,962
| | | | |
416,813
| |
|
Operating expenses:
| | | | | | | | | | | | | |
|
Marketing and sales
| | | | |
70,158
| | | | |
71,502
| | | | |
245,112
| | | | |
243,567
| |
|
Technology and development
| | | | |
10,254
| | | | |
9,903
| | | | |
29,591
| | | | |
29,059
| |
|
General and administrative
| | | | |
20,962
| | | | |
21,006
| | | | |
64,446
| | | | |
61,032
| |
|
Depreciation and amortization
| | | |
|
8,492
|
| | |
|
7,546
|
| | |
|
25,656
|
| | |
|
24,279
|
|
|
Total operating expenses
| | | |
|
109,866
|
| | |
|
109,957
|
| | |
|
364,805
|
| | |
|
357,937
|
|
|
Operating income (loss)
| | | | |
(16,285
|
)
| | | |
(13,236
|
)
| | | |
57,157
| | | | |
58,876
| |
|
Interest expense, net
| | | | |
1,191
| | | | |
1,239
| | | | |
4,796
| | | | |
5,292
| |
|
Other (income) expense, net
| | | |
|
(421
|
)
| | |
|
145
|
| | |
|
(570
|
)
| | |
|
(15,151
|
)
|
|
Income (loss) before income taxes
| | | | |
(17,055
|
)
| | | |
(14,620
|
)
| | | |
52,931
| | | | |
68,735
| |
|
Income tax expense (benefit)
| | | |
|
(5,925
|
)
| | |
|
(5,494
|
)
| | |
|
16,903
|
| | |
|
21,813
|
|
| Net income (loss) | | | |
| (11,130 | ) | | |
| (9,126 | ) | | |
| 36,028 |
| | |
| 46,922 |
|
|
Less: Net loss attributable to noncontrolling interest
| | | |
|
-
|
| | |
|
-
|
| | |
|
-
|
| | |
|
(1,007
|
)
|
| Net income (loss) attributable to 1-800-FLOWERS.COM, Inc. | | | | $ | (11,130 | ) | | | $ | (9,126 | ) | | | $ | 36,028 |
| | | $ | 47,929 |
|
| | | | | | | | | | | | |
|
|
Basic net income (loss) per common share attributable to
1-800-FLOWERS.COM, Inc.
| | | |
$
|
(0.17
|
)
| | |
$
|
(0.14
|
)
| | |
$
|
0.55
|
| | |
$
|
0.74
|
|
| | | | | | | | | | | | |
|
|
Diluted net income (loss) per common share attributable to
1-800-FLOWERS.COM, Inc.
| | | |
$
|
(0.17
|
)
| | |
$
|
(0.14
|
)
| | |
$
|
0.53
|
| | |
$
|
0.71
|
|
| | | | | | | | | | | | |
|
|
Weighted average shares used in the calculation of net income (loss)
per common share:
| | | | | | | | | | | | | |
|
Basic
| | | |
|
65,199
|
| | |
|
64,687
|
| | |
|
65,169
|
| | |
|
64,724
|
|
|
Diluted
| | | |
|
65,199
|
| | |
|
64,687
|
| | |
|
67,747
|
| | |
|
67,053
|
|
| | | | | | | | | | | | | | | | | | | | |
|
|
|
|
| |
1-800-FLOWERS.COM, Inc. and Subsidiaries Selected Financial Information Consolidated Statements of Cash Flows
(In thousands)
(unaudited)
|
| | | |
|
| | | | Nine months ended |
| | | | April 2, 2017 |
|
| March 27, 2016 |
| | | | | | |
|
| Operating activities: | | | | | | | |
|
Net income
| | | |
$
|
36,028
| | | |
$
|
46,922
| |
Reconciliation of net income to net cash provided by operating
activities, net of
acquisitions:
| | | | | | | |
|
Depreciation and amortization
| | | | |
25,656
| | | | |
