ST. LOUIS--(BUSINESS WIRE)--Mar. 13, 2019--
Build-A-Bear Workshop, Inc. (NYSE: BBW) today reported results for the
13-week fourth quarter and 52-week fiscal year ended February 2, 2019
(“fiscal 2018”). As previously announced, due to the Company’s fiscal
year-end change, references to the prior year are based on the unaudited
recast results for the 14-week fourth quarter and 53-week fiscal year
ended February 3, 2018 (“fiscal 2017”).
Sharon Price John, Build-A-Bear Workshop President and Chief Executive
Officer, commented, “We believe there were a number of unusual
challenges that converged to negatively impact our financial results
last year. In North America, our largest overall market, we had a low
single-digit sales decline and modest profit on an adjusted basis;
however, the waning consumer confidence related to Brexit and new
privacy laws that inhibited consumer communication in our largest
international market, the United Kingdom, resulted in disappointing
financial results for the year on a consolidated basis.
“Other impacts for the year included the full-year closure of our most
profitable, multi-million-dollar retail store, the liquidation of Toys
“R” Us, the impact of new accounting standards and tax policies, and
lower licensed product sales due to the significant reduction in
family-centric movie properties. Conversely, we made key strategic
operational strides, including investments in e-commerce, IT
infrastructure and additional store locations while ending the year with
a solid balance sheet and no debt.
“And, while the situation in the United Kingdom still poses a challenge,
we believe most of the unusual circumstances that marked 2018 are now
behind us. As such, we expect fiscal 2019 to return to profitability
through a combination of improved retail sales benefitting from a strong
slate of family-centric films, continued double-digit growth in
e-commerce, and further expansion in non-retail revenue streams. Our
strategy remains focused on diversifying our revenue streams to better
monetize the power of the brand with the intention of improving
longer-term stakeholder value,” concluded Ms. John.
Fiscal Year 2018 Details (52 weeks ended February 2, 2019, compared
to 53 weeks ended February 3, 2018):
-
Consolidated revenues were $336.6 million compared to $364.0 million
in fiscal 2017, a decline of 7.5%. Fiscal 2017 included $6.0 million
in sales from the addition of the 53rd week and benefited from
$3.9 million in gift card breakage revenue recognized under the prior
revenue recognition rules (see reconciliation of GAAP to non-GAAP
results). On an adjusted basis, consolidated revenues declined 4.9% as
compared to fiscal year 2017;
-
By geography, revenue in North America was $283.3 million, a
decline of 2.0% from the prior year adjusted basis. Revenue in
Europe was $51.2 million, a decline of 17.6% from the prior year
adjusted basis;
-
Consolidated revenues in fiscal 2018 also included a 13.8%
increase in consolidated e-commerce sales primarily driven by
North America compared to fiscal year 2017;
-
Retail gross margin dollars were $139.5 million or 42.7% of retail
sales. The retail gross margin rate, excluding non-cash store
impairment charges, declined 450 basis points, including approximately
230 basis points related to the deleverage of fixed occupancy costs as
well as approximately 70 basis points related to the impact of the
adoption of the new revenue recognition standard. The remaining
decline was driven primarily by higher promotional activity mainly
related to Pay Your Age Day events;
-
Selling, general and administrative expenses decreased $1.6 million to
$157.2 million from $158.8 million in fiscal 2017;
-
Pre-tax loss was $18.5 million compared to pre-tax income of $14.0
million in fiscal 2017; adjusted pre-tax loss was $7.7 million,
exclusively driven by operating losses outside of North America (see
reconciliation of GAAP to non-GAAP results);
-
Income tax benefit was $0.6 million, compared to income tax expense of
$6.1 million in fiscal 2017. In fiscal 2018, a $3.7 million tax
valuation allowance was recorded on deferred tax assets in the United
Kingdom (see reconciliation of GAAP to non-GAAP results); and
-
Net loss was $17.9 million and adjusted net loss was $5.9 million (see
reconciliation of GAAP to non-GAAP results).
