Build-A-Bear Workshop Inc 8-K, filed Mar 10, 2021

Build-A-Bear Workshop Inc (BBW)

8-K 2021-03-10 For: 2021-03-10

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Added on April 09, 2026

About this 8-K

Build-A-Bear Workshop Inc filed this 8-K on March 10, 2021.

Items reported

Item 2.02: Financial results
Item 9.01: Financial statements and exhibits

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Delaware	001-32320	43-1883836
(State or Other Jurisdiction	(Commission	(IRS Employer
of Incorporation)	File Number)	Identification No.)

415 South 18th St., St. Louis, Missouri	63103
(Address of Principal Executive Offices)	(Zip Code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	BBW	New York Stock Exchange

Exhibit Number	Description of Exhibit
99.1	Press Release dated March 10, 2021
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

	BUILD-A-BEAR WORKSHOP, INC.



Date: March 10, 2021	By:	/s/ Voin Todorovic
	Name:	Voin Todorovic
	Title:	Chief Financial Officer

Build-A-Bear Workshop Inc 8-K, filed Mar 10, 2021

About this 8-K

Items reported

Build-A-Bear Workshop, Inc. Exceeds Guidance With Pre-tax Income of $9.2 Million in Fiscal 2020 Fourth Quarter

Contacts

BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Statements of Operations (dollars in thousands, except share and per share data)

	13 Weeks Ended January 30, 2021		% of Total Revenues ⁽¹⁾	13 Weeks Ended February 1, 2020			% of Total Revenues ⁽¹⁾
Revenues:
Net retail sales	$	91,856	98.1	$	100,654		96.3
Commercial revenue		1,370	1.5		3,385		3.2
International franchising		434	0.4		544		0.5
Total revenues		93,660	100.0		104,583		100.0
Cost of merchandise sold:
Cost of merchandise sold - retail ⁽¹⁾		45,606	49.6		49,930		49.6
Store asset impairment		302	0.3		—		0.0
Cost of merchandise sold - commercial ⁽¹⁾		528	38.5		1,545		45.6
Cost of merchandise sold - international franchising ⁽¹⁾		299	68.9		419		77.0
Total cost of merchandise sold		46,735	49.9		51,894		49.6
Consolidated gross profit		46,925	50.1		52,689		50.4

Selling, general and administrative expense		37,757	40.3		45,107		43.1
Interest (income) expense, net		4	0.0		(6	)	(0.0	)
(Loss) income before income taxes		9,164	9.8		7,588		7.3
Income tax expense		321	0.3		1,426		1.4
Net (loss) income	$	8,843	9.4	$	6,162		5.9

(Loss) Income per common share:
Basic	$	0.59		$	0.42
Diluted	$	0.57		$	0.42
Shares used in computing common per share amounts:
Basic		14,999,786			14,752,560
Diluted		15,524,340			14,808,984

BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Statements of Operations (dollars in thousands, except share and per share data)

	52 Weeks Ended January 30, 2021			% of Total Revenues ⁽¹⁾		52 Weeks Ended February 1, 2020		% of Total Revenues ⁽¹⁾
Revenues:
Net retail sales	$	249,210		97.6		$	323,491	95.6
Commercial revenue		4,426		1.7			11,892	3.5
International franchising		1,674		0.7			3,160	0.9
Total revenues		255,310		100.0			338,543	100.0
Costs and expenses:
Cost of merchandise sold - retail ⁽¹⁾		147,906		59.3			176,652	54.6
Store asset impairment ⁽²⁾		7,346		2.9			—	—
Cost of merchandise sold - commercial⁽¹⁾		1,837		41.5			5,432	45.7
Cost of merchandise sold - international franchising⁽¹⁾		935		55.9			2,836	89.7
Total cost of merchandise sold		158,024		61.9			184,920	54.6
Consolidated gross profit		97,286		38.1			153,623	45.4

Selling, general and administrative expense		119,089		46.6			152,047	44.9
Interest expense, net		10		0.0			15	0.0
Income (loss) before income taxes		(21,813	)	(8.5	)		1,561	0.5
Income tax expense (benefit)		2,797		1.1			1,300	0.4
Net income (loss)	$	(24,610	)	(9.6	)	$	261	0.1

Income (loss) per common share:
Basic	$	(1.65	)			$	0.02
Diluted	$	(1.65	)			$	0.02
Shares used in computing common per share amounts:
Basic		14,923,304					14,711,334
Diluted		14,923,304					14,759,810

	(1)			Selected statement of operations data expressed as a percentage of total revenues, except cost of merchandise sold - retail, cost of merchandise sold - commercial and cost of merchandise sold - international franchising that are expressed as a percentage of net retail sales, commercial revenue and international franchising, respectively. Percentages will not total due to cost of merchandise sold being expressed as a percentage of net retail sales, commercial revenue or international franchising and immaterial rounding.
	(2)			Due to the charges primarily in the 52 weeks ended January 30, 2021, a separate line item was disclosed and expressed as a percentage of net retail sales.

BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES Unaudited Condensed Consolidated Balance Sheets (dollars in thousands, except per share data)

	January 30, 2021			February 1, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	34,840		$	26,726
Inventories, net		46,947			53,381
Receivables, net		8,295			11,526
Prepaid expenses and other current assets		10,111			7,117
Total current assets		100,193			98,750

Operating lease right-of-use asset		104,825			126,144
Property and equipment, net		52,973			65,855
Deferred tax assets		-			3,411
Other assets, net		3,381			3,102
Total Assets	$	261,372		$	297,262

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	17,784		$	15,680
Accrued expenses		20,326			16,536
Operating lease liability short term		32,402			30,912
Gift cards and customer deposits		19,029			20,231
Deferred revenue and other		2,445			2,605
Total current liabilities		91,986			85,964

Operating lease liability long term		101,462			119,625
Deferred franchise revenue		920			1,325
Other liabilities		1,323			1,717

Stockholders' equity:
Common stock, par value $0.01 per share		159			152
Additional paid-in capital		72,822			70,633
Accumulated other comprehensive loss		(12,615	)		(12,079	)
Retained earnings		5,315			29,925
Total stockholders' equity		65,681			88,631
Total Liabilities and Stockholders' Equity	$	261,372		$	297,262

(1)		Retail gross margin represents net retail sales less cost of merchandise sold - retail. Retail gross margin percentage represents retail gross margin divided by net retail sales. Store impairment is excluded from retail gross margin.
(2)		Capital expenditures represents cash paid for property, equipment, other assets and other intangible assets.
(3)		Excludes e-commerce. North American stores are located in the United States, Canada and Puerto Rico. In Europe, stores are located in the United Kingdom, Ireland and Denmark. In Asia, the store is located in China. Seasonal locations not included in store count.
(4)		Square footage for stores located in North America is leased square footage. Square footage for stores located in Europe is estimated selling square footage. Seasonal locations not included in the store count.

* Non-GAAP Financial Measures

BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES Reconciliation of GAAP to Non-GAAP Results (dollars in thousands, except per share data)


	13 Weeks Ended January 30, 2021			13 Weeks Ended February 1, 2020			52 Weeks Ended January 30, 2021			52 Weeks Ended February 1, 2020
Income (loss) before income taxes (pre-tax)	$	9,164		$	7,588		$	(21,813	)	$	1,561
Income (loss) before income tax adjustments:
United Kingdom Lockdown Business Grants ⁽¹⁾		(756	)		-			(756	)		-
COVID-19 activity ⁽²⁾		30			-			142			-
Ohio Bureau of Workers' Compensation dividend ⁽³⁾		(332	)		-			(332	)		-
Impairment, bad debt, and lease modification ⁽⁴⁾⁽⁵⁾		328			(244	)		7,956			(1,016	)
Foreign exchange (gains) losses ⁽⁶⁾		(798	)		(261	)		(601	)		71
Other ⁽⁷⁾		2			202			336			370
Adjusted income (loss) before income taxes (adjusted pre-tax)		7,638			7,285			(15,068	)		986

Income tax (expense) benefit		(321	)		(1,426	)		(2,797	)		(1,300	)
Tax adjustments:
Income tax impact: adjustments ⁽⁸⁾⁽⁹⁾		-			64			-			121
Income tax impact: CARES Act ⁽¹⁰⁾		-			-			(773	)		-
Valuation allowance ⁽¹¹⁾		-			-			3,272			449
Adjusted income tax (expense) benefit		(321	)		(1,362	)		(298	)		(730	)

Net (loss) income		8,843			6,162			(24,610	)		261
Adjustments		(1,526	)		(239	)		9,244			(5	)
Adjusted net (loss) income	$	7,317		$	5,923		$	(15,366	)	$	256

Net (loss) income per diluted share (EPS)	$	0.57		$	0.42		$	(1.65	)	$	0.02

Adjusted net (loss) income per diluted share (adjusted EPS)	$	0.47		$	0.40		$	(1.03	)	$	0.02

Fiscal 2023 forecast reconciliation of Non-GAAP figure (dollars in millions)

Income before income taxes (pre-tax)		$7 - $17
Interest		-
Depreciation and Amortization		13
Earnings before interest, taxes, depreciation and amortization (EBITDA)		$20 - $30

	(1)		Represents the business grants received from the United Kingdom government for business in the retail, hospitality and leisure sectors. These grants were provided on a per-property basis to support businesses through the latest lockdown restrictions as a result of the COVID-19 pandemic.
	(2)		Represents COVID-19 related expenses at our stores, warehouse, and headquarters.
	(3)		Represent a dividend distribution received from the Ohio Bureau of Workers' Compensation in the fourth quarter.
	(4)		Represents non-cash adjustments including asset impairment charges related to store fixed assets and right-of-use operating lease assets and bad debt expense in the 13 and 52 weeks ending January 30, 2021 and February 1, 2020.
	(5)		Represents the lease modification impacts of exercising early termination options in leases offset by non-cash impairment charges related to store fixed assets, receivables, and inventory in the 13 and 52 weeks ended February 1, 2020
	(6)		Represents the consolidated impact of foreign exchange rates on the re-measurement of balance sheet items not denominated in functional currency recorded under the provisions of U.S. GAAP. This does not include any impact on margin associated with the translation of revenues or the foreign subsidiaries' purchase of inventory in U.S. dollars.
	(7)		Represents severance and other non-recurring changes in reserves and charges.
	(8)		As a result of the Company's full, global valuation allowance, the Company cannot realize an income tax benefit on these adjustments for the fourth quarter or full year fiscal 2020.
	(9)		Represents the aggregate tax impact of the pre-tax adjustments for the fourth quarter and full year fiscal 2019.
	(10)		Represents the impact of the technical correction related to qualified leasehold improvements resulting from the CARES Act occurring in the first quarter of fiscal 2020
	(11)		Represents the valuation allowance recorded on its net deferred tax assets in North America in the first quarter of fiscal 2020 and the United Kingdom in the fourth quarter of fiscal 2019.