24,279
| |
|
Amortization of deferred financing costs
| | | | |
1,285
| | | | |
1,209
| |
|
Deferred income taxes
| | | | |
(1,889
|
)
| | | |
(1,793
|
)
|
|
Foreign equity method investment impairment
| | | | |
-
| | | | |
1,728
| |
|
Loss on sale/impairment of iFlorist
| | | | |
-
| | | | |
2,121
| |
|
Bad debt expense
| | | | |
935
| | | | |
973
| |
|
Stock-based compensation
| | | | |
4,784
| | | | |
4,831
| |
|
Other non-cash items
| | | | |
(227
|
)
| | | |
299
| |
|
Changes in operating items:
| | | | | | | |
|
Trade receivables
| | | | |
(13,595
|
)
| | | |
(15,090
|
)
|
|
Insurance receivable
| | | | |
-
| | | | |
3,053
| |
|
Inventories
| | | | |
892
| | | | |
(2,488
|
)
|
|
Prepaid and other
| | | | |
(2,030
|
)
| | | |
156
| |
|
Accounts payable and accrued expenses
| | | | |
9,670
| | | | |
10,453
| |
|
Other assets
| | | | |
(34
|
)
| | | |
(47
|
)
|
|
Other liabilities
| | | |
|
(267
|
)
| | |
|
412
|
|
| Net cash provided by operating activities | | | | | 61,208 | | | | | 77,018 | |
| | | | | | |
|
| Investing activities: | | | | | | | |
|
Capital expenditures, net of non-cash expenditures
| | | |
|
(18,753
|
)
| | |
|
(20,022
|
)
|
| Net cash used in investing activities | | | | | (18,753 | ) | | | | (20,022 | ) |
| | | | | | |
|
| Financing activities: | | | | | | | |
|
Acquisition of treasury stock
| | | | |
(8,277
|
)
| | | |
(12,958
|
)
|
|
Proceeds from exercise of employee stock options
| | | | |
268
| | | | |
700
| |
|
Proceeds from bank borrowings
| | | | |
181,000
| | | | |
178,000
| |
|
Repayment of notes payable and bank borrowings
| | | | |
(185,000
|
)
| | | |
(188,980
|
)
|
|
Debt issuance costs
| | | | |
(1,507
|
)
| | | |
-
| |
|
Other
| | | |
| | |
|
(2
|
)
|
| Net cash used in financing activities | | | | | (13,516 | ) | | | | (23,240 | ) |
| | | |
| | |
|
| Net change in cash and cash equivalents | | | | | 28,939 | | | | | 33,756 | |
|
Cash and cash equivalents:
| | | | | | | |
|
Beginning of period
| | | |
|
27,826
|
| | |
|
27,940
|
|
| End of period | | | | $ | 56,765 |
| | | $ | 61,696 |
|
| | | | | | | | | | |
|
|
|
|
| |
1-800-FLOWERS.COM, Inc. and Subsidiaries Selected Financial Information – Category Information (in thousands) (unaudited) |
| | | |
|
| | | | Three Months Ended |
| | | | April 2, 2017 |
|
| March 27, 2016 |
|
| % Change |
|
| | | | | | | | | |
|
| Net revenues: | | | | | | | | | | |
|
1-800-Flowers.com Consumer Floral
| | | |
$
|
124,684
| | | |
$
|
113,182
| | | |
10.2
|
%
|
|
BloomNet Wire Service
| | | | |
24,091
| | | | |
22,517
| | | |
7.0
|
%
|
|
Gourmet Food & Gift Baskets
| | | | |
85,611
| | | | |
99,096
| | | |
-13.6
|
%
|
|
Corporate
| | | | |
260
| | | | |
262
| | | |
-0.8
|