Store Activity:
In fiscal 2018, the Company opened 52 locations, closed 33 locations and
remodeled or reformatted 12 stores into a Discovery format, ending the
year with 37% of its store base in an updated Discovery format. As of
February 2, 2019, the Company operated 373 corporately-managed
locations, including 313 in North America and 60 outside of North
America. The Company’s international franchisees ended the year with 97
stores in 11 countries.
Income Tax Valuation Allowance:
In the fourth quarter of 2018, the Company recorded a valuation
allowance for its net deferred tax assets in the United Kingdom in the
amount of $3.7 million. The non-cash charge does not have any impact on
the Company’s consolidated operating income or cash flow, nor does such
an allowance preclude the Company from using the deferred tax assets in
the future.
Balance Sheet:
As of February 2, 2019, cash and cash equivalents totaled $17.9 million.
The Company ended fiscal 2018 with no borrowings under its revolving
credit facility. Total inventory at year-end was $58.4 million compared
to $58.1 million at 2017 year-end. On-hand inventory was down 5% offset
by in-transit inventory growth due to the shift in the timing of Chinese
New Year. In fiscal 2018, capital expenditures totaled $11.3 million and
depreciation and amortization were $16.0 million.
Share Repurchase:
Since December 30, 2017, the Company repurchased more than 766,000
shares of its common stock for $6.5 million, including over 528,000
shares during the five-week transition period associated with the fiscal
year-end change and nearly 238,000 shares during fiscal year 2018. As of
February 2, 2019, the Company had $8.8 million remaining on the share
repurchase authorization that was adopted in August 2017.
2019 Preliminary Expectations:
The Company is providing guidance for its preliminary GAAP expectations
for fiscal year 2019, (52 weeks ending February 1, 2020). On a GAAP
basis, the Company currently expects:
-
Total revenue to increase in the range of mid- to- high single-digits;
-
Pre-tax income to be slightly positive reflecting the increased sales
and improved gross profit margin;
-
Capital expenditures to be in the range of $10 to $15 million; and
-
Depreciation and amortization in the range of $15 to $17 million.
Today’s Conference Call Webcast:
Build-A-Bear Workshop will host a live internet webcast of its quarterly
investor conference call at 9 a.m. ET today. The audio broadcast may be
accessed at the Company’s investor relations website, http://IR.buildabear.com.
The call is expected to conclude by 10 a.m. ET.
A replay of the conference call webcast will be available in the
investor relations website for one year. A telephone replay will be
available beginning at approximately noon ET today until midnight ET on
March 20, 2019. The telephone replay is available by calling (844)
512-2921. The access code is 13687767.
About Build-A-Bear
Build-A-Bear is a global brand kids love and parents trust that seeks to
add a little more heart to life. Build-A-Bear Workshop has more than 450
stores worldwide where Guests can create customizable furry friends,
including corporately-managed stores in the United States, Canada,
China, Denmark, Ireland, Puerto Rico, and the United Kingdom, and
franchise stores in Africa, Asia, Australia, Europe, Mexico and the
Middle East. Build-A-Bear Workshop, Inc. (NYSE:BBW) posted total revenue
of $336.6 million in fiscal 2018. For more information, visit the
Investor Relations section of buildabear.com.
Forward-Looking Statements
This press release contains certain statements that are, or may be
considered to be, “forward-looking statements” for the purpose of
federal securities laws, including, but not limited to, statements that
reflect our current views with respect to future events and financial
performance. We generally identify these statements by words or phrases
such as “may,” “might,” “should,” “expect,” “plan,” “anticipate,”
“believe,” “estimate,” “intend,” “predict,” “future,” “potential” or
“continue,” the negative or any derivative of these terms and other
comparable terminology. All of the information concerning our future
liquidity, future revenues, margins and other future financial
performance and results, achievement of operating of financial plans or
forecasts for future periods, sources and availability of credit and
liquidity, future cash flows and cash needs, success and results of
strategic initiatives and other future financial performance or
financial position, as well as our assumptions underlying such
information, constitute forward-looking information.
