8-K
1 800 Flowers Com Inc (FLWS)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
April 30, 2020
1-800-FLOWERS.COM, INC.
(Exact Name of Registrant as Specified in Charter)
| Delaware | 0-26841 | 11-3117311 |
|---|---|---|
| (State or Other Jurisdiction<br><br> <br>of Incorporation) | (Commission<br><br> <br>File Number) | (I.R.S. Employer<br><br> <br>Identification No.) |
One Old Country Road, Suite 500, Carle Place, New York 11514
(Address of Principal Executive Offices, and Zip Code)
(516) 237-6000
Registrant’s Telephone Number, Including Area Code
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communication pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communication pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Class A Common Stock | FLWS | The Nasdaq Stock Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition |
|---|
On April 30, 2020, 1-800-FLOWERS.COM, Inc. issued a press release announcing its financial results for its Fiscal 2020 Third Quarter ended March 29, 2020. A copy of the press release is included as Exhibit 99 and is incorporated herein by reference.
| Item 9.01 | Financial Statements and Exhibits. |
|---|
(c) Exhibits
The following exhibits are furnished with this Form 8-K:
99.1 Press Release dated April 30, 2020.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| 1-800-FLOWERS.COM, Inc. | |
|---|---|
| By: | /s/ William E. Shea |
| William E. Shea | |
| Chief Financial Officer, Senior Vice-President | |
| Finance and Administration | |
| Date: April 30, 2020 |
Exhibit 99.1
1-800-FLOWERS.COM, Inc. Reports Strong Revenue Growth for its Fiscal 2020 Third Quarter; Reaffirms Guidance for Strong Top and Bottom-Line Growth for the Full Fiscal 2020 Year
- Total net revenues increased 12.2 percent to $278.8 million compared with $248.4 million in the prior year period. - Net loss was $9.7 million, or a loss of $0.15 per share. Excluding transaction costs, adjusted net loss^1^ was $9.0 million, or a loss of $0.14 per share, compared with a net loss of $8.2 million, or a loss of $0.13 per share in the prior year period. - Adjusted EBITDA^1^ was a loss of $2.4 million, compared with a loss of $4.4 million in the prior year period.
(^1^ Refer to “Definitions of Non-GAAP Financial Measures” and the tables attached at the end of this press release for reconciliation of Non-GAAP (“Adjusted”) results to applicable GAAP results.)
CARLE PLACE, N.Y.--(BUSINESS WIRE)--April 30, 2020--1-800-FLOWERS.COM, Inc. (NASDAQ: FLWS), a leading provider of gifts designed to help customers express, connect and celebrate, today reported results for its Fiscal 2020 third quarter ended March 29, 2020.
Chris McCann, CEO of 1-800-FLOWERS.COM, Inc., said, “Our solid results for the fiscal third quarter reflect the continuation of the momentum we saw throughout the first half of our fiscal year. Strong consolidated revenue growth of 12.2 percent was driven by increases across all three of our business segments. In our Gourmet Foods and Gift Baskets segment, revenues increased 27.1 percent, reflecting continuing positive trends in everyday gifting occasions and increased self-consumption as well as contributions from Shari’s Berries, which we acquired in August 2019.
“In our Consumer Floral segment, the 1-800-Flowers.com brand further extended its market leading position with revenue growth of 5.4 percent, driven by double-digit revenue growth during the Valentine’s Day holiday period. Our BloomNet business also continued to increase its market share position with revenues growing 7.9 percent in the quarter. In both Consumer Floral and BloomNet, top and bottom-line results for the quarter would have been even stronger were it not for softer consumer demand in the last few weeks of March related to the impact of the Covid-19 crisis. We saw this pattern reverse as we entered our current fiscal fourth quarter and demand has increased significantly as consumers are increasingly turning to the 1-800-Flowers brand to help them express themselves and stay connected.”
McCann added, “As we navigate these trying and uncertain times, the health and safety of our associates, our BloomNet florists, our vendors and our customers is paramount to us. In accordance with CDC and other health agency guidelines we continue to make the necessary changes across our operations, including manufacturing, warehouse and distribution, to ensure the safety and wellbeing of our associates while maintaining our business continuity. As always, our mission is to engage with our customers to help them express and connect – sentiments that are increasingly important during this difficult time.”