%
|
|
Intercompany eliminations
| | | |
|
(931
|
)
| | |
|
(850
|
)
| | |
-9.5
|
%
|
| Total net revenues | | | |
$
|
233,715
|
| | |
$
|
234,207
|
| | |
-0.2
|
%
|
| | | | | | | | | |
|
| | | | | | | | | |
|
| Gross profit: | | | | | | | | | | |
|
1-800-Flowers.com Consumer Floral
| | | |
$
|
50,584
| | | |
$
|
45,974
| | | |
10.0
|
%
|
| | | | |
40.6
|
%
| | | |
40.6
|
%
| | | |
| | | | | | | | | |
|
|
BloomNet Wire Service
| | | | |
12,915
| | | | |
12,390
| | | |
4.2
|
%
|
| | | | |
53.6
|
%
| | | |
55.0
|
%
| | | |
| | | | | | | | | |
|
|
Gourmet Food & Gift Baskets
| | | | |
29,780
| | | | |
38,043
| | | |
-21.7
|
%
|
| | | | |
34.8
|
%
| | | |
38.4
|
%
| | | |
| | | | | | | | | |
|
|
Corporate (a)
| | | | |
302
| | | | |
314
| | | |
-3.8
|
%
|
| | | | |
116.2
|
%
| | | |
119.8
|
%
| | | |
| | | |
| | |
| | | |
| Total gross profit | | | |
$
|
93,581
|
| | |
$
|
96,721
|
| | |
-3.2
|
%
|
| | | |
|
40.0
|
%
| | |
|
41.3
|
%
| | | |
| | | | | | | | | |
|
| EBITDA, excluding stock-based compensation | | | | | | | | | | |
| | | | | | | | | |
|
| Category Contribution Margin: | | | | | | | | | | |
|
1-800-Flowers.com Consumer Floral
| | | |
$
|
15,863
| | | |
$
|
13,748
| | | |
15.4
|
%
|
|
BloomNet Wire Service
| | | | |
8,245
| | | | |
7,747
| | | |
6.4
|
%
|
|
Gourmet Food & Gift Baskets
| | | |
|
(10,776
|
)
| | |
|
(6,753
|
)
| | |
-59.6
|
%
|
|
Category Contribution Margin Subtotal
| | | | |
13,332
| | | | |
14,742
| | | |
-9.6
|
%
|
|
Corporate (a)
| | | | |
(21,125
|
)
| | | |
(20,432
|
)
| | |
-3.4
|
%
|
| | | |
| | |
| | | |
| EBITDA | | | |
$
|
(7,793
|
)
| | |
$
|
(5,690
|
)
| | |
-37.0
|
%
|
| | | | | | | | | |
|
|
Add: Stock-based compensation
| | | | |
1,286
| | | | |
1,650
| | | |
22.1
|
%
|
| | | |
| | |
| | | |
| EBITDA, excluding stock-based compensation | | | |
$
|
(6,507
|
)
| | |
$
|
(4,040
|
)
| | |
-61.1
|
%
|
| | | | | | | | | | | | | | |
|
|
|
|
| Nine Months Ended |
| | | | April 2, 2017 |
|
| March 27, 2016 |
|
| % Change |
|
| | | | | | | | | |
|
| Net revenues: | | | | | | | | | | |
|
1-800-Flowers.com Consumer Floral
| | | |
$
|
297,707
| | | |
$
|
280,956
| | | |
6.0
|
%
|
|
BloomNet Wire Service
| | | | |
65,557
| | | | |
63,740
| | | |
2.9
|
%
|
|
Gourmet Food & Gift Baskets
| | | | |
592,295
| | | | |
595,006
| | | |
-0.5
|
%
|
|
Corporate
| | | | |
839
| | | | |
817
| | | |
2.7
|
%
|
|
Intercompany eliminations
| | | |
|
(2,301
|
)
| | |
|
(1,890
|
)
| | |
-21.7
|
%
|
| Total net revenues | | | |
$
|
954,097
|
| | |
$
|
938,629
|
| | |
1.6
|
%
|
| | | | | | | | | |
|
| Gross profit: | | | | | | | | | | |
|
1-800-Flowers.com Consumer Floral
| | | |
$
|
121,383
| | | |
$
|
112,961
| | | |
7.5
|
%
|
| | | | |
40.8
|