These statements are based only on our current expectations and
projections about future events. Because these forward-looking
statements involve risks and uncertainties, there are important factors
that could cause our actual results, level of activity, performance or
achievements to differ materially from the results, level of activity,
performance or achievements expressed or implied by these
forward-looking statements, including those factors discussed under the
caption entitled “Risks Related to Our Business” and “Forward-Looking
Statements” in our Annual Report on Form 10-K filed with the Securities
and Exchange Commission (“SEC”) on March 15, 2018 and other periodic
reports filed with the SEC which are incorporated herein.
All of our forward-looking statements are as of the date of this Press
Release only. In each case, actual results may differ materially from
such forward-looking information. We can give no assurance that such
expectations or forward-looking statements will prove to be correct. An
occurrence of or any material adverse change in one or more of the risk
factors or other risks and uncertainties referred to in this Press
Release or included in our other public disclosures or our other
periodic reports or other documents or filings filed with or furnished
to the SEC could materially and adversely affect our continuing
operations and our future financial results, cash flows, available
credit, prospects and liquidity. Except as required by law, the Company
does not undertake to publicly update or revise its forward-looking
statements, whether as a result of new information, future events or
otherwise.
All other brand names, product names, or trademarks belong to their
respective holders.
BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES |
Unaudited Condensed Consolidated Statements of Operations |
(dollars in thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13 Weeks |
|
|
|
|
14 Weeks |
|
|
|
|
|
Ended |
|
|
|
|
Ended |
|
|
|
|
|
February 2, |
|
% of Total |
|
|
February 3, |
|
% of Total |
|
|
|
2019 |
|
Revenues (1) |
|
|
2018 |
|
Revenues (1) |
Revenues:
|
|
|
|
|
|
|
|
|
|
|
Net retail sales
|
|
$
|
98,544
|
|
|
97.0
|
|
|
$
|
115,478
|
|
98.3
|
Commercial revenue
|
|
|
2,315
|
|
|
2.3
|
|
|
|
1,025
|
|
0.9
|
International franchising
|
|
|
670
|
|
|
0.7
|
|
|
|
923
|
|
0.8
|
Total revenues
|
|
|
101,529
|
|
|
100.0
|
|
|
|
117,426
|
|
100.0
|
Cost of merchandise sold:
|
|
|
|
|
|
|
|
|
|
|
Cost of merchandise sold - retail (1) |
|
|
53,345
|
|
|
54.1
|
|
|
|
55,385
|
|
48.0
|
Store asset impairment (2) |
|
|
4,569
|
|
|
4.6
|
|
|
|
21
|
|
—
|
Cost of merchandise sold - commercial (1) |
|
|
1,474
|
|
|
63.7
|
|
|
|
672
|
|
65.6
|
Cost of merchandise sold - international franchising (1) |
|
|
835
|
|
|
124.6
|
|
|
|
95
|
|
10.3
|
Total cost of merchandise sold
|
|
|
60,223
|
|
|
59.3
|
|
|
|
56,173
|
|
47.8
|
Consolidated gross profit
|
|
|
41,306
|
|
|
40.7
|
|
|
|
61,253
|
|
52.2
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expense
|
|
|
47,842
|
|
|
47.1
|
|
|
|
47,633
|
|
40.6
|
Interest expense, net
|
|
|
80
|
|
|
0.1
|
|
|
|
33
|
|
0.0
|
Income (loss) before income taxes
|
|
|
(6,616
|
)
|
|
(6.5
|
)
|
|
|
13,587
|
|
11.6
|