Fiscal 2020 Third Quarter Results:
For the third quarter of 2020, total net revenues increased 12.2 percent to $278.8 million compared with $248.4 million in the prior year period. The strong performance was driven by net revenue growth in all three business segments, with Gourmet Foods and Gift Baskets up 27.1 percent, Consumer Floral up 5.4 percent, and BloomNet up 7.9 percent compared to the prior year period.
Gross profit margin for the quarter was 38.5 percent, a decrease of 80 basis points compared with gross profit margin of 39.3 percent in the prior year period. Operating expenses as a percent of total revenues were 42.4 percent, an improvement of 270 basis points compared with 45.1 percent in the prior year period. Excluding the impacts of the Company’s non-qualified deferred 401k compensation plan and costs associated with its planned acquisition of PersonalizationMall.com, operating expenses, as a percentage of total revenues, were 43.1% compared with 44.6% in the prior year.
Strong top-line growth and improved operating efficiency resulted in an Adjusted EBITDA^1^ loss of $2.4 million compared with an Adjusted EBITDA^1^ loss of $4.4 million in the prior year period. Net loss for the quarter was $9.7 million, or loss of $0.15 per share. Excluding certain transaction costs, net loss for the quarter was $9.0 million, or a loss of $0.14 per share, compared with a net loss of $8.2 million, or loss of $0.13 per share, in the prior year period.
SEGMENT RESULTS:
The Company provides fiscal 2020 third quarter selected financial results for its Gourmet Foods and Gift Baskets, Consumer Floral and BloomNet segments in the tables attached to this release and as follows:
Gourmet Foods and Gift Baskets: Revenues for the quarter were $95.9 million, an increase of 27.1 percent compared with revenues of $75.4 million in the prior year period reflecting continued growth in everyday gifting occasions and self-consumption as well as contributions from the Shari’s Berries brand, which the Company acquired in August 2019. Gross profit margin was 34.4 percent, compared with 35.6 percent in the prior year period. As a result of these factors, segment contribution margin^1^ loss improved 12.9 percent to a loss of $6.3 million, compared with a segment contribution margin loss of $7.2 million in the prior year period.
Consumer Floral: Revenues increased 5.4 percent to $152.6 million, compared with $144.8 million in the prior year period. This primarily reflects double-digit growth for the Valentine’s Day holiday period partially offset by softer demand in the last few weeks of the quarter resulting from the impact of the Covid-19 crisis. Gross margin was 39.3 percent, compared with 38.9 percent in the prior year period. Segment contribution margin^1^ was $15.4 million, unchanged compared with the prior year period.
BloomNet Wire Service: Revenues for the quarter increased 7.9 percent to $30.4 million, compared with $28.2 million in the prior year period. Gross profit margin was 47.3 percent, compared with 49.9 percent in the prior year period. Segment contribution margin^1^ increased 5.7 percent to $10 million, compared with $9.5 million in the prior year period.
COMPANY GUIDANCE
Based on the continued strong growth momentum that the Company has experienced through the first three quarters of its fiscal year, combined with the positive trends it has seen through the first four weeks of the current fiscal fourth quarter, the Company is reaffirming its growth guidance for fiscal 2020 as follows:
- Total consolidated revenue growth of 8-9 percent compared with the prior year, including approximately 6-to-7 percent organic revenue growth combined with contributions from the Shari’s Berries brand, which the Company acquired in August 2019;
- EPS growth in a range of 15-to-17 percent, compared with the prior year;
- Adjusted EBITDA^1^ growth in a range of 13-to-15 percent, compared with the prior year, and;
- Free Cash Flow for the year in a range of $45-to-$50 million.
Note: The Company’s guidance for Fiscal Year 2020 EPS and Adjusted EBITDA^1^ excludes certain one-time costs, expected to be recognized in the fourth quarter, associated with the closing of its Harry & David retail stores and costs associated with its planned acquisition of PersonalizationMall.com.
RESPONSE TO COVID-19
In response to the global pandemic, 1-800-FLOWERS.COM, Inc. has taken necessary actions to ensure employee safety and business continuity, informed by the guidelines set forth by local, state and federal government and health officials. These initiatives include developing a “Pandemic Preparedness and Response Plan,” establishing an internal “nerve center” to allow for unobstructed communication and coordination throughout the business, designing workstream teams to promote workforce protection and supply chain management, and dedicating resources to support customers, franchisees, and florists.