%
| | | |
40.2
|
%
| | | |
| | | | | | | | | |
|
|
BloomNet Wire Service
| | | | |
37,019
| | | | |
35,360
| | | |
4.7
|
%
|
| | | | |
56.5
|
%
| | | |
55.5
|
%
| | | |
| | | | | | | | | |
|
|
Gourmet Food & Gift Baskets
| | | | |
262,716
| | | | |
267,650
| | | |
-1.8
|
%
|
| | | | |
44.4
|
%
| | | |
45.0
|
%
| | | |
| | | | | | | | | |
|
|
Corporate (a)
| | | | |
844
| | | | |
842
| | | |
0.2
|
%
|
| | | | |
100.6
|
%
| | | |
103.1
|
%
| | | |
| | | |
| | |
| | | |
| Total gross profit | | | |
$
|
421,962
|
| | |
$
|
416,813
|
| | |
1.2
|
%
|
| | | |
|
44.2
|
%
| | |
|
44.4
|
%
| | | |
| | | | | | | | | | | | | |
|
|
|
|
| |
| | | | Nine Months Ended |
| EBITDA, excluding stock-based compensation | | | | April 2, 2017 |
|
| Reported
March 27, 2016 |
|
| Harry & David
Integration Costs |
|
| As Adjusted
March 27, 2016 |
|
| As Adjusted
% Change |
| | | | |
| | | | | | | | | | | |
| Category Contribution Margin: | | | | | | | | | | | | | | | | |
|
1-800-Flowers.com Consumer Floral
| | | |
$
|
37,172
| | | |
$
|
33,031
| | | |
$
|
-
| | |
$
|
33,031
| | | |
12.5
|
%
|
|
BloomNet Wire Service
| | | | |
23,713
| | | | |
22,017
| | | | |
-
| | |
$
|
22,017
| | | |
7.7
|
%
|
|
Gourmet Food & Gift Baskets
| | | |
|
84,544
|
| | |
|
88,626
|
| | |
|
-
| | |
|
88,626
|
| | |
-4.6
|
%
|
|
Category Contribution Margin Subtotal
| | | | |
145,429
| | | | |
143,674
| | | | |
-
| | | |
143,674
| | | |
1.2
|
%
|
|
Corporate (a)
| | | | |
(62,616
|
)
| | | |
(60,519
|
)
| | | |
828
| | | |
(59,691
|
)
| | |
-4.9
|
%
|
| | | |
| | |
| | |
| | |
| | |
-
| |
| EBITDA | | | |
$
|
82,813
| | | |
$
|
83,155
| | | |
$
|
828
| | |
$
|
83,983
| | | |
-1.4
|
%
|
| | | | | | | | | | | | | | | |
|
|
Add: Stock-based compensation
| | | | |
4,784
| | | | |
4,831
| | | | | | |
$
|
4,831
| | | |
1.0
|
%
|
| | | |
| | |
| | |
| | |
| | | |
| EBITDA, excluding stock-based compensation | | | |
$
|
87,597
|
| | |
$
|
87,986
|
| | |
$
|
828
| | |
$
|
88,814
|
| | |
-1.4
|
%
|
| | | | | | | | | | | | | | | |
|
|
|
|
| |
|
| |
1-800-FLOWERS.COM, Inc. and Subsidiaries Selected Financial Information
(in thousands)
(unaudited)
|
Reconciliation of GAAP net income (loss) to adjusted income
(loss) attributable to 1-800-FLOWERS.COM, Inc.: |
| | | | | | |
|
| | | | Three Months Ended | | | Nine Months Ended |
| | | | April 2, 2017 |
|
| March 27, 2016 | | | April 2, 2017 |
|
| March 27, 2016 |
| | | | | | | | | | | | |
|
|
GAAP net income (loss)
| | | |
$
|
(11,130
|
)
| | |
$
|
(9,126
|
)
| | |
$
|
36,028
| | |
$
|
46,922
| |
|
Less: Net income (loss) attributable to noncontrolling interest
| | | |
|
-
|
| | |
|
-
|
| | |
|
-
| | |
|
(1,007
|
)
|
|
Income attributable to 1-800-FLOWERS.COM, Inc.