Income tax expense
|
|
|
3,807
|
|
|
3.7
|
|
|
|
5,901
|
|
5.0
|
Net income (loss)
|
|
$
|
(10,423
|
)
|
|
(10.3
|
)
|
|
$
|
7,686
|
|
6.5
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) per common share:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.72
|
)
|
|
|
|
$
|
0.50
|
|
|
Diluted
|
|
$
|
(0.72
|
)
|
|
|
|
$
|
0.49
|
|
|
Shares used in computing common per share amounts:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
14,573,318
|
|
|
|
|
|
15,246,066
|
|
|
Diluted
|
|
|
14,573,318
|
|
|
|
|
|
15,423,097
|
|
|
|
(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 13 weeks ended February 2, 2019,
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 Statements of Operations |
(dollars in thousands, except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
52 Weeks |
|
|
|
|
53 Weeks |
|
|
|
|
Ended |
|
|
|
|
Ended |
|
|
|
|
February 2, |
|
% of Total |
|
|
February 3, |
|
% of Total |
|
|
2019 |
|
Revenues (1) |
|
|
2018 |
|
Revenues (1) |
Revenues:
|
|
|
|
|
|
|
|
|
|
Net retail sales
|
$
|
326,304
|
|
|
97.0
|
|
|
$
|
355,045
|
|
97.6
|
Commercial revenue
|
|
6,560
|
|
|
1.9
|
|
|
|
6,345
|
|
1.7
|
International franchising
|
|
3,721
|
|
|
1.1
|
|
|
|
2,570
|
|
0.7
|
Total revenues
|
|
336,585
|
|
|
100.0
|
|
|
|
363,960
|
|
100.0
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
Cost of merchandise sold - retail (1) |
|
186,834
|
|
|
57.3
|
|
|
|
187,447
|
|
52.8
|
Store asset impairment (2) |
|
5,195
|
|
|
1.6
|
|
|
|
21
|
|
—
|
Cost of merchandise sold - commercial (1) |
|
3,317
|
|
|
50.6
|
|
|
|
3,253
|
|
51.3
|
Cost of merchandise sold - international franchising (1) |
|
2,485
|
|
|
66.8
|
|
|
|
408
|
|
15.9
|
Total cost of merchandise sold
|
|
197,831
|
|
|
58.8
|
|
|
|
191,129
|
|
52.5
|
Consolidated gross profit
|
|
138,754
|
|
|
41.2
|
|
|
|
172,831
|
|
47.5
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative expense
|
|
157,176
|
|
|
46.7
|
|
|
|
158,837
|
|
43.6
|
Interest expense, net
|
|
85
|
|
|
0.0
|
|
|
|
24
|
|
0.0
|
Income (loss) before income taxes
|
|
(18,507
|
)
|
|
(5.5
|
)
|
|
|
13,970
|
|
3.8
|
Income tax expense (benefit)
|
|
(574
|
)
|
|
(0.2
|
)
|
|
|
6,138
|
|
1.7
|
Net income (loss)
|
$
|
(17,933
|
)
|
|
(5.3
|
)
|
|
$
|
7,832
|
|
2.2
|
|
|
|
|
|
|
|
|
|
|
Income (loss) per common share:
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
(1.23
|
)
|
|
|
|
$
|
0.50
|
|
|
Diluted
|
$
|
(1.23
|
)
|
|
|
|
$
|
0.49
|
|
|
Shares used in computing common per share amounts:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
14,591,270
|
|
|
|
|
|
15,508,346
|
|
|
Diluted
|
|
14,591,270
|
|
|
|
|
|
15,685,886
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 13 weeks ended February 2, 2019,
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)
|
|
|
|
|
|
|
|
|
|
February 2, |
|
February 3, |
|
December 30, |
|
|
2019 |
|
2018 |
|
2017 |
ASSETS |
Current assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
17,894
|
|
|
$
|
21,499
|
|
|
$
|
30,445
|
|
Inventories
|
|
|
58,356
|
|
|
|
58,100
|
|
|
|
53,136
|
|
Receivables
|
|
|
10,588
|
|
|
|
8,330
|
|
|
|
13,302
|
|
Prepaid expenses and other current assets
|
|
|
12,960
|
|
|
|
13,282
|
|
|
|
13,346
|
|
Total current assets
|
|
|
99,798
|
|
|
|
101,211
|
|
|
|