Definitions of non-GAAP Financial Measures:
We sometimes use financial measures derived from consolidated financial information, but not presented in our financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain of these are considered "non-GAAP financial measures" under the U.S. Securities and Exchange Commission rules. Non-GAAP financial measures referred to in this document are either labeled as “non-GAAP” or designated as such with a “1”. See below for definitions and the reasons why we use these non-GAAP financial measures. Where applicable, see the Selected Financial Information below for reconciliations of these non-GAAP measures to their most directly comparable GAAP financial measures.
EBITDA and Adjusted EBITDA
We define EBITDA as net income (loss) before interest, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA adjusted for the impact of stock-based compensation, Non-Qualified Plan Investment appreciation/depreciation, and for certain items affecting period-to-period comparability. See Selected Financial Information for details on how EBITDA and Adjusted EBITDA were calculated for each period presented. The Company presents EBITDA and Adjusted EBITDA 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 uses EBITDA and Adjusted EBITDA as factors 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 determine its interest rate and to measure compliance with certain covenants. EBITDA and Adjusted EBITDA are also used by the Company to evaluate and price potential acquisition candidates. EBITDA and Adjusted EBITDA 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 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 Adjusted EBITDA should only be used on a supplemental basis combined with GAAP results when evaluating the Company's performance.
Segment Contribution Margin
We define Segment Contribution Margin as earnings before interest, taxes, depreciation and amortization, before the allocation of corporate overhead expenses. See Selected Financial Information for details on how Segment Contribution Margin was calculated for each period presented. When viewed together with our GAAP results, we believe Segment Contribution Margin provides management and users of the financial statements meaningful information about the performance of our business segments. Segment Contribution Margin is used in addition to and in conjunction with results presented in accordance with GAAP and should not be relied upon to the exclusion of GAAP financial measures. The material limitation associated with the use of the Segment Contribution Margin is that it is an incomplete measure of profitability as it does not include all operating expenses or non-operating income and expenses. Management compensates for these limitations when using this measure by looking at other GAAP measures, such as Operating Income and Net Income.
Adjusted Net Income (Loss) and Adjusted or Comparable Net Income (Loss) Per Common Share:
We define Adjusted Net Income (Loss) and Adjusted or Comparable Net Income (Loss) Per Common Share as Net Income (Loss) and Net Income (Loss) Per Common Share adjusted for certain items affecting period to period comparability. See Selected Financial Information below for details on how Adjusted Net Income (Loss) and Adjusted or Comparable Net Income (Loss) Per Common Share were calculated for each period presented. We believe that Adjusted Net Income (Loss) and Adjusted or Comparable EPS are meaningful measures because they increase the comparability of period to period results. Since these are not measures of performance calculated in accordance with GAAP, they should not be considered in isolation of, or as a substitute for, GAAP Net Income (Loss) and Net Income (Loss) Per Common share, as indicators of operating performance and they may not be comparable to similarly titled measures employed by other companies.
Free Cash Flow
We define Free Cash Flow as net cash provided by operating activities less capital expenditures. The Company considers Free Cash Flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after the purchases of fixed assets, which can then be used to, among other things, invest in the Company’s business, make strategic acquisitions, strengthen the balance sheet and repurchase stock or retire debt. Free Cash Flow is a liquidity measure that is frequently used by the investment community in the evaluation of similarly situated companies. Since Free Cash Flow is not a measure of performance calculated in accordance with GAAP, it should not be considered in isolation or as a substitute for analysis of the Company's results as reported under GAAP. A limitation of the utility of Free Cash Flow as a measure of financial performance is that it does not represent the total increase or decrease in the Company's cash balance for the period.
About 1-800-FLOWERS.COM, Inc.