| | | | |
(11,130
|
)
| | | |
(9,126
|
)
| | | |
36,028
| | | |
47,929
| |
Adjustments to reconcile income (loss) attributable to
1-800-FLOWERS.COM, Inc. to adjusted
income (loss)
attributable to 1-800-FLOWERS.COM, Inc.
| | | | | | | | | | | | | |
|
Deduct: Gain from insurance recovery on warehouse fire
| | | | | | | |
-
| | | | | | | |
19,611
| |
|
Add back: Loss on sale/impairment of iFlorist
| | | | | | | |
-
| | | | | | | |
2,121
| |
|
Add back: Impairment of foreign equity method investment
| | | | | | | |
-
| | | | | | | |
1,728
| |
|
Add back: Harry & David integration costs
| | | | | | | |
-
| | | | | | | |
828
| |
|
Add back: income tax expense effect of adjustments
| | | |
|
| |
|
-
|
| | |
|
-
|
| |
|
5,353
|
|
| Adjusted income (loss) attributable to 1-800-FLOWERS.COM, Inc. | | | |
$
|
(11,130
|
)
|
| |
$
|
(9,126
|
)
| | |
$
|
36,028
|
| |
$
|
38,348
|
|
| | | | | | | | | | | | |
|
| GAAP income (loss) per common share attributable to
1-800-FLOWERS.COM, Inc. | | | | | | | | | | | | | |
|
Basic
| | | |
$
|
(0.17
|
)
| | |
$
|
(0.14
|
)
| | |
$
|
0.55
| | |
$
|
0.74
|
|
|
Diluted
| | | |
$
|
(0.17
|
)
| | |
$
|
(0.14
|
)
| | |
$
|
0.53
| | |
$
|
0.71
|
|
| | | | | | | | | | | | |
|
| Adjusted income (loss) per common share attributable to
1-800-FLOWERS.COM, Inc. | | | | | | | | | | | | | |
|
Basic
| | | |
$
|
(0.17
|
)
| | |
$
|
(0.14
|
)
| | |
$
|
0.55
| | |
$
|
0.59
|
|
|
Diluted
| | | |
$
|
(0.17
|
)
| | |
$
|
(0.14
|
)
| | |
$
|
0.53
| | |
$
|
0.57
|
|
| | | | | | | | | | | | |
|
Weighted average shares used in the calculation of GAAP income
(loss) and Adjusted income
(loss) per common share
attributable to 1-800-FLOWERS.COM, Inc | | | | | | | | | | | | | |
|
Basic
| | | |
|
65,199
|
| | |
|
64,687
|
| | |
|
65,169
| | |
|
64,724
|
|
|
Diluted
| | | |
|
65,199
|
| | |
|
64,687
|
| | |
|
67,747
| | |
|
67,053
|
|
| | | | | | | | | | | | | | | | | | | |
|
|
|
|
| |
| |
Reconciliation of GAAP income (loss) attributable to
1-800-Flowers.com, Inc. to adjusted EBITDA, excluding stock-based
compensation (b): |
| | | | | |
|
| | | | Three Months Ended | | Nine Months Ended |
| | | | April 2, 2017 |
|
| March 27, 2016 |
|
| April 2, 2017 |
|
| March 27, 2016 |
| | | | | | | | | | | | |
|
|
Income (loss) attributable to 1-800-FLOWERS.COM, Inc.