110,229
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
|
66,368
|
|
|
|
77,719
|
|
|
|
77,751
|
|
Deferred tax assets
|
|
|
3,099
|
|
|
|
4,964
|
|
|
|
6,381
|
|
Other intangible assets, net
|
|
|
731
|
|
|
|
898
|
|
|
|
995
|
|
Other assets, net
|
|
|
2,050
|
|
|
|
2,717
|
|
|
|
2,633
|
|
Total Assets
|
|
$
|
172,046
|
|
|
$
|
187,509
|
|
|
$
|
197,989
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
Current liabilities:
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
22,551
|
|
|
$
|
18,958
|
|
|
$
|
18,942
|
|
Accrued expenses
|
|
|
10,047
|
|
|
|
14,782
|
|
|
|
15,189
|
|
Gift cards and customer deposits
|
|
|
21,643
|
|
|
|
19,277
|
|
|
|
33,926
|
|
Deferred revenue and other
|
|
|
1,936
|
|
|
|
1,786
|
|
|
|
1,806
|
|
Total current liabilities
|
|
|
56,177
|
|
|
|
54,803
|
|
|
|
69,863
|
|
|
|
|
|
|
|
|
Deferred rent
|
|
|
18,440
|
|
|
|
17,708
|
|
|
|
17,906
|
|
Deferred franchise revenue
|
|
|
1,625
|
|
|
|
1,154
|
|
|
|
1,208
|
|
Other liabilities
|
|
|
1,490
|
|
|
|
1,743
|
|
|
|
1,697
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
|
|
Common stock, par value $0.01 per share
|
|
|
150
|
|
|
|
150
|
|
|
|
155
|
|
Additional paid-in capital
|
|
|
69,088
|
|
|
|
66,843
|
|
|
|
68,962
|
|
Accumulated other comprehensive loss
|
|
|
(12,018
|
)
|
|
|
(10,800
|
)
|
|
|
(11,562
|
)
|
Retained earnings
|
|
|
37,094
|
|
|
|
55,908
|
|
|
|
49,760
|
|
Total stockholders' equity
|
|
|
94,314
|
|
|
|
112,101
|
|
|
|
107,315
|
|
Total Liabilities and Stockholders' Equity
|
|
$
|
172,046
|
|
|
$
|
187,509
|
|
|
$
|
197,989
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES |
Unaudited Selected Financial and Store Data |
(dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13 Weeks |
|
14 Weeks |
|
|
52 Weeks |
|
53 Weeks |
|
|
|
Ended |
|
Ended |
|
|
Ended |
|
Ended |
|
|
|
February 2, |
|
February 3, |
|
|
February 2, |
|
February 3, |
|
|
|
2019 |
|
2018 |
|
|
2019 |
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
Other financial data: |
|
|
|
|
|
|
|
|
|
|
Total revenues by geographic area
|
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
$
|
84,975
|
|
|
$
|
93,736
|
|
|
|
$
|
283,347
|
|
|
$
|
297,864
|
|
Europe
|
|
|
|
16,226
|
|
|
|
21,407
|
|
|
|
|
51,231
|
|
|
|
63,281
|
|
Other (1) |
|
|
|
328
|
|
|
|
2,283
|
|
|
|
|
2,007
|
|
|
|
2,815
|
|
Total revenues
|
|
|
$
|
101,529
|
|
|
$
|
117,426
|
|
|
|
$
|
336,585
|
|
|
$
|
363,960
|
|
|
|
|
|
|
|
|
|
|
|
|
Retail gross margin ($) (2) |
|
$
|
|
45,199
|
|
$
|
|
60,093
|
|
|
$
|
|
139,470
|
|
$
|
|
167,598
|
|
Retail gross margin (%) (2) |
|
|
|
45.9
|
%
|
|
|
52.0
|
%
|
|
|
|
42.7
|
%
|
|
|
47.2
|
%
|
Capital expenditures (3) |
|
$
|
|
2,400
|
|
$
|
|
4,957
|
|
|
$
|
|
11,253
|
|
$
|
|
19,468
|
|
Depreciation and amortization
|
|
$
|
|
3,856
|
|
$
|
|
4,321
|
|
|
$
|
|
16,042
|
|
$
|
|
16,378
|
|
|
|
|
|
|
|
|
|
|
|
|
Store data (4): |
|
|
|
|
|
|
|
|
|
|
Number of corporately-managed retail locations at end of period
|
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
|
|
|
|
|
|
313
|
|
|
|
294
|
|
Europe
|
|
|
|
|
|
|
|
|
59
|
|
|
|
59
|
|
Asia
|
|
|
|
|
|
|
|
|
1
|
|
|
|
1
|
|
Total corporately-managed retail locations
|
|
|
|
|
|
|
|
|
373
|
|
|
|
354