1-800-FLOWERS.COM, Inc. is a leading provider of gifts designed to help customers express, connect and celebrate. The Company’s Celebrations Ecosystem features our all-star family of brands, including: 1-800-Flowers.com®, 1-800-Baskets.com®, Cheryl’s Cookies®, Harry & David®, Shari’s Berries®, FruitBouquets.com®, Moose Munch®, The Popcorn Factory®, Wolferman’s Bakery℠, Personalization Universe®, Simply Chocolate®, and Goodsey®. We also offer top-quality steaks and chops from Stock Yards®. Through the Celebrations Passport® loyalty program, which provides members with free standard shipping and no service charge across our portfolio of brands, 1-800-FLOWERS.COM, Inc. strives to deepen relationships with customers. The Company also operates BloomNet®, an international floral wire service providing a broad-range of products and services designed to help professional florists grow their businesses profitably; Napco℠, a resource for floral gifts and seasonal décor; and DesignPac Gifts, LLC, a manufacturer of gift baskets and towers. **** 1-800-FLOWERS.COM, Inc. was recognized as the 2019 Mid-Market Company of the Year by CEO Connection. Shares in 1-800-FLOWERS.COM, Inc. are traded on the NASDAQ Global Select Market, ticker symbol: FLWS. For more information, visit 1800flowersinc.com or follow @1800FLOWERSInc on Twitter.
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 using statements that include words such as “estimate,” “expects,” “project,” “believe,” “anticipate,” “intend,” “plan,” “foresee,” “forecast,” “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 not limited to, statements regarding the Company’s ability to achieve its guidance for fiscal-year 2020; the impact of the Covid-19 pandemic on the Company; its ability to leverage its operating platform and reduce operating expense ratio; its ability to successfully integrate acquired businesses and assets; 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. Reconciliations for forward looking figures would require unreasonable efforts at this time because of the uncertainty and variability of the nature and amount of certain components of various necessary GAAP components, including for example those related to compensation, tax items, amortization or others that may arise during the year, and the Company’s management believes such reconciliations would imply a degree of precision that would be confusing or misleading to investors. The lack of such reconciling information should be considered when assessing the impact of such disclosures. The Company undertakes no obligation to publicly update any of the forward-looking statements, whether because of new information, future events or otherwise, made in this release or in any of its SEC filings. Consequently, you should not consider any such list to be a complete set of all potential risks and uncertainties. For a more detailed description of these and other risk factors, 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.
Conference Call:
The Company will conduct a conference call to discuss the above details and attached financial results today, Thursday, April 30, 2020 at 8:00 a.m. (ET). The conference call will be available via live webcast from the Investor Relations section of the Company’s website at www.1800flowersinc.com. A recording of the call will be posted on the Investor Relations section of the Company’s website within two hours of the call’s completion. A replay of the call can be accessed beginning at 2:00 p.m. (ET) on the day of the call through May 7, 2020, at: (US) 1-877-344-7529; (International) 1-412-317-0088; enter conference ID #: 10142660.