| | | |
$
|
(11,130
|
)
| | |
$ (9,126
|
)
| | |
$
|
36,028
| | |
$
|
47,929
|
|
Add:
| | | | | | | | | | | | | |
|
Interest expense, net
| | | | |
770
| | | |
1,384
| | | | |
4,226
| | | |
5,903
|
|
Depreciation and amortization
| | | | |
8,492
| | | |
7,546
| | | | |
25,656
| | | |
24,279
|
|
Income tax expense
| | | | | | | | | | |
16,903
| | | |
21,813
|
|
Loss on sale/impairment of iFlorist
| | | | | | |
-
| | | | | | | |
2,121
|
|
Impairment of foreign equity method investment
| | | | | | |
-
| | | | | | | |
1,728
|
|
Less:
| | | | | | | | | | | | | |
|
Net loss attributable to noncontrolling interest
| | | | | | |
-
| | | | | | | |
1,007
|
|
Income tax benefit
| | | | |
5,925
| | | |
5,494
| | | | | | | |
|
Gain from insurance recovery on warehouse fire
| | | |
| | |
-
|
| | |
| | |
|
19,611
|
|
EBITDA
| | | | |
(7,793
|
)
| | |
(5,690
|
)
| | | |
82,813
| | | |
83,155
|
|
Add: Integration costs
| | | |
| | |
-
|
| | |
| | |
|
828
|
|
Adjusted EBITDA
| | | | |
(7,793
|
)
| | |
(5,690
|
)
| | | |
82,813
| | | |
83,983
|
|
Add: Stock-based compensation
| | | |
|
1,286
|
| | |
1,650
|
| | |
|
4,784
| | |
|
4,831
|
|
Adjusted EBITDA, excluding stock-based compensation
| | | |
$
|
(6,507
|
)
| | |
$ (4,040
|
)
| | |
$
|
87,597
| | |
$
|
88,814
|
| | | | | | | | | | | | |
|
|
(a)
|
|
Corporate expenses consist of the Company’s enterprise shared
service cost centers, and include, among other items, Information
Technology, Human Resources, Accounting and Finance, Legal,
Executive and Customer Service Center functions, as well as
Stock-Based Compensation. In order to leverage the Company’s
infrastructure, these functions are operated under a centralized
management platform, providing support services throughout the
organization. The costs of these functions, other than those of the
Customer Service Center, which are allocated directly to the above
categories based upon usage, are included within corporate expenses
as they are not directly allocable to a specific segment.
|
| |
|
|
(b)
| |
Performance is measured based on segment contribution margin or
segment Adjusted EBITDA, reflecting only the direct controllable
revenue and operating expenses of the segments. As such,
management’s measure of profitability for these segments does not
include the effect of corporate overhead, described above,
depreciation and amortization, other income (net), nor does it
include one-time charges or gains. Management utilizes EBITDA, and
adjusted financial information, as a performance measurement tool
because it considers such information a meaningful supplemental
measure of its performance and believes it is frequently used by the
investment community in the evaluation of companies with comparable
market capitalization. The Company also uses EBITDA and adjusted
financial information as one of the factors used to determine the
total amount of bonuses available to be awarded to executive
officers and other employees. The Company’s credit agreement uses
EBITDA and adjusted financial information to measure compliance with
covenants such as interest coverage and debt incurrence. EBITDA and
adjusted financial information is also used by the Company to
evaluate and price potential acquisition candidates. EBITDA and
adjusted financial information have limitations as an analytical
tool, and should not be considered in isolation or as a substitute
for analysis of the Company's results as reported under GAAP. Some
of these limitations are: (a) EBITDA does not reflect changes in, or
cash requirements for, the Company's working capital needs; (b)
EBITDA does not reflect the significant interest expense, or the
cash requirements necessary to service interest or principal
payments, on the Company's debts; and (c) although depreciation and
amortization are non-cash charges, the assets being depreciated and
amortized may have to be replaced in the future, and EBITDA does not
reflect any cash requirements for such capital expenditures. Because
of these limitations, EBITDA should only be used on a supplemental
basis combined with GAAP results when evaluating the Company's
performance.
|
| |
|
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View source version on businesswire.com: http://www.businesswire.com/news/home/20170502005412/en/
1-800-FLOWERS.COM, Inc.
Investors:
Joseph
D. Pititto, 516-237-6131
[email protected]
or
Media:
Yanique
Woodall, 516-237-6028
[email protected]
Source: 1-800-FLOWERS.COM, Inc.