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of franchised stores at end of period
|
|
|
|
|
|
|
|
|
97
|
|
|
|
100
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporately-managed store square footage at end of period (5) |
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
|
|
|
|
|
|
723,517
|
|
|
|
721,181
|
|
Europe
|
|
|
|
|
|
|
|
|
84,353
|
|
|
|
79,835
|
|
Asia
|
|
|
|
|
|
|
|
|
1,750
|
|
|
|
1,750
|
|
Total square footage
|
|
|
|
|
|
|
|
|
809,620
|
|
|
|
802,766
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Other includes international franchising revenue outside of North
America and Europe and a corporately-managed store in China.
|
(2)
|
|
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.
|
(3)
|
|
Capital expenditures represents cash paid for property, equipment,
other assets and other intangible assets.
|
(4)
|
|
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.
|
(5)
|
|
Square footage for stores located in North America is leased square
footage. Square footage for stores located in Europe is estimated
selling square footage.
|
|
|
|
* Non-GAAP Financial Measures
In this press release, the Company’s financial results are provided both
in accordance with generally accepted accounting principles (GAAP) and
using certain non-GAAP financial measures. In particular, the Company
provides historic income and income per diluted share adjusted to
exclude certain costs and accounting adjustments, which are non-GAAP
financial measures. These results are included as a complement to
results provided in accordance with GAAP because management believes
these non-GAAP financial measures help identify underlying trends in the
Company’s business and provide useful information to both management and
investors by excluding certain items that may not be indicative of the
Company’s core operating results. These measures should not be
considered a substitute for or superior to GAAP results.
|
|
|
|
|
|
|
|
|
BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES |
Reconciliation of GAAP to Non-GAAP Results |
(dollars in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America |
|
Europe |
|
Other (3) |
|
Total |
For the 53 weeks ended February 3, 2018
|
|
|
|
|
|
|
|
|
Total revenues
|
|
$
|
297,864
|
|
|
$
|
63,281
|
|
|
$
|
2,815
|
|
|
$
|
363,960
|
|
Fifty-third week of revenue (1) |
|
|
(4,915
|
)
|
|
|
(1,094
|
)
|
|
|
(36
|
)
|
|
|
(6,045
|
)
|
Timing of breakage revenue (2) |
|
|
(3,900
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(3,900
|
)
|
Adjusted total revenues
|
|
$
|
289,049
|
|
|
$
|
62,187
|
|
|
$
|
2,779
|
|
|
$
|
354,015
|
|
|
|
|
|
|
|
|
|
|
For the 52 weeks ended February 2, 2019, the Company had no revenue
adjustments.
|
|
|
(1)
|
|
Represents an additional week of revenue in the unaudited recast
results for the 53 weeks ended February 3, 2018.
|
(2)
|
|
Represents breakage revenue for certain gift cards under prior
revenue recognition rules.
|
(3)
|
|
Other includes international franchising revenue outside of North
America and Europe and a corporately-managed store in China.
|
|
|
|
* Non-GAAP Financial Measures
With the change in fiscal year, the fiscal 2018 adjusted results are
presented without comparison to the prior year unaudited recast results.