Note: The following 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<br><br> <br>Condensed Consolidated Balance Sheets<br><br> <br>(In thousands) | ||||
|---|---|---|---|---|
| March 29, 2020 | June 30, 2019 | |||
| (unaudited) | ||||
| Assets | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 232,115 | $ | 172,923 |
| Trade receivables, net | 26,217 | 12,374 | ||
| Inventories | 74,037 | 92,361 | ||
| Prepaid and other | 21,312 | 25,580 | ||
| Total current assets | 353,681 | 303,238 | ||
| Property, plant and equipment, net | 166,399 | 166,681 | ||
| Operating lease right-of-use assets | 70,284 | - | ||
| Goodwill | 74,711 | 62,590 | ||
| Other intangibles, net | 66,500 | 59,615 | ||
| Other assets | 17,054 | 14,316 | ||
| Total assets | $ | 748,629 | $ | 606,440 |
| Liabilities and Stockholders' Equity | ||||
| Current liabilities: | ||||
| Accounts payable | $ | 37,314 | $ | 25,704 |
| Accrued expenses | 116,815 | 96,793 | ||
| Current maturities of long-term debt | 5,000 | 5,000 | ||
| Current portion of long-term operating lease liabilities | 9,524 | - | ||
| Total current liabilities | 168,653 | 127,497 | ||
| Long-term debt | 88,648 | 91,973 | ||
| Long-term operating lease liabilities | 64,251 | - | ||
| Deferred tax liabilities | 27,300 | 28,898 | ||
| Other liabilities | 11,766 | 15,361 | ||
| Total liabilities | 360,618 | 263,729 | ||
| Total stockholders’ equity | 388,011 | 342,711 | ||
| Total liabilities and stockholders’ equity | $ | 748,629 | $ | 606,440 |
| 1-800-FLOWERS.COM, Inc. and Subsidiaries<br><br> <br>Selected Financial Information<br><br> <br>Condensed Consolidated Statements of Income (Loss)<br><br> <br>(In thousands, except for per share data)<br><br> <br>(unaudited) | ||||||||
|---|---|---|---|---|---|---|---|---|
| Three Months Ended | Nine Months Ended | |||||||
| March 29,<br><br> <br>2020 | March 31,<br><br> <br>2019 | March 29,<br><br> <br>2020 | March 31,<br><br> <br>2019 | |||||
| Net revenues: | ||||||||
| E-Commerce | $ | 231,851 | $ | 204,362 | $ | 847,985 | $ | 780,883 |
| Other | 46,925 | 44,051 | 223,696 | 208,342 | ||||
| Total net revenues | 278,776 | 248,413 | 1,071,681 | 989,225 | ||||
| Cost of revenues | 171,324 | 150,893 | 618,911 | 568,338 | ||||
| Gross profit | 107,452 | 97,520 | 452,770 | 420,887 | ||||
| Operating expenses: | ||||||||
| Marketing and sales | 78,606 | 71,163 | 262,849 | 243,781 | ||||
| Technology and development | 11,900 | 11,511 | 34,436 | 32,696 | ||||
| General and administrative | 20,031 | 22,447 | 64,187 | 64,480 | ||||
| Depreciation and amortization | 7,803 | 7,028 | 23,268 | 22,840 | ||||
| Total operating expenses | 118,340 | 112,149 | 384,740 | 363,797 | ||||
| Operating income (loss) | (10,888) | (14,629) | 68,030 | 57,090 | ||||
| Interest (income) expense, net | 147 | (30) | 1,727 | 2,390 | ||||
| Other (income) expense, net | 2,605 | (1,285) | 1,714 | (293) | ||||
| Income (loss) before income taxes | (13,640) | (13,314) | 64,589 | 54,993 | ||||
| Income tax expense (benefit) | (3,983) | (5,073) | 15,365 | 11,922 | ||||
| Net income (loss) | $ | (9,657) | $ | (8,241) | $ | 49,224 | $ | 43,071 |
| Basic net income (loss) per common share | $ | (0.15) | $ | (0.13) | $ | 0.76 | $ | 0.67 |
| Diluted net income (loss) per common share | $ | (0.15) | $ | (0.13) | $ | 0.74 | $ | 0.65 |
| Weighted average shares used in the calculation of net income (loss) per common share: | ||||||||
| Basic | 64,348 | 64,194 | 64,517 | 64,383 | ||||
| Diluted | 64,348 | 64,194 | 66,378 | 66,456 |
| 1-800-FLOWERS.COM, Inc. and Subsidiaries<br><br> <br>Selected Financial Information<br><br> <br>Consolidated Statements of Cash Flows<br><br> <br>(In thousands)<br><br> <br>(unaudited) | ||||||
|---|---|---|---|---|---|---|
| Nine months ended | ||||||
| March 29, 2020 | March 31, 2019 | |||||
| Operating activities: | ||||||
| Net income | $ | 49,224 | $ | 43,071 | ||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||
| Depreciation and amortization | 23,268 | 22,840 | ||||
| Amortization of deferred financing costs | 486 | 671 | ||||
| Deferred income taxes | (1,597 | ) | 811 | |||
| Bad debt expense | 1,201 | 1,018 | ||||
| Stock-based compensation | 6,441 | 4,531 | ||||
| Other non-cash items | (23 | ) | (301 | ) | ||
| Changes in operating items: | ||||||
| Trade receivables | (15,044 | ) | (7,249 | ) | ||
| Inventories | 19,353 | 14,448 | ||||
| Prepaid and other | 3,148 | 2,675 | ||||
| Accounts payable and accrued expenses | 31,442 | 14,741 | ||||
| Other assets and liabilities | (557 | ) | (251 | ) | ||
| Net cash provided by operating activities | 117,342 | 97,005 | ||||
| Investing activities: | ||||||
| Acquisitions, net of cash acquired | (20,500 | ) | - | |||
| Capital expenditures, net of non-cash expenditures | (22,282 | ) | (16,845 | ) | ||
| Purchase of equity investments | (1,176 | ) | - | |||
| Net cash used in investing activities | (43,958 | ) | (16,845 | ) | ||
| Financing activities: | ||||||
| Acquisition of treasury stock | (10,667 | ) | (14,765 | ) | ||
| Proceeds from exercise of employee stock options | 285 | 929 | ||||
| Proceeds from bank borrowings | 20,000 | 30,000 | ||||
| Repayment of notes payable and bank borrowings | (23,750 | ) | (37,187 | ) | ||
| Debt issuance cost | (60 | ) | - | |||
| Net cash used in financing activities | (14,192 | ) | (21,023 | ) | ||
| Net change in cash and cash equivalents | 59,192 | 59,137 | ||||
| Cash and cash equivalents: | ||||||
| Beginning of period | 172,923 | 147,240 | ||||
| End of period | $ | 232,115 | $ | 206,377 |
| 1-800-FLOWERS.COM, Inc. and Subsidiaries<br><br> <br>Selected Financial Information – Category Information<br><br> <br>(in thousands) (unaudited) | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Three Months Ended | |||||||||||||
| March 29,<br><br> <br>2020 | Transaction<br><br> <br>Costs | As Adjusted<br><br> <br>(non-GAAP)<br><br> <br>March 29, 2020 | March 31,<br><br> <br>2019 | %<br><br> <br>Change | |||||||||
| Net revenues: | |||||||||||||
| 1-800-Flowers.com Consumer Floral | $ | 152,620 | $ | 152,620 | $ | 144,821 | 5.4 | % | |||||
| BloomNet Wire Service | 30,414 | 30,414 | 28,185 | 7.9 | % | ||||||||
| Gourmet Food & Gift Baskets | 95,906 | 95,906 | 75,445 | 27.1 | % | ||||||||
| Corporate | 112 | 112 | 263 | -57.4 | % | ||||||||
| Intercompany eliminations | (276 | ) | (276 | ) | (301 | ) | 8.3 | % | |||||
| Total net revenues | $ | 278,776 | $ | - | $ | 278,776 | $ | 248,413 | 12.2 | % | |||
| Gross profit: | |||||||||||||
| 1-800-Flowers.com Consumer Floral | $ | 59,943 | $ | 59,943 | $ | 56,334 | 6.4 | % | |||||
| 39.3 | % | 39.3 | % | 38.9 | % | ||||||||
| BloomNet Wire Service | 14,401 | 14,401 | 14,071 | 2.3 | % | ||||||||
| 47.3 | % | 47.3 | % | 49.9 | % | ||||||||
| Gourmet Food & Gift Baskets | 32,956 | 32,956 | 26,848 | 22.8 | % | ||||||||
| 34.4 | % | 34.4 | % | 35.6 | % | ||||||||
| Corporate | 152 | 152 | 267 | -43.1 | % | ||||||||
| 135.7 | % | 135.5 | % | 101.5 | % | ||||||||
| Total gross profit | $ | 107,452 | $ | - | $ | 107,452 | $ | 97,520 | 10.2 | % | |||
| 38.5 | % | - | 38.5 | % | 39.3 | % | |||||||