The prior year unaudited pre-tax recast results included asset
impairment of $0.5 million, foreign exchange gains of $1.8 million,
breakage benefit (for certain gift cards recognized under prior revenue
recognition rules) of $3.9 million and a loss for the 53rd week of
fiscal 2017 of $0.2 million.
|
|
|
|
|
BUILD-A-BEAR WORKSHOP, INC. AND SUBSIDIARIES |
Reconciliation of GAAP to Non-GAAP Results |
(dollars in thousands, except per share data)
|
|
|
|
|
|
|
|
13 Weeks |
|
52 Weeks |
|
|
Ended |
|
Ended |
|
|
February 2, |
|
February 2, |
|
|
2019 |
|
2019 |
Loss before income taxes (pre-tax)
|
|
$
|
(6,616
|
)
|
|
$
|
(18,507
|
)
|
Loss before income taxes adjustments:
|
|
|
|
|
Asset impairment (1)(7) |
|
|
7,652
|
|
|
|
9,060
|
|
Foreign exchange (gains) losses (2)(7) |
|
|
(314
|
)
|
|
|
964
|
|
Other (3) (7) |
|
|
485
|
|
|
|
757
|
|
Adjusted income (loss) before income taxes (adjusted pre-tax)
|
|
|
1,207
|
|
|
|
(7,726
|
)
|
|
|
|
|
|
|
|
|
|
|
Income tax expense (benefit)
|
|
|
3,807
|
|
|
|
(574
|
)
|
Tax adjustments:
|
|
|
|
|
Income tax impact: adjustments (4) |
|
|
1,669
|
|
|
|
2,216
|
|
Income tax charges (5) |
|
|
242
|
|
|
|
242
|
|
Valuation allowance (6) |
|
|
(3,743
|
)
|
|
|
(3,743
|
)
|
Adjusted income tax expense (benefit)
|
|
|
1,975
|
|
|
|
(1,859
|
)
|
|
|
|
|
|
Net loss
|
|
|
(10,423
|
)
|
|
|
(17,933
|
)
|
Adjustments
|
|
|
9,655
|
|
|
|
12,066
|
|
Adjusted net loss
|
|
$
|
(768
|
)
|
|
$
|
(5,867
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per diluted share (EPS)
|
|
$
|
(0.72
|
)
|
|
$
|
(1.23
|
)
|
|
|
|
|
|
Adjusted net loss per diluted share (adjusted EPS)
|
|
$
|
(0.05
|
)
|
|
$
|
(0.40
|
)
|
|
|
|
|
|
(1)
|
|
Represents non-cash asset impairment charges related to store fixed
assets, receivables and inventory.
|
(2)
|
|
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 and
transactional gains and losses. 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.
|
(3)
|
|
Includes severance and other non-recurring changes in reserves and
charges.
|
(4)
|
|
Represents the aggregate tax impact of the pre-tax adjustments.
|
(5)
|
|
Represents the final impact of the Tax Reform Act enacted in
December 2017.
|
(6)
|
|
Valuation allowance recorded on its deferred tax assets in the
United Kingdom.
|
(7)
|
|
These pre-tax adjustments totaled $7.8 million and $ 10.8 million
for the 13 and 52 weeks ended February 2, 2019, respectively.
|
|
|
|

View source version on businesswire.com: https://www.businesswire.com/news/home/20190313005223/en/
Source: Build-A-Bear Workshop, Inc.
Investors: Voin Todorovic Build-A-Bear Workshop 314.423.8000
x5221
Media: Beth Kerley Build-A-Bear Workshop bethk@buildabear.com
|