| EBITDA (non-GAAP): | |||||||||||||
| Segment Contribution Margin (non-GAAP) (a): | |||||||||||||
| 1-800-Flowers.com Consumer Floral | $ | 15,439 | $ | - | $ | 15,439 | $ | 15,364 | 0.5 | % | |||
| BloomNet Wire Service | 10,025 | - | 10,025 | 9,480 | 5.7 | % | |||||||
| Gourmet Food & Gift Baskets | (6,275 | ) | - | (6,275 | ) | (7,202 | ) | 12.9 | % | ||||
| Segment Contribution Margin Subtotal | 19,189 | - | 19,189 | 17,642 | 8.8 | % | |||||||
| Corporate (b) | (22,274 | ) | 911 | (21,363 | ) | (25,243 | ) | 15.4 | % | ||||
| EBITDA (non-GAAP) | (3,085 | ) | 911 | (2,174 | ) | (7,601 | ) | 71.4 | % | ||||
| Add: Stock-based compensation | 2,396 | 2,396 | 1,903 | 25.9 | % | ||||||||
| Add: Comp charge related to NQ Plan<br><br> <br>Investment Appreciation/(Depreciation) | (2,611 | ) | (2,611 | ) | 1,294 | -301.8 | % | ||||||
| Adjusted EBITDA (non-GAAP) | $ | (3,300 | ) | $ | 911 | $ | (2,389 | ) | $ | (4,404 | ) | -45.8 | % |
| 1-800-FLOWERS.COM, Inc. and Subsidiaries<br><br> <br>Selected Financial Information – Category Information<br><br> <br>(in thousands) (unaudited) | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Nine Months Ended | |||||||||||||
| March 29,<br><br> <br>2020 | Transaction<br><br> <br>Costs | As Adjusted<br><br> <br>(non-GAAP)<br><br> <br>March 29, 2020 | March 31,<br><br> <br>2019 | %<br><br> <br>Change | |||||||||
| Net revenues: | |||||||||||||
| 1-800-Flowers.com Consumer Floral | $ | 359,104 | $ | - | $ | 359,104 | $ | 338,003 | 6.2 | % | |||
| BloomNet Wire Service | 81,576 | 81,576 | 75,613 | 7.9 | % | ||||||||
| Gourmet Food & Gift Baskets | 631,705 | 631,705 | 575,966 | 9.7 | % | ||||||||
| Corporate | 472 | 472 | 845 | -44.1 | % | ||||||||
| Intercompany eliminations | (1,176 | ) | (1,176 | ) | (1,202 | ) | 2.2 | % | |||||
| Total net revenues | $ | 1,071,681 | $ | - | $ | 1,071,681 | $ | 989,225 | 8.3 | % | |||
| Gross profit: | |||||||||||||
| 1-800-Flowers.com Consumer Floral | $ | 140,537 | $ | - | $ | 140,537 | $ | 131,254 | 7.1 | % | |||
| 39.1 | % | 39.1 | % | 38.8 | % | ||||||||
| BloomNet Wire Service | 40,520 | 40,520 | 38,306 | 5.8 | % | ||||||||
| 49.7 | % | 49.7 | % | 50.7 | % | ||||||||
| Gourmet Food & Gift Baskets | 271,360 | 271,360 | 250,550 | 8.3 | % | ||||||||
| 43.0 | % | 43.0 | % | 43.5 | % | ||||||||
| Corporate | 353 | 353 | 777 | -54.6 | % | ||||||||
| 74.8 | % | 74.8 | % | 92.0 | % | ||||||||
| Total gross profit | $ | 452,770 | $ | - | $ | 452,770 | $ | 420,887 | 7.6 | % | |||
| 42.2 | % | - | 42.2 | % | 42.5 | % | |||||||
| EBITDA (non-GAAP): | |||||||||||||
| Segment Contribution Margin (non-GAAP) (a): | |||||||||||||
| 1-800-Flowers.com Consumer Floral | $ | 34,853 | $ | - | $ | 34,853 | $ | 32,667 | 6.7 | % | |||
| BloomNet Wire Service | 27,516 | - | 27,516 | 25,375 | 8.4 | % | |||||||
| Gourmet Food & Gift Baskets | 100,512 | - | 100,512 | 89,191 | 12.7 | % | |||||||
| Segment Contribution Margin Subtotal | 162,881 | - | 162,881 | 147,233 | 10.6 | % | |||||||
| Corporate (b) | (71,583 | ) | 911 | (70,672 | ) | (67,303 | ) | -5.0 | % | ||||
| EBITDA (non-GAAP) | 91,298 | 911 | 92,209 | 79,930 | 15.4 | % | |||||||
| Add: Stock-based compensation | 6,441 | 6,441 | 4,531 | 42.2 | % | ||||||||
| Add: Comp charge related to NQ Plan<br><br> <br>Investment Appreciation/(Depreciation) | (1,653 | ) | (1,653 | ) | 327 | -605.5 | % | ||||||
| Adjusted EBITDA (non-GAAP) | $ | 96,086 | $ | 911 | $ | 96,997 | $ | 84,788 | 14.4 | % |
| 1-800-FLOWERS.COM, Inc. and Subsidiaries<br><br> <br>Selected Financial Information<br><br> <br>(in thousands) (unaudited) | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Reconciliation of net income (loss) to adjusted net | |||||||||||
| income (loss) (non-GAAP): | Three Months Ended | Nine Months Ended | |||||||||
| March 29,<br><br> <br>2020 | March 31,<br><br> <br>2019 | March 29,<br><br> <br>2020 | March 31,<br><br> <br>2019 | ||||||||
| Net income (loss) | $ | (9,657 | ) | $ | (8,241 | ) | $ | 49,224 | $ | 43,071 | |
| Adjustments to reconcile net income (loss) to adjusted net income (loss) (non-GAAP) | |||||||||||
| Add: Personalization Mall transaction costs | 911 | 911 | |||||||||
| Deduct: Income tax (benefit) on transaction costs | (217 | ) | (217 | ) | |||||||
| Adjusted net income (loss) (non-GAAP) | $ | (8,963 | ) | $ | (8,241 | ) | $ | 49,918 | $ | 43,071 | |
| Basic and diluted net income (loss) per common share | |||||||||||
| Basic | $ | (0.15 | ) | $ | (0.13 | ) | $ | 0.76 | $ | 0.67 | |
| Diluted | $ | (0.15 | ) | $ | (0.13 | ) | $ | 0.74 | $ | 0.65 | |
| Basic and diluted adjusted net income (loss) per common share (non-GAAP) | |||||||||||
| Basic | $ | (0.14 | ) | $ | (0.13 | ) | $ | 0.77 | $ | 0.67 | |
| Diluted | $ | (0.14 | ) | $ | (0.13 | ) | $ | 0.75 | $ | 0.65 | |
| Weighted average shares used in the calculation of net income (loss) and adjusted net income (loss) per common share | |||||||||||
| Basic | 64,348 | 64,194 | 64,517 | 64,383 | |||||||
| Diluted | 64,348 | 64,194 | 66,378 | 66,456 |
| 1-800-FLOWERS.COM, Inc. and Subsidiaries<br><br> <br>Selected Financial Information<br><br> <br>(in thousands)<br><br> <br>(unaudited)<br><br> <br>(continued) | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Reconciliation of net income (loss) to adjusted EBITDA | |||||||||||
| (non-GAAP): | |||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||
| March 29,<br><br> <br>2020 | March 31,<br><br> <br>2019 | March 29,<br><br> <br>2020 | March 31,<br><br> <br>2019 | ||||||||
| Net income (loss) | $ | (9,657 | ) | $ | (8,241 | ) | $ | 49,224 | $ | 43,071 | |
| Add: | |||||||||||
| Interest expense, net | 2,752 | (1,315 | ) | 3,441 | 2,097 | ||||||
| Depreciation and amortization | 7,803 | 7,028 | 23,268 | 22,840 | |||||||
| Income tax expense | 15,365 | 11,922 | |||||||||
| Less: | |||||||||||
| Income tax benefit | 3,983 | 5,073 | |||||||||
| EBITDA | (3,085 | ) | (7,601 | ) | 91,298 | 79,930 | |||||
| Add: Transaction costs | 911 | 911 | |||||||||
| Add: Stock-based compensation | 2,396 | 1,903 | 6,441 | 4,531 | |||||||
| Add: Compensation charge related to NQ plan investment appreciation/(depreciation) | (2,611 | ) | 1,294 | (1,653 | ) | 327 | |||||
| Adjusted EBITDA | $ | (2,389 | ) | $ | (4,404 | ) | $ | 96,997 | $ | 84,788 | |
| (a) Segment performance is measured based on segment contribution margin or segment Adjusted EBITDA, reflecting only the direct controllable revenue and operating expenses of the segments,<br> both of which are non-GAAP measurements. 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), and other<br> items that we do not consider indicative of our core operating performance. | |||||||||||
| --- | |||||||||||
| (b) Corporate expenses consist of the Company’s enterprise shared service cost centers, and include, among other items, Information Technology, Human Resources, Accounting and Finance,<br> 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<br> 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<br> are not directly allocable to a specific segment. |
FLWS-CP
Contacts
Investor Contact:
Joseph D. Pititto
\(516\) 237-6131
E-mail: [email protected]
Media Contact:
Kathleen Waugh
\(516\) 237-6028
[email